THIS IS A TEST INSTANCE. ALL YOUR CHANGES WILL BE LOST!!!!
...
- In the Data Source Exlorer View, right-click on Databases and choose New ... .
...
* Select Derby Embedded Database and click on Next. 
...
* Enter a name and description. (Note: Both are for your reference only!) Click Finish. 
* Most likely, you will not yet have a Driver Definition for the Derby database available, so the Select a driver dropdown will be empty. Click on the ... button next to it to start creating a driver definition.
* Choose 10.2 under Derby and click the Add... button.
* Make sure you choose the Derby Embedded JDBC driver and click OK. 
* The template expects the driver to be in a file called derby.jar. Select that line in the Driver File(s) listbox and click on Edit Jar/Zip to specify the actual location of the JAR file. You will find this in your workspace as framework/entity/lib/jdbc/derby-10.2.2.0.jar. When done, click OK. 
* You should be back in the Driver and Connection Details. Fill in the parameters as you can see them here. Note: For Database location, adapt to your workspace location. There is no way to use a variable in this path, unfortunately. Username and password are ofbiz/ofbiz by default. For convenience, in a development environment, it should be acceptable to save the password with the connection. Make sure that Create database (if required) is unchecked, as this does not make sense in this context.
Important: This is not the place to decide that you'd like your Derby DB in a different location for OFBiz as OFBiz itself does not use these settings. If you would like to have your database outside of the workspace, take a look at the entityengine.xml config file and read the Entity Engine Configuration Guide to learn how to switch databases.
...