IN Brief:
- Battery storage projects secured a combined 1.8GW of capacity obligations across the latest T-1 and T-4 Capacity Market auctions.
- The T-1 auction cleared at £5/kW/year with 7.192GW procured, while the T-4 auction cleared at £27.10/kW/year with 40.109GW procured.
- Storage continues to win a place in the reliability stack, even as lower clearing prices limit how far Capacity Market revenues can support new-build economics on their own.
Battery energy storage projects secured a combined 1.8GW of capacity obligations across Great Britain’s latest Capacity Market auctions, reinforcing the technology’s position as an established part of the system’s reliability mix rather than a peripheral source of flexibility.
The result spans both the one-year-ahead T-1 auction for delivery in 2026/27 and the four-year-ahead T-4 auction for delivery in 2029/30. Storage won 576MW in the T-1 round and 1,224MW in the T-4 round, while the wider auctions procured 7.192GW and 40.109GW respectively. The T-1 cleared at £5/kW/year and the T-4 at £27.10/kW/year, both well below the previous year’s levels.
The broader market context matters. The government had set target capacities of 6.3GW for the T-1 auction and 39.4GW for the T-4 round, so both auctions cleared above target volumes. The Capacity Market remains technology-neutral, paying assets for being available during system stress events rather than rewarding any one technology directly, which means batteries are increasingly competing alongside gas, nuclear, demand-side response, interconnectors, and pumped hydro on a reliability basis.
National Energy System Operator results show storage is no longer confined to ancillary-service niches. A 1.8GW award across the two auctions places BESS firmly inside the mainstream adequacy framework, at a time when the power system is carrying higher volumes of intermittent renewable generation and needs fast-response assets that can stabilise short-term imbalances.
At the same time, the clearing prices tell a more restrained story for project economics. Capacity Market revenues still matter, but the latest prices underline that they are unlikely to form the core investment case for most battery projects on their own. For many developers, capacity agreements remain one layer in a wider revenue stack that also depends on balancing services, wholesale trading, and other flexibility markets.
That tension is visible across the wider auction outcome. Lower prices are good for consumer cost control and signal strong competition, but they also soften the long-term revenue signal for assets that still need capital to move into construction. In practical terms, batteries are winning a growing share of the reliability role, while the market continues to assume that other value streams will do much of the heavy lifting on returns.
The latest round does not settle the longer debate over how Britain should value duration, resilience, or different forms of storage over the next decade. It does, however, confirm something more immediate: battery projects are now a routine part of the Capacity Market landscape, and the grid is increasingly relying on them as part of its firm capacity base.
