IN Brief:
- Centrica Energy has contracted 100MW/400MWh of German battery flexibility through Return’s Virtual Flexibility Portfolio.
- The capacity remains backed by physical batteries but can be supplied from several Return-owned assets rather than one dedicated project.
- Centrica will optimise the portfolio across German wholesale and ancillary-services markets under the long-term virtual tolling agreement.
Centrica Energy and Return have signed a long-term virtual tolling agreement covering 100MW/400MWh of battery flexibility in Germany, using a portfolio structure that allows the contracted capacity to be supplied from several physical storage assets rather than one dedicated project.
The agreement gives Centrica access to Return’s Virtual Flexibility Portfolio, which aggregates battery energy storage systems across Germany into a single commercial pool. Return supplies the physical assets and operational capability, while Centrica will optimise the contracted flexibility across German wholesale electricity and ancillary-services markets.
The 400MWh energy commitment corresponds to four hours of storage at the full contracted 100MW power rating, although the structure differs from a conventional four-hour tolling agreement tied to one site. Centrica is buying access to an aggregate flexibility product, with Return able to allocate delivery across its wider German battery fleet.
Spreading the commitment across several assets reduces dependence on the availability of a single installation. Maintenance, connection restrictions or technical faults at one battery can potentially be offset by capacity elsewhere in the portfolio, provided Return retains enough physical capability to meet the overall contracted obligation.
Each battery nevertheless remains subject to its own electrical limits. Connection capacity, state of charge, inverter power, round-trip losses, maintenance requirements and local network constraints still determine what an individual site can deliver at any moment. The virtual portfolio has to convert those separate operating envelopes into one commercially dependable resource.
Centrica’s optimisation platform will decide how the available capacity is positioned between charging, discharging and reserve commitments. German wholesale and ancillary markets can offer different opportunities over the same operating period, while each commitment changes the energy remaining for subsequent trades.
The new agreement follows a separate German storage contract signed by Centrica earlier this year. Centrica is also due to optimise Zelestra’s 99MW/297MWh Hilgermissen battery, where the tolling arrangement applies to a defined three-hour project scheduled to enter operation during the second half of 2028.
Return’s portfolio model removes that single-site dependency. The company owns and develops batteries across Germany and can make contracted capacity available through one commercial interface as its fleet grows, rather than negotiating a separate optimisation structure for every installation.
Battery revenues are becoming increasingly dependent on this type of multi-market operation. Early storage projects could rely heavily on short-duration frequency services, but additional deployment increases competition for individual ancillary products. Wholesale spreads, intraday volatility, balancing services and other flexibility markets increasingly have to be coordinated across the same asset.
A portfolio adds another layer to that optimisation problem. The trading system has to track not only one battery’s available energy and power, but the condition of several sites and the commitments already assigned to each. A profitable portfolio position remains useful only if the physical batteries selected to deliver it have sufficient energy, connection capacity and response capability.
The four-hour contracted duration broadens the range of possible dispatch patterns. A 100MW resource backed by 400MWh can sustain significant output over several hours, giving Centrica scope to move energy between trading periods as well as retain capacity for faster reserve services.
Germany’s rising wind and solar generation increases the value of flexible demand and storage, but charging behaviour remains sensitive to grid location. A battery drawing power in a constrained area can increase network loading even when electricity prices suggest charging is attractive, so commercial dispatch and physical network conditions cannot be treated independently.
Return’s Virtual Flexibility Portfolio is intended to scale as more batteries join the fleet. The commercial advantage is that additional capacity can be incorporated into an existing framework, while the technical challenge is preserving the performance expected from the aggregate product as the number of underlying assets increases.
The 100MW/400MWh agreement gives Centrica another substantial block of German storage without tying the entire contract to one construction programme or grid connection. Return, meanwhile, gains a single optimisation relationship across multiple assets, moving battery commercialisation closer to a fleet model in which software, telemetry and dispatch coordination sit alongside the physical storage hardware.
