Harmony Energy Income Trust (HEIT) has successfully bid six battery energy storage system (BESS) projects in the latest T-1 Capacity Market (CM) auction for delivery years 2024/25, increasing its revenue for this period to £3.2 million.
This was revealed by the battery storage investment firm today (22 February), who confirmed that with the auction clearing at £35.79/kW/year and taking into account the 22% de-rations, the company’s contracted revenue for this period is set to be £3.2 million (roughly £8,000/MW), adding £1.7 million to be factored into its modelled cash flows.
Results of the latest T-1 CM auction were released by the National Grid ESO on 20 February, with the auction clearing after eight rounds. According to the National Grid ESO’s preliminary results, BESS were awarded the highest capacity of all entered to clean technologies at 655.16MW.
Speaking at Solar Media’s Energy Storage Summit EU 2024 yesterday (21 February), Georgina Morris, head of capacity market policy – low carbon technologies for the Department of Energy Security and Net Zero (DESNZ) revealed that, from her conversations with market participants, the CM is becoming a “more important part of the [BESS] revenue stack,” as shown by the increase in HEIT’s contracted revenue for 2024/25.
“The Capacity Market is not the main chunk of the [BESS] revenues stack,” continued Morris, “but I am starting to think that, especially in a high-interest environment, guaranteed contractual payment is important for batteries.”