19 September 2025

RTC+B: How Real-Time Co-Optimization will affect Ancillary Services for batteries in ERCOT

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RTC+B: How Real-Time Co-Optimization will affect Ancillary Services for batteries in ERCOT

​In December 2025, ERCOT’s long-anticipated market change, Real-Time Co-Optimization plus Batteries (RTC+B), is set to go live.

RTC+B will reshape how batteries compete for Ancillary Services (AS) and how they manage their positions in the Real-Time Market. The shift will improve overall market efficiency while creating new opportunities and challenges for batteries.

Batteries will have more flexibility to move between Energy and AS positions in Real-Time, but will also face tighter restrictions on state-of-charge (SoC).

What is RTC+B?

For the first time in ERCOT, Ancillary Services will be procured in the Real-Time Market alongside Energy. Security-Constrained Economic Dispatch (SCED) will co-optimize both, ensuring the lowest-cost solution. This also means AS scarcity will be visible in clearing prices and locational marginal prices (LMPs).

The “+B” adds specific implications for batteries, which will now be modeled as a single resource rather than as separate generation and load resources in today’s “Combo Model.”

RTC+B also introduces SoC into ERCOT’s market-clearing processes. This will impact how SCED allocates base points and strengthen grid reliability.

Read more about the mechanics of Real-Time Co-Optimization in our initial analysis here.

​Barriers to entry in Ancillary Services are decreasing

ERCOT limits the share of each Ancillary Service that batteries can qualify for, based on how long they can sustain continuous power output at the awarded level. These duration limits are based on the ratio of a battery's energy capacity (MWh) to rated power (MW).

For example, today's requirement to provide the ERCOT Contingency Reserve Service (ECRS) states that batteries can only qualify to provide a quantity that they can sustain for two consecutive hours. Essentially, a two-hour battery can qualify for up to 100% of its rated power as ECRS in any interval. However, a one-hour battery would only be eligible to provide up to 50% of its rated power as ECRS.

Under RTC+B, these requirements are changing.

ECRS is transitioning from a 2-hour requirement to a 1-hour requirement. RRS and Regulation are being reduced from 1 hour to 30 minutes. Non-spin is remaining at 4 hours.

In theory, this shifts the AS supply curve to the right. More MW can qualify, competition rises, and clearing prices fall.

How will the new duration requirements affect the total qualified battery capacity for each of ERCOT’s Ancillary Services?

​Since most batteries in ERCOT are at least one hour in duration, the change in duration requirements for RRS and Regulation has minimal bearing on how much capacity is eligible to qualify to provide each of these services.

However, the shift to a 1-hour requirement results in a 29% increase in eligible battery capacity for ECRS.

This is because RTC+B shifts ECRS to a 1-hour requirement. A 100 MW / 120 MWh battery that was limited to 60 MW under the 2-hour rule can now offer its full 100 MW.

State-of-charge visibility adds a layer of complexity

The relaxed duration requirements potentially increase the amount of battery energy storage capacity participating in Ancillary Service markets. However, the inclusion of state-of-charge visibility in ERCOT’s market-clearing processes may actually decrease the amount of storage capacity that is eligible for Ancillary Service awards interval-to-interval.

Today, QSEs (Qualified Scheduling Entities) manage SoC themselves, ensuring batteries have sufficient stored energy to meet AS obligations. ERCOT does not directly monitor SoC in real time.

Under RTC+B, SCED will consider a battery's telemetered SoC into awards every five minutes. This is a stricter standard, particularly for providing the Non-Spinning Reserve Service. For every 1 MW of a Non-Spin award in any 5-minute interval, a battery must have 4 MWh of energy stored at the start of the interval.

Ancillary Service stacking will evolve

Currently, batteries can stack multiple AS products because duration requirements are siloed, and apply only to qualification, not procurement.

With RTC+B’s SoC visibility, batteries will be required to have enough state-of-charge to sustain full deployment of all awarded Ancillary Services simultaneously.

Consider a 150 MW / 150 MWh battery on a day in May. There is increased procurement of Non-Spin, and prices across several services are relatively high. It begins the day at full state-of-charge, and remains idle until the evening peak, when it discharges Real-Time energy.

The battery also receives Ancillary Service awards throughout the day while remaining idle. In this case, it's assumed that the reserve services are not deployed and, therefore, don't require any actual throughput.

Zooming into the operating hour between 8 and 9 AM, the battery is awarded 37.5 MW of RRS, 37.5 MW of Non-Spin, and 75 MW of ECRS in the Day-Ahead Market. Under the current duration requirements, the battery is permitted to carry each of these obligations.

But under RTC+B, the battery would be required to have 243.75 MWh of charge to be awarded the same AS stack [(37.5 * 0.5) + (37.5 * 4) + (75 * 1)]. Thus, the battery offers capacity in the service that would provide the highest revenue. Even though it can only be awarded a maximum of 37.5 MW of Non-Spin, prices are more than four times the prices of other AS, so the battery maximizes its award in Non-Spin.

At 2:00 PM, Non-Spin and ECRS prices equalize. Though the battery was able to stack additional AS under today’s duration requirements, it was only able to offer 75 MW of ECRS. Under RTC+B, the battery offers its full 150 MW capacity into ECRS.

The battery’s state-of-charge begins declining as it discharges when Real-Time energy prices peak around 8:00 PM. While it is currently able to stack Non-Spin and ECRS obligations while providing Energy today, it is limited to do so under RTC. As the battery discharges and its stored energy is diminished, the total amount of AS obligations it's able to receive also diminishes.

By the evening, after discharging energy during peak prices, the battery has 45 MWh left. RTC reduces RRS’s duration requirements to just 30 minutes - for resources providing the Primary Frequency Response (PFR) subtype - meaning the battery could offer 90 MW of RRS for the remainder of the day, as long as there is no additional throughput.

The RRS-FFR subtype has a duration requirement of just 15 minutes. The battery is alternatively able to receive an award of up to 150 MW - its full rated power - in the FFR subtype, even with the diminished SOC.

In terms of how these changes impact revenues, it isn’t exactly apples-to-apples, since RTC procures AS in Real-Time. However, applying Day-Ahead prices as a proxy shows the battery would earn about 14% less under RTC+B on this high-priced day with this operational profile, assuming all RTC+B awards were made exclusively in the Real-Time Market. The reduced revenues reflect limits from SoC checks and the inability to capture extreme Non-Spin pricing.

On more typical days, when prices are often more balanced across services, the shorter duration requirements for other services may boost opportunity, as seen in the late-day RRS commitments in the example.

What will be the net impact of RTC+B on battery Ancillary Service awards?

Duration rules are shortening, and resources can be more flexible in moving positions in Real-Time. This should increase supply and push prices down. Conversely, SoC requirements often cut into potential Ancillary Service awards throughout the most lucrative times of day. This may reduce supply and potentially lift prices.

Which force dominates will depend on real-world operations. ERCOT may see heavier competition in normal conditions, but spikes during intervals when SoC feasibility checks limit batteries.

RTC+B ultimately introduces more flexibility, but this is coupled with more complexity.