​An unconstrained two-hour battery in Germany could have earned €191k/MW/yr in August 2026, down 7% on July. On a monthly average, only one price fell: aFRR up capacity cleared at €7.35/MW/h, down 27% on July even as wholesale prices rose.

But other prices shifted as well, with FCR prices falling in exactly the morning block where they usually generate the most revenue. Higher day-ahead spreads stepped in, reallocating the battery capacity to the better arbitrage opportunity.

With strong solar, low wind in the first half of the month, and high gas prices, the month should have shown higher revenues than a year ago. But revenues fell - mostly on the back of lower aFRR capacity prices. Month-on-month, batteries are likely not the cause of the aFRR price drop - more likely wetter weather improving the conditions for pumped storage and gas plants returning from maintenance. But year-on-year, it seems like the increased competition from batteries is driving down aFRR capacity prices, showing the first clear signs of saturation happening in real-time.

Key takeaways

• An unconstrained two-hour battery could have earned €191k/MW/yr in August, down 7% on July and 15% below August 2025. Day-ahead and intraday now supply 31% of revenue against 7% last August, while aFRR capacity has gone from 88% of the total to about half.
• aFRR up capacity did the damage. It cleared at €7.35/MW/h, down 27% month-on-month and half its August 2025 level, taking about €13.7k/MW/yr out of the stack.
• Energy markets absorbed the freed-up capacity. Day-ahead TB2 spreads reached €176/MWh, up 8% on July and 35% on last August, so FCR revenue fell by a third on an essentially unchanged FCR price.
• Weather provided better conditions for batteries than a year ago — wind up 31% to 12.6GW, solar up 14% to 14.8GW, spreads 35% wider — and revenues still fell 15%. The one structural change left is the volume of prequalified battery capacity bidding into aFRR.

Unconstrained BESS revenues fell by 7% month-on-month, and by 15% year-on-year

Total BESS revenues dropped below €200k/MW/yr for the first time since March. aFRR capacity still made up about half of August's stack, at €95k/MW/yr. But year-on-year, revenues this August were 15% lower than last year, when aFRR capacity made up 88% of the total.

The competition in prices is the main driver of the change between last and this year. aFRR capacity prices have compressed while day-ahead spreads have widened, so the optimiser holds less reserve and trades more energy. Day-ahead and intraday now supply 31% of revenue, against 7% last August.

FCR was reallocated into day-ahead, while aFRR capacity revenue fell

The main driver this month was a drop in aFRR capacity prices - but the biggest difference happened in FCR.

FCR's average price eased only 1% in August, and across its six daily blocks the total value on offer fell 2.9%. At the same time, its revenue fell by a third. The reason is that day-ahead spreads widened and started paying more, so the battery sold less FCR and traded more energy.