Portugal just told the market what firm capacity is worth.
Portugal just told the market what firm capacity is worth.
The government has reaffirmed plans for a dedicated auction of 750 MVA of battery storage capacity, built into a new capacity mechanism that will pay batteries, generation and demand-side flexibility for being available when the system needs them most.
For developers, that changes the design brief. Duration stops being a footnote and becomes the variable that decides which revenue streams a project can actually stack.
The market’s centre of gravity is shifting from 1-2 hour systems toward 4 hours as the working baseline, with longer-duration configurations gaining ground as capacity and ancillary-service value get priced more explicitly alongside arbitrage.
We see the same logic beyond Iberia. Across the Gulf and the African pipelines we work on, storage is increasingly sized around what the local market actually pays for, not around a standard configuration.
A battery’s business case is now written in hours as much as in megawatts.
For anyone sizing storage today — how many hours of duration are you underwriting as your base case?
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