Monthly BESS revenues and market trends, Q2 2026

METHODOLOGICAL UPDATE PORTFOLIO PERFORMANCE

To provide a portfolio performance view that is neutral to asset availability, we introduced methodological updates. Firstly, it applies a data-quality filter to exclude days where an asset was not operational for more than four hours. As a result, revenues from wholesale, aFRR, and FCR on these partial-availability days are removed, which can lead to slightly lower total revenues. However, the same filtering is also applied to the calculation of average marketable power (MW) and energy (MWh), meaning that averages are computed only on fully operational days. This creates a more representative performance metric.

Secondly, duration clustering has been refined. The 2h segment is now defined as 1.51-2.5h rather than extending to 3.5h. This change was requested by asset owners and market participants to create a cleaner benchmark that more closely represents a true 2h asset. The cluster description now also focuses on P10/P90 ranges rather than minimum/maximum values, reducing the influence of outliers.

However, when adjusting for these composition effects, the underlying performance remained nearly identical, confirming that the new methodology improves consistency and robustness rather than materially changing economic outcomes.

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Market evolution and BESS revenues May 2026

May delivered another strong month for battery storage optimization in Germany, with both 1-hour and 2-hour BESS portfolios maintaining annualized revenues above EUR 180k/MW/year and EUR 250k/MW/year respectively. Wholesale power prices recovered significantly compared with April. German day-ahead prices increased by 39.2% month-on-month to EUR 102.50/MWh, while intraday VWAP increased by 34.8% to EUR 102.88/MWh. However, higher average price levels did not translate into stronger arbitrage conditions for storage assets.

Compared with April, May recorded fewer negative-price events and lower average price spread. Negative day-ahead quarter-hours declined by 36.0% month-on-month (492 to 315), while the daily price-spread proxy decreased by 16.0%. As a result, the number of attractive charge-discharge opportunities was lower, particularly for longer-duration assets. Both 1-hour and 2-hour assets continued to benefit from:

• Strong participation opportunities in balancing and reserve markets
• Recurring negative-price periods during high-solar production hours
• Solar-driven intraday price spreads and evening ramping events
• Continued demand for system flexibility and reserve capacity

These conditions reinforced the value of flexible storage assets capable of dynamically allocating capacity between wholesale and ancillary service markets. While average market prices increased significantly, portfolio performance remained primarily driven by the availability of spread opportunities and ancillary-service revenues rather than outright power price levels.

Key month-on-month market indicators

Note: Daily price-dispersion proxy = max(DA auction, ID VWAP, ID Auction 1, ID Auction 2, ID Auction 3) minus min of the same daily reference prices. Values are monthly averages of daily spreads.

Key month-on-month portfolio indicators

Portfolio performance

The 1-hour portfolio achieved its strongest performance of 2026 to date, increasing annualized revenues from EUR 180k/MW/year to EUR 186k/MW/year (+3.1% MoM). Importantly, this revenue growth was achieved despite lower cycling intensity. Average throughput decreased from 1.08 to 0.98 FCE/day (-9.7%), while average operating duration increased slightly from 1.17h/day to 1.19h/day (+2.0%). This indicates that revenue quality improved during May, with each cycle capturing more value.

Although average wholesale prices increased significantly in May, the market offered fewer high-value arbitrage opportunities for longer-duration assets. The frequency of negative-price events declined materially, with negative day-ahead quarter-hours falling by 36% month-on-month (492 to 315), while the daily price-dispersion proxy decreased by 16%. As a result, the number of economically attractive charge-discharge opportunities was lower than in April, reducing average cycling from 1.42 to 1.24 FCE/day. Consequently, annualized revenues declined modestly by 2.2% to EUR 251.6k/MW/year.

Day-ahead and intraday markets

Wholesale price levels rebounded in May. Average day-ahead rose from 73.64 to 102.50 EUR/MWh (+39.2%), while ID VWAP increased from 76.31 to 102.88 EUR/MWh (+34.8%). ID Auction 3 had the sharpest recovery, rising from 55.44 to 98.89 EUR/MWh (+78.4%).

Despite higher average prices, daily cross-reference price dispersion moderated during May. The daily dispersion proxy declined from EUR 164k/MW/year in April to EUR 138k/MW/year in May (-16.0% MoM). At the same time, negative day-ahead price periods became less frequent, with negative quarter-hours falling by 36.0% MoM. This reduced the number of high-value charging opportunities available to storage assets, helping explain why battery revenues did not increase in line with wholesale price levels.

The reduction of the SDAC day-ahead price floor from -500 EUR/MWh to -600 EUR/MWh highlights the growing influence of solar-driven oversupply events in European power markets. Although May recorded fewer negative-price periods than April, the new price boundary increases the potential value of future extreme charging opportunities for battery storage assets.

Ancillary services and balancing markets

Capacity prices were mixed. aFRR up decreased from 10.96 to 10.05 EUR/MW/day (-8.3%), aFRR down increased from 21.54 to 22.10 EUR/MW/day (+2.6%), and FCR slipped from 23.72 to 22.71 EUR/MW/day (-4.2%). The two duration buckets responded differently to May's market conditions. The 1-hour portfolio achieved a modest increase in annualized revenues despite fewer negative-price events, supported by strong participation in ancillary service markets. The 2-hour portfolio maintained annualized revenues above EUR 250k/MW/year, although total revenues declined slightly as fewer high-value opportunities resulted in lower cycling activity (1.24 FCE/day versus 1.42 FCE/day in April). Across both duration buckets, aFRR capacity revenues remained the largest contributor to total portfolio revenues, providing a stable revenue foundation alongside wholesale market optimization opportunities.

Extreme price events and special days

May remained supportive for battery optimization, although negative-price events were less frequent than in April. Germany recorded 315 negative day-ahead quarter-hours (78.8 hours) during May, compared with 492 quarter-hours (123.0 hours) in April, representing a 36.0% month-on-month decline. Despite the reduction in negative-price frequency, solar-driven midday price depressions continued to create attractive charging opportunities for BESS assets. These low-price periods were frequently followed by stronger evening price recovery, allowing optimized portfolios to capture value from within-day volatility. The strongest trading day of the month occurred on 27 May, EUR 674.71/MW/day for 1-hour assets and EUR 802.56/MW/day for 2-hour assets, highlighting the continued value of storage duration during periods of elevated price dispersion.

Fundamentals (renewables, load) and key takeaways

May moved further into the solar-heavy spring regime. Average solar generation increased from 13,562 to 14,615 MW (+7.8%), while wind declined from 13.5GW to 9.13 MW (-29.5%). Average load fell from 50,783 to 48,387 MW (-4.7%). As renewable penetration continues to increase, the ability to dynamically allocate capacity between wholesale and ancillary-service markets remains a key driver of value creation for battery storage assets. While May contained fewer negative-price events and narrower average spreads than April, optimized portfolios continued to benefit from recurring low-price charging opportunities, evening demand ramps, and robust reserve-market revenues.

Market evolution and BESS revenues April 2026

For the 1.51-2.5h BESS portfolio in Germany, annualized PnL increased from EUR 180,795.30 per marketable MW in March to EUR 257,383.45 in April (+42.4%). Average daily cycling rose from 1.39 to 1.42 FCE/day. For the 0.9-1.5h BESS portfolio in Germany, annualized PnL increased from EUR 136,496.87 per marketable MW in March to EUR 180,345.68 in April (+32.1%). Average daily cycling was broadly stable at 1.08 FCE/day.

April extended the March recovery rather than reversing it. The uplift was no longer driven by higher outright wholesale prices: Average day-ahead and intraday reference prices fell month-on-month. Instead, realized battery revenues were supported by stronger reserve capacity prices, higher aFRR energy monetization, and wider intraday dispersion linked to high solar output, low wind, and lower system demand.

Key month-on-month market indicators

Key month-on-month portfolio indicators

Wholesale markets (DA and ID)

Wholesale price levels weakened in April even as battery revenue remained strong. The average German day-ahead price declined from EUR 99.25/MWh in March to EUR 78.52/MWh in April (-20.9%). ID VWAP (Intraday volume-weighted average price) declined from EUR 98.80/MWh to EUR 79.79/MWh (-19.2%). The sharpest move was in ID auction 3, which fell from EUR 103.63/MWh to EUR 59.25/MWh (-42.8%).

However, price dispersion improved. A simple daily spread proxy across day-ahead, ID VWAP, and ID auction references increased from EUR 20.70/MWh in March to EUR 25.64/MWh in April (+23.9%). The maximum daily proxy widened to EUR 95.52/MWh on 2026-04-25, confirming that the month contained deeper short-term dislocations despite lower average price levels.

Ancillary services and balancing markets

The balancing complex was again the main source of support. Average daily aFRR capacity revenue increased from EUR 3,071/MW/day in March to EUR 3,493/MW/day in April (+13.7%). Average daily energy arbitrages revenue increased from EUR 272/MW/day to EUR 554/MW/day (+103.4%), making activation energy a much larger contributor than in March.

At the product level, aFRR up capacity prices increased from EUR/MW/day 10.27 to 11.16 (+8.6%), aFRR down capacity increased from EUR/MW/day 11.83 to 20.47 (+73.1%), and FCR capacity increased from EUR/MW/day 16.64 to EUR 22.95 (+37.9%).

Extreme price events and special days

The stronger April revenue profile was mainly linked to structural changes in renewable generation and system balance. Wind generation remained relatively subdued during several high-value periods, tightening the system and increasing scarcity in the balancing market. At the same time, solar output increased materially versus March, creating deeper midday price depressions followed by steeper evening ramps. This widened intraday spreads and improved arbitrage opportunities for BESS assets.

The exceptional peak on 26 April was likely driven by a combination of low residual load flexibility, sharp renewable ramps, and elevated reserve-capacity prices. High solar penetration during daytime hours compressed midday prices, while weaker wind and stronger evening demand recovery generated significant upward price corrections later in the day. These conditions typically increase both wholesale spread capture and ancillary-service revenues simultaneously.

Fundamentals: renewables and load

Fundamentals shifted further into a spring solar regime. Average solar generation increased from 9,664 MW in March to 13,367 MW in April (+38.3%), while average wind generation fell from 3,118 MW to 2,535 MW (-18.7%). Average load declined from 54,335 MW to 51,379 MW (-5.4%).

The combination of materially higher solar, lower wind, and lower demand created deeper daytime charging opportunities and steeper residual-load ramps. Lower wind also supported reserve scarcity conditions. The result was a market environment in which average wholesale prices fell, but batteries still captured stronger spread, balancing, and reserve monetization opportunities.