Finnish technology group Wärtsilä has transferred its global energy storage business to Valo, a joint venture it owns equally with German engineering company RCT Solutions, and said it expects the new company to lose money in 2026 before turning positive toward the end of 2027.
Valo, a utility-scale BESS integrator that includes Wärtsilä’s Energy Storage business, launched on Oct. 1 after Wärtsilä and RCT Solutions closed their joint venture. Valo said it starts with more than 20 GWh across more than 130 projects worldwide. Peter Fath, previously CEO of RCT Solutions, is the CEO of the new venture, and Luke Witmer is chief technology officer.
Wärtsilä announced the deal on June 15 and said it would transfer net assets representing less than 5% of its total net assets. Closing was subject to regulatory approvals and the arrangement of a financing package. New investors may join later, which could dilute the two founding shareholders, and the joint venture will benefit from project guarantees Wärtsilä has already issued on ongoing projects, said the Helsinki-based group.
Wärtsilä also stated that the joint venture would be loss-making in 2026 because of low recent order intake and transformation costs, mainly a write-down of capitalized R&D. It estimated the impact on its full-year 2026 operating result at €40 million ($45.2 million) to €50 million, depending on the timing of closing, and said it expects the joint venture to generate positive results toward the end of 2027. Its Oct. 1 closing release reiterated the 2026 loss expectation.
Wärtsilä said the energy storage business was its smallest segment, with about 480 employees. It posted net sales of €694 million in 2025 at an operating margin of 3.3%, ending the year with an order book of €719 million.
Wärtsilä said RCT Solutions, founded in 2012, has led the engineering and establishment of several battery and solar manufacturing facilities worldwide, and that one RCT company has been a key supplier to Wärtsilä Energy Storage for several years. It said RCT also brings an opportunity for vertical integration through an existing integrated BESS manufacturing initiative in the United States in the near term. Neither company has named the project.
Wärtsilä began a strategic review of the business in October 2023 and ended it in March 2025 by splitting storage into a separate reporting segment with its own financial targets. After agreeing the joint venture, it reclassified the unit as discontinued operations, and it will now report its stake as a share of result in associated companies.
When it launched the review, Wärtsilä reported net sales of €983 million for the business on a 12-month rolling basis to the end of the third quarter of 2023. The targets it set in March 2025, low double-digit annual organic growth and an operating margin of 3% to 5%, no longer apply following the joint venture agreement.
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