Considering that the BMW Niederlassung Munich is a company-owned dealership, M does stand for Munich where BMW is based, and the test vehicle sticker is identical to what BMW had on the i3 pre-production cars, it is highly likely that this S is owned by BMW and being used for testing...
Actually "B" stands for Bavaria, of which Munich is the main city (I'm not sure "Capitol" would be the correct word). "M" stands for Motor. "W" is for Works. Of course it is in German, really: Bayerische Motoren Werke AG.