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Aurora’s Battery Benchmark: Bridging the Gap Between Revenue Indices and Forecasts

Our Battery Benchmark for Germany provides transparency on the historical performance of a 2-hour battery system optimised across wholesale, ancillary, and balancing markets.

Aurora’s Battery Benchmark – Key Insights into Germany’s Battery Market

Our benchmark tracks historical revenues for a 2-hour battery system using Chronos, our battery trader simulation software. Unlike models with perfect foresight, Chronos simulates real-world conditions, optimising battery dispatch across multiple markets with imperfect foresight. 

This methodology, is also used in our German Flexibility reports, ensuring consistency in our battery business case analysis. Our Battery Benchmark is, therefore, the first index in Germany to use a consistent methodology for both historical backcasting and revenue forecasting—bridging the gap between battery indices and future projections. 

The full methodology, as outlined in the chart below, uses Chronos to simulate the optimised dispatch behaviour based on historical prices for wholesale and balancing markets.

Seasonal Trends: Summer is the Hottest Season! 

The Battery Benchmark shows a clear seasonal trend, with summer revenues twice as high as winter ones. High solar generation in summer pushes midday prices down while gas assets drive evening prices up, resulting in average daily price spreads exceeding 150€/MWh. In winter, gas and coal plants operate continuously, creating more stable price patterns and reducing revenue potential for batteries. 

Making Sense of Differing Battery Indices 

Several revenue indices track battery storage potential in Germany, each with different methodologies and assumptions. While our Chronos model delivered higher revenues than other indices until October, its returns were slightly lower in November and December.

Why the difference? Modelling assumptions, like perfect vs. imperfect foresight make a huge difference, especially in months with many extreme prices.

Curious what the future holds? Based on our in-house long-term scenarios, we forecast the future revenues for batteries as part of our German Flex Market report. 

Get in touch with our Commercial Associate for the DACH region, Kevin Cabellero, to find out more.