Monthly Report

TESS Holdings and Daiwa Energy & Infrastruct. partner on BESS, aim to commit to 2GWh of projects in 3 years

February 6, 2025
BESS
TESS Holdings will mainly be in charge of the physical side while Daiwa Energy & Infrastructure will be in charge of the business side.

Renewable asset developer and services company TESS Holdings will partner with asset manager Daiwa Energy & Infrastructure to develop grid-scale battery storage, TESS announced on February 5, 2025.

“Through this partnership, we believe that by combining our group’s BESS development capabilities with the BESS-related investment know-how and financial strength of Daiwa Energy Infrastructure, we will be able to quickly advance our grid storage battery business,” said TESS Holdings’ statement.

The companies will aim to commit to 2GWh of grid-scale BESS projects in Japan within three years of launching the partnership, which is expected to be formalized in a memorandum of understanding today.

TESS Holdings will be responsible for the physical development of projects including land acquisition, grid connection, and permitting. Daiwa Energy & Infrastructure will oversee the business side, conducting due diligence and economic feasibility assessment, arranging project finance, and investing in the projects directly, while also introducing potential project sites to TESS.

The partnership with Daiwa Energy & Infrastructure follows a broader renewables-related capital and business alliance of TESS Holdings with Tokyo Century announced in December 2024. As part of the alliance, Tokyo Century acquired a minority stake in and agreed to consider signing tolling agreements for BESS projects being developed by TESS.

Daiwa Energy & Infrastructure has also been active in BESS, having invested in a 50MW/100MWh facility planned to be commissioned in Hokkaido at the end of October 2025.

Separately, both companies have experience with renewable generation assets. TESS Holdings owns over 300MW of solar and biomass generation capacity. The Japan Energy Hub PPA database shows its subsidiary TESS Engineering has been active in the on-site PPA market, primarily focusing on small, sub-1MW agreements.

Daiwa Energy & Infrastructure has, among other things, formed a joint venture with Kansai Electric Power and SMFL Mirai Partners, which develops solar power plants for Kansai EPCO-arranged off-site PPAs. The joint venture, KDS Solar, is working on deals with McDonald’s and Hankyu among others.

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