Aurora Energy Research has released its latest battery storage performance data, showing mixed revenue results for energy storage systems across Australia’s National Electricity Market (NEM) during the first week of January 2026.
South Australia led earnings, while New South Wales experienced both losses and gains.
The NEM Weekly Battery Benchmark report from Aurora Energy Research, covering the period from 2 January to 8 January 2026, reveals that battery storage revenues per megawatt of nameplate capacity varied significantly across Australia’s eastern states, reflecting diverse market conditions and grid requirements.
South Australia recorded the strongest performance, according to Aurora Energy Research data, with battery energy storage system (BESS) revenues ranging from AU$2,096/MW (US$1,300/MW) to AU$14,271/MW.
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This highlights the state’s ongoing reliance on storage systems to maintain grid stability and facilitate the integration of renewable energy, with the high revenue ceiling reflecting premium pricing during critical grid support periods.
The state’s performance is further highlighted by its wholesale price spreads, which showed the highest arbitrage opportunities across all battery storage durations.
1-hour duration battery storage systems captured average daily wholesale spreads of AU$1,836/MWh, while 2-hour systems achieved AU$1,066/MWh, and 3-hour duration batteries recorded AU$640/MWh.
Queensland maintained consistent positive returns, with revenues spanning AU$728/MW to AU$1,291/MW, according to Aurora Energy Research.
The stable range indicates regular arbitrage opportunities as the state’s growing renewable energy capacity creates ongoing demand for storage services to balance supply fluctuations.
The state’s wholesale price spreads reflected this stability, with 1-hour duration systems achieving AU$118/MWh, 2-hour BESS capturing AU$110/MWh, and 3-hour battery storage systems recording AU$100/MWh. These moderate but consistent spreads support reliable revenue streams for BESS operators.
Victoria demonstrated moderate performance, with revenues ranging from AU$480/MW to AU$3,381/MW. The range reflects the state’s diverse energy mix and varying grid conditions, suggesting opportunities for strategically positioned battery storage systems during periods of peak demand.
Victoria’s wholesale spreads demonstrated solid arbitrage potential, with 1-hour duration BESS capturing AU$313/MWh, 2-hour systems achieving AU$240/MWh, and 3-hour batteries recording AU$184/MWh.
Meanwhile, New South Wales presented the most volatile results in Aurora Energy Research’s benchmark, with revenues ranging from -AU$48/MW to AU$1,034/MW.
The negative returns indicate periods when battery storage operators paid to charge during oversupply conditions, while positive revenues demonstrate successful arbitrage during periods of high demand.
Despite revenue volatility, New South Wales wholesale spreads showed reasonable arbitrage opportunities, with 1-hour duration batteries achieving AU$158/MWh, 2-hour systems capturing AU$136/MWh, and 3-hour BESS recording AU$112/MWh.
The first week of January saw a major heatwave hit much of Australia, particularly in the eastern states, where temperatures soared above 40°C in large areas of New South Wales, Victoria and South Australia. Some inland regions experienced consecutive days above 46°C, with the Victoria government declaring a “state of disaster” due to numerous bushfires across the ‘Garden State’.
The extreme weather event began intensifying on 7 January, with many regions recording their hottest temperatures in six or seven years.
Last week, Javier Savolainen, market development manager at Wärtsilä Energy, told ESN Premium that many grid-scale BESS installations across the East Coast provide between 2- 3 hours of storage duration, a discharge capacity that he warned falls short during multi-day extreme weather events when air conditioning demand remains elevated for extended periods.
And, despite battery performance degradation due to extreme heat throughout the heatwave, this did not prevent operators from capitalising on the revenue opportunities across the NEM’s states.
The wholesale spread data reveal a consistent pattern across all states, where shorter-duration batteries capture higher average daily spreads than longer-duration systems. This trend reflects the premium value of rapid response capabilities during peak demand periods and grid stability events.
The Energy Storage Summit Australia 2026 will be returning to Sydney on 18-19 March 2026. To secure your tickets and learn more about the event, please visit the official website.
