However, this could change in the coming years. With declining capital expenditure costs for battery projects and a shift toward Energy arbitrage as the primary revenue stream, the investment case of four-hour duration batteries may be becoming more attractive to investors.

This article lays out the investment case for four-hour batteries in ERCOT today. Costs and revenues are constantly shifting, and market conditions may be moving in a direction that favors longer durations. Some developers are already making the move, as evidenced by some longer-duration resources entering the ERCOT Interconnection Queue.

If you have any questions regarding the content of this article, reach out to the author at alex.dediego@modoenergy.com. To learn more about subscribing to Modo Energy’s research, click here.

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The investment case for four-hour batteries in ERCOT

The investment case for four-hour batteries in ERCOT

​Executive Summary

Constraints in Great Britain: Scottish wind curtailment and what it means for BESS

Italy's Capacity Market: Terna’s Proposal Shifts Advantage from Batteries to Gas

​February 2026 NEM battery revenues fell to $54k/MW/year, the lowest level in two years

German grid fees: Where batteries win and lose under dynamic pricing

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Executive Summary

February 2026 NEM battery revenues fell to $54k/MW/year, the lowest level in two years