Batteries now set the Wholesale Electricity Market (WEM) price more often than any other technology. In July 2026, batteries set the price in 90.7% of dispatch intervals, up from 17.6% in January 2025.

Most battery-set prices now come from the charging side. In 58% of intervals where batteries set the price, the marginal offer came from a battery charging offer.

Gas and coal set the price in under 4% of intervals each in July 2026. The market price increasingly reflects what a battery is willing to pay to charge, rather than what a generator needs to earn to run.

The Economic Regulation Authority (ERA) has opened its Offer Construction Guideline for review. The review covers how batteries should value charging when future energy and FCESS opportunities remain uncertain, when repeated offer revisions reflect updated opportunity cost, and whether charging offers should reflect only the asset’s own efficient cost or wider portfolio incentives.

This article analyses how battery charging offers, offer revisions, price-setting behaviour and portfolio-level outcomes changed from January 2025 to August 2026.

Executive summary

• ​Batteries set the WEM price in 90.7% of dispatch intervals in July 2026, compared with 17.6% in January 2025.
• Charging offers are now central to price formation. They accounted for 58% of battery-set intervals in July 2026, meaning the price increasingly reflects what batteries are willing to pay to charge.
• Battery charging costs rely on forecast opportunity cost. On 12 July, pre-dispatch forecasts for a single interval moved by more than $300/MWh through the day.
• Portfolio ownership changes the economics of high-price charging. Across 71 high-price charging days, Synergy’s batteries paid $7.3M to charge whilst its generation earned $18.4M.
• Clearer charging-offer rules would change how operators justify their bids. Operators may need stronger evidence for opportunity cost assumptions, offer revisions and portfolio-linked charging behaviour.

Issue 1: battery charging costs depend on forecast opportunity cost

The ERA needs to define how batteries should turn uncertain future value into a charging offer.

Current WEM rules require generators to offer capacity at efficient variable cost (EVC). For thermal units, that cost is mostly tied to fuel and operating costs.

For batteries, efficient variable cost is harder to define. A charging offer needs to account for what stored energy could earn later through energy dispatch, FCESS, or avoided high-price charging. An operator deciding how much to pay for energy at 10 am is also forming a view on what that energy could be worth later in the day.

Pre-dispatch forecasts show how much that view can change. On 12 July, forecasts for a single interval moved by more than $300/MWh through the day, even though the settled price stayed close to $110/MWh.

Forecast variation matters for the ERA review. If charging offers must be built on opportunity cost, the guideline needs to define how far forward an operator can look, and what evidence supports that forecast.

Forecast uncertainty also shows up in realised trading outcomes. A battery only earns from arbitrage when it discharges at a higher price than it paid to charge, after accounting for round-trip losses.

​Synergy’s realised spread has fallen toward zero and recorded negative outcomes in three of the past four months. Neoen’s spread remained positive over the same period.

Both fleets discharge into the same market. The difference is on the charging side, where Synergy’s batteries have paid more for energy and captured less of the available spread.

That does not indicate a rule breach on its own. It shows why charging offers are now central to battery economics, and why the ERA review needs clearer guidance on how charging opportunity cost should be formed. The issue is likely to become more important under Energy Policy WA’s proposed state-of-charge mandate. Under that proposal, AEMO could direct batteries to charge before a likely system stress event, which the ERA notes “may also increase market prices before an ESROI period.”

Issue 2: frequent offer revisions need clearer justification

The ERA needs to clarify what evidence supports a revised offer when that offer can move the market price.

Battery offers change more often than thermal offers because battery opportunity cost changes through the day. Forecasts move, state of charge changes, and the value of charging or discharging shifts with each interval.

That makes frequent revisions a normal feature of battery operation.

Batteries rebid twice as often as the rest of the fleet when normalised by capacity. This reflects the difference between fuel cost and opportunity cost. A thermal unit’s cost changes slowly, whilst a battery’s opportunity cost changes whenever the value of stored energy changes.

The policy issue is not the number of revisions. The ERA has already said frequent changes do not, on their own, indicate a problem. The question is what evidence supports each revised offer when that offer affects the market price.

​On 12 July, Synergy’s charging offer sat close to the clearing price for much of the day because it was often the marginal offer. When Synergy revised its charging offer upward, the clearing price moved with it, and the fleet continued charging through the higher price.

That creates the circularity the ERA review needs to address.

A battery’s charging offer should reflect opportunity cost, but in these intervals the observed market price is being set by the same offer used to justify it.

Synergy and Neoen revised offers at similar rates. The difference was where those revisions landed. Synergy’s charging offers were more often at the margin, so the same type of behaviour had a larger effect on market prices.

Issue 3: portfolio incentives can affect charging offers

The ERA needs to separate the cost of operating the battery from the value created elsewhere in the portfolio.

​A high charging offer increases the price paid by the battery, but it can also increase the price earned by generation in the same portfolio. This matters most for participants that own both batteries and generation.

​On 12 July, Synergy’s batteries charged through both high-price windows. Its gas and coal units were generating at the same time, so the portfolio was buying and selling into the same price event.

For a standalone battery, charging through a high-price interval is a cost. For a portfolio with generation, that cost can be offset by higher generation revenue elsewhere in the portfolio.

The question is whether the charging offer helped sustain the price. AEMO’s published offer stack allows the same day to be re-cleared with Synergy’s charging offers flattened, whilst holding the energy it bought constant.

​Under the submitted offers, Synergy charged through the afternoon peak. Under a flat charging offer, the same energy was bought in cheaper intervals, and the peak price was lower.

The charging offer helped support the price in the same window that Synergy’s generation was selling into.

Across high-price charging days, Synergy’s generation earned more than its batteries paid to charge in almost every case. A standalone battery cannot offset high charging costs with generation revenue from the same price event.

​Dispatch data cannot prove why a battery charges above the day’s average price. Capacity obligations, forecast error and portfolio incentives can all produce higher charging offers.

The ERA’s role is to clarify which costs belong inside a battery’s efficient variable cost. Portfolio benefits are already excluded from EVC. The question is how directly the guideline tests for that in charging offers

What this means for WEM battery revenues

Battery charging offers now affect market-wide price formation. In July 2026, batteries set the WEM price in more than 90% of dispatch intervals, with charging offers accounting for the larger share.

Clearer guidance would change how operators justify charging behaviour. Opportunity cost assumptions, offer revisions and portfolio-linked charging offers would likely need stronger evidence behind them.

Standalone batteries would benefit most from lower charging prices. If tighter guidance lowers the price floor, realised spreads would widen for batteries that only earn from arbitrage and FCESS.

Portfolio-backed batteries face a different trade-off. Lower charging prices would reduce battery charging costs, but could also reduce generation revenue earned elsewhere in the portfolio.

The main policy question is where efficient variable cost ends. If the ERA tightens the treatment of opportunity cost, rebidding evidence and portfolio incentives, battery charging offers become easier to assess and harder to justify through portfolio-level benefits.