Battery energy storage systems (BESS) emerged as the top-performing clean energy technology in the UK’s T-1 Capacity Market Auction for the 2024/25 delivery year, securing 655.16MW of capacity. The auction, which concluded on 20 February after eight rounds, cleared at a price of £35.79/kW/year.
Preliminary results, released by National Grid Electricity System Operator (ESO), showed battery energy storage systems leading clean technologies, followed by pumped storage with 185.38MW (2.43%). Solar energy secured 10.45MW (0.14%), hydro contributed 98.92MW (1.29%), and offshore and onshore wind accounted for 73.87MW (0.97%) and 33.36MW (0.44%), respectively.
Despite the strong performance of clean technologies, the majority of capacity was awarded to gas-powered generation, receiving 2,943.79MW (38.53%), and nuclear energy, which secured 2,767.26MW (36.22%). Demand-Side Response (DSR) also made a significant impact, winning 9.29% of the awarded capacity.
Around 9.5GW of de-rated capacity entered the auction, with less than 300MW exiting early. Two of the largest power stations, Sutton Bridge (819MW) and Severn (850MW), withdrew in the early rounds, removing a combined 1.5GW of capacity and helping the auction clear. In total, 7.6GW of capacity was awarded across 277 Capacity Market Units (CMUs).
Georgina Morris, head of capacity market policy for low-carbon technologies at the Department for Energy Security and Net Zero (DESNZ), confirmed that the auction cleared at a price 40% lower than last year’s £60/kW/year for the 2023/24 delivery year. Speaking at the Energy Storage Summit 2024, Morris highlighted the growing importance of the Capacity Market for the battery energy solar system sector.
“What I’m seeing from various commentators is that the Capacity Market is starting to become a more important part of the [BESS] revenue stack,” Morris said, emphasising the evolving role of energy storage in supporting the UK’s clean energy transition.
The strong results also underline the growing value of combining a solar system with battery storage to maximise renewable energy generation and resilience across the grid. As the shift towards sustainable energy accelerates, both battery energy storage systems and solar system with battery storage solutions are expected to play a crucial role in shaping a reliable, low-carbon future.