Developing low-cost energy storage systems is a central pillar for a secure, affordable and environmentally friendly energy supply based on renewable energies. A hybrid energy storage system (HESS) can be capable of providing multiple system services (e.g. frequency regulation or renewable balancing) at low cost and without the use of critical resources. Within HyFlow, an optimized HESS is designed consisting of a high-power vanadium redox flow battery (HP-VRFB), a supercapacitor (SC), advanced converter topologies and a highly flexible control system that allows adaptation to a variety of system environments. The system design enables modular long-term energy storage through HP-VRFB, while the SC as a power component ensures high load demands to be handled. The flexible Energy Management System (EMS) will be designed to perform high level of control and adaptability using computational analysis and hardware development. Within HyFlow, this innovative HESS is developed and validated on demonstrator-scale (5 kW scale) including sustainability analysis. The scope is to base the HP-VRFB on recycled vanadium and thereby reduce the environmental impact as well as the costs of the HESS. The consortium will build upon lab-scale and industrial application-scale experimental data to derive models and algorithms for the EMS development and the optimization of existing VRFB and SC components. An industry-scale demonstrator (300 kW scale) provides the possibility to test even the fastest grid-services like virtual inertia. Outputs of the project support the whole value-chain and life cycle of HESS by developing new materials and components and adding them together with an innovative EMS. The development of the above described HESS especially through the flexible EMS allows a plethora usage potentials to be assessed. This will lead to the grid integration of the HESS where the full potential of the flexibility can thoroughly be qualified and optimized for market requirements.