The National Energy System Operator (NESO) has released its provisional auction results for the one-year ahead (T-1) and four-year ahead (T-4) capacity auctions.
The T-1 capacity auction for delivery in 2025/2026 concluded on 5 March 2025 at 10am, resulting in 7,936.289MW procured across 246 Capacity Market Units (CMUs). The clearing price was set at £20.00/kW/year.
In total, 725.813MW of battery energy storage system (BESS) capacity was awarded in the T-1 auction, across 78 CMUs, making up 9.15% of total awarded capacity. Furthermore, eight units with a total of 127.856MW of capacity excited the market.
T-1 highlights
Econergy’s Swangate BESS was awarded 12.543MW of capacity in the auction, while Engie secured capacity for the Broxburn and Cathkin energy storage projects for 12.896MW and 12.826MW, respectively.
Several projects owned by Gresham House Energy Storage were featured in the auction, including the Tynemouth BESS, Bloxwich BESS, Grendon project and Nevendon BESS, for a total of 28.03MW.
RWE Renewables UK secured capacity across two units for a total of 10.144MW, while Statera’s Thurrock storage project secured a total of 80.72MW across three CMUs. Zenobe was also one of the largest winners in the auction, securing 54.300MW of capacity for the Blackhillock BESS and a total of 81.225MW of capacity for the Kilmarnock South project across six CMUs.
Of the awarded CMUs for existing BESS resources, 1.5MW was awarded to BESS assets with a 0.5-hour duration, 7.116MW was awarded to 1.5-hour assets, 38.752MW was awarded to 1-hour duration assets, 6.794MW was awarded to 2.5-hour assets, and 103.833MW was awarded to 2-hour duration assets.
For new build generating BESS CMUs, 1.8MW was awarded to 1-hour duration assets, 5.2MW was awarded to 1.5-hour duration assets, 375MW was awarded to 2-hour assets, 37MW to 2.5-hour assets, 38MW to 3-hour duration assets, and 100MW to 4-hour duration assets
A total of 26.083MW of solar capacity was awarded, across 19 CMUs, making up a total of 0.33% of awarded capacity. Conrad secured 2.2MW of capacity for the Larport solar project, while EDF Energy Renewables secured 5.4MW of capacity for the Beechgreen Energy Farm and 2.680MW for the Porth Wen Solar Project.
Overall, nuclear was the biggest winner with around half of capacity.
T-4 Capacity Market Auction results
The T-4 auction concluded on 11 March at 11:30am, and 43.1GW was procured across 669 CMUs. The auction cleared at a price of £60/kW/year, down from last year’s all time high clearing price of £65/kW/year.
Around 18.861MW of capacity was awarded for solar generators, across 12 market units, while 111 battery energy storage system (BESS) CMUs were awarded a total of 1.782GW of capacity. BESS represents 16.59% of all the total awarded capacity in this auction. Pumped storage was awarded 3.77% of the total capacity granted in this T-4 round, at 1.623GW across eight CMUs. Meanwhile, 17 BESS CMUs, representing 182MW of capacity, exited the market in this auction round.
Of the existing generating CMUs for energy storage assets, 21MW of capacity was awarded to 1-hour assets, 4.4MW was awarded to 2-hour assets, 2.23GW was awarded to a 12-hour pumped hydro storage project from Drax across two CMUs, while 1.4GW was awarded to a 9-hour duration storage project.
For new build generation BESS CMUs, 0.785MW of capacity was procured for 1-hour assets, 80.7MW was procured for 1.5-hour assets, while 781MW – a total of 1.82% of all capacity procured – was procured for 2-hour assets. Longer duration storage projects are making an increasingly large dent in capacity market auctions, with a total of 404MW of capacity secured for 4-hour duration projects, 189MW secured for 5-hour duration projects, 31MW secured for 6-hour projects, and almost 240MW secured for 8-hour duration projects.
For the T-4, gas won the bulk of contracts with just over half of the capacity, shown in the pie chart below.
T-4 highlights
One of the major successes in this year’s T-4 auction came for Fidra Energy, which secured 15-year awards for its 1.4GW Thorpe Marsh and 500MW West Burton C BESS projects. Both of these projects are expected to become operational in 2027; once operational, the Thorpe Marsh project will be the UK’s largest battery project.
Chris Elder, Fidra Energy’s chief executive officer, said: “The Capacity Market Auction is a key part of the UK’s energy market and the revenue certainties it provides give renewable generation and storage companies the confidence to invest in the UK market. Securing a record-breaking capacity market award for newly built battery energy storage projects is a proud moment for us and a testament to the strength of the UK’s BESS market.”
Root-Power was awarded the second-highest number of new-build contracts in the T-4 auction, with seven individual projects securing contracts. The projects have a combined capacity of 237MW and are a mix of two and four-hour systems. Neil Brooks, managing director at Root-Power said: “These results not only demonstrate the increased role that battery energy storage systems are having in delivering clean, flexible energy to the grid, but also that Root-Power is delivering on its commitment to be one of the UK’s leading IPPs in battery energy storage.”
Meanwhile, RWE has secured agreements for a total of 6.4GW of capacity, including for its Pembroke BESS, for which it landed a 15-year duration contract for 73MW of capacity.
