The storage engine must be provided as a JVM environement variable or System property because this is how we read it:

String storageEngine = Environment.getProperties().getProperty( Environment.STORAGE_ENGINE );
if(storageEngine == null) {
    storageEngine = System.getProperty( Environment.STORAGE_ENGINE );
}

We can't use Hibernate properties here since the Dialect is bootstrapped prior to the Property Resolver mechanism.

Also, why don't you use MySQL55Dialect? Is the MySQL instance you are using older than 5.5?