Europe’s 15‑minute power trading can lift BESS ROI by ~3%. Here’s how battery investors and operators can capture that value with AI‑driven optimisation.
Most battery investors obsess over chemistry and capex and then leave 3–5% of their returns on the trading table.
That’s the real story behind Europe’s shift to 15‑minute settlement. It’s not just a regulatory tweak; it’s a structural change in how flexible assets like battery energy storage systems (BESS) get paid for their agility. For green technology and clean energy investors, that matters more than another marginal efficiency gain.
The latest analysis from Rystad Energy points to around a 3% uplift in long‑term ROI for European battery storage from 15‑minute trading. In a sector where returns are squeezed by falling frequency revenues and rising competition, 3% over 20 years can make or break a project finance case.
This post breaks down what’s happening, why it matters for battery storage economics, and how AI‑driven optimisation is becoming the quiet engine of green technology profitability.
What 15‑Minute Settlement Actually Changes for Batteries
The key impact of 15‑minute settlement is simple: more price points, more volatility captured, more arbitrage value for flexible assets.
Until recently, most European day‑ahead markets settled on hourly products: 24 time intervals per day. Now, markets such as EPEX SPOT offer 96 trading intervals. That extra granularity better reflects how solar and wind truly behave — spiky, not smooth.
Why battery arbitrage improves
Here’s the thing about grid‑scale batteries:
- They don’t care what time resolution the market uses.
- They do care how often prices move enough to justify cycling.
By moving from 60‑minute to 15‑minute Market Time Units (MTUs):
- Short‑lived price spikes are no longer averaged away inside an hour.
- Batteries can buy during a 15‑minute trough and sell during a 15‑minute peak, instead of hoping those moves line up neatly inside the same 60‑minute block.
Rystad Energy’s modelling shows:
- Arbitrage margins today average around US$150/MWh in some markets (though they see US$60/MWh as a more realistic long‑term level).
- On average, arbitrage potential increases ~14% with 15‑minute settlement vs hourly.
- In some countries, potential arbitrage profits rise 15–25%.
That doesn’t automatically translate 1:1 into realised revenues — but it’s a larger pie to optimise against.
Country differences: why Austria wins and Portugal doesn’t
Not every market gets the same benefit.
- Austria: With a high share of intermittent renewables and less inherent flexibility, price swings within the hour are sharper. Rystad estimates >25% increase in arbitrage potential, with modelled revenues around US$107/MWh (assuming one full cycle per day and perfect foresight).
- Portugal: With flexible hydropower and gas in the mix, intrahour prices are smoother. Here, 15‑minute trading only yields ~3% uplift, with batteries seeing around US$89/MWh in arbitrage under similar assumptions.
The pattern is clear:
Markets with lots of wind and solar and limited flexible generation gain the most from shorter settlement periods.
If you’re planning a European BESS pipeline for 2026–2030, this difference in intrahour volatility is as important as headline average prices.
From Arbitrage Margins to Return on Investment
Rystad’s conclusion is blunt: around a 20% increase in annual arbitrage earnings can translate to roughly 3% higher ROI over 20 years for a battery asset.
That doesn’t sound dramatic on paper. In reality, it’s very material.
Why 3% ROI uplift matters for green technology investors
Most utility‑scale BESS projects in Europe are now largely merchant or merchant‑heavy. Lenders and equity sponsors are asking tougher questions:
- How robust is the revenue stack if ancillary markets saturate?
- What happens if capture prices for renewables compress faster than expected?
- Can the battery make money only from energy arbitrage plus some balancing services?
In that context:
- A 3% ROI uplift can make marginal projects bankable.
- It can offset degradation‑driven capex later in life (augmentation or repowering).
- It directly strengthens the business case for more storage on the system, which in turn supports more renewable integration.
This is where the green technology story is bigger than just batteries. More profitable storage assets mean:
- Fewer curtailment events for wind and solar.
- Better utilisation of existing grid infrastructure.
- Lower system costs for balancing intermittent renewables.
In other words, the trading rule change that boosts your BESS P&L also supports the decarbonisation of the wider power system.
The caveats investors can’t ignore
Rystad is clear that their arbitrage numbers are “perfect foresight” style. Reality knocks those back. Why?
- Efficiency losses: Round‑trip efficiency (RTE) eats into gross spreads.
- Availability: Batteries aren’t at 100% uptime across 20 years.
- Market liquidity: Sparse order books can limit the ability to fully monetise spikes.
- Risk management: Sensible operators don’t chase every price spike; they hedge and smooth revenue.
So you don’t get the full 20% uplift in practice. But the structural upside is there — and that’s exactly where AI‑driven optimisation comes in.
What Australia’s 5‑Minute Market Teaches Europe
If you want a preview of where Europe is heading, look at Australia’s National Electricity Market (NEM).
The NEM shifted from 30‑minute to 5‑minute settlement in 2021. Since then:
- In New South Wales, yearly arbitrage revenues have increased by around 20%.
- In Victoria, the uplift for 1‑hour arbitrage strategies is around 15%.
The pattern mirrors Europe’s move to 15‑minute intervals: finer granularity consistently increases arbitrage profits for flexible assets.
Why human traders can’t keep up
There’s a catch. As Sahand Karimi (OptiGrid) has pointed out for the NEM, 5‑minute volatility is simply too fast and too complex for manual trading desks.
Truly “intelligent bidding” means:
- Simulating multiple price and dispatch scenarios over the next several intervals.
- Stacking bids simultaneously in different markets (energy, FCAS/ancillaries, balancing).
- Managing risk so you don’t get dispatched in a bad interval that erases a day’s profits.
That’s not a job for a spreadsheet and a couple of traders watching a screen. It’s exactly where AI, machine learning, and advanced optimisation software become central to the battery business model.
And this is the broader green technology story: the value of a BESS is no longer just about hardware. It’s about algorithms, forecasting, and automation that can monetise volatility without blowing up risk.
How AI Optimisation Turns 15‑Minute Markets into Profit
In a 15‑minute world, the winners are operators who pair high‑quality assets with high‑quality optimisation software.
Core capabilities you need
To really benefit from 15‑minute settlement, a BESS optimisation stack should be able to:
-
Forecast intrahour prices and renewables
Use machine learning models trained on granular historical data to predict:- 15‑minute price spreads
- Wind and solar output ramps
- Congestion patterns and constraint risks
-
Optimise multi‑market participation
Arbitrage is only one value stream. The real money comes from:- Day‑ahead and intraday energy markets
- Balancing and ancillary services
- Capacity or flexibility schemes where available
Good software can co‑optimise across these, not just chase the highest single price.
-
Respect technical and degradation constraints
Smart scheduling must factor in:- State of charge limits
- Cycle depth and degradation models
- Temperature and availability windows
Otherwise you might “win” this year and pay for it with excessive degradation later.
-
React in real time
When a volatility event hits, you want the system to adjust bids automatically within seconds, not wait for a trader to react.
Practical actions for developers and asset owners
If you’re developing or operating BESS in Europe right now, here’s what I’d prioritise:
-
Update your financial model
- Include 15‑minute settlement assumptions explicitly.
- Run sensitivities on arbitrage spreads (+10%, +20%, +25%) for your target markets.
-
Benchmark your control and trading stack
- Are you still relying on manual trading or simple rules‑based logic?
- If yes, assume you’re leaving a chunk of that 3% ROI uplift on the table.
-
Invest early in optimisation partners
- Include AI‑based optimisers in your RFPs, not as an afterthought.
- Ask for evidence: realised performance vs perfect‑foresight backtests.
-
Design assets for flexibility, not just capacity
- Faster response, flexible operating windows, and robust telemetry all enhance the value that optimisers can extract.
This is the quiet shift in green technology: the centre of gravity is moving from “build more megawatt‑hours” to “operate smarter per megawatt‑hour”.
What This Means for the Future of Green Technology
Europe’s move to 15‑minute settlement is more than a trading nuance. It’s a structural upgrade to how we pay for flexibility, and flexibility is what lets renewables scale without breaking the grid.
For the green technology ecosystem, the implications are clear:
- Batteries become more investable, with higher and more diversified revenue potential.
- AI and optimisation software become core infrastructure, not optional add‑ons.
- Grids can accommodate higher shares of wind and solar, because someone is finally paid properly to handle their volatility.
If your business touches energy storage — as an investor, developer, off‑taker or technology provider — the move to shorter settlement is a direct signal:
The next phase of clean energy growth belongs to those who can match physical flexibility with digital intelligence.
The hardware is here. The market structure is catching up. The question now is whether your optimisation strategy is ready to claim that extra 3%.
FAQ: Quick Answers for Decision‑Makers
Does 15‑minute settlement automatically increase my BESS revenue?
No. It increases the available arbitrage opportunity. To capture it, you need strong optimisation, forecasting, and risk management.
Is the 3% ROI uplift guaranteed?
No, it’s an estimate based on assumptions such as 20% higher arbitrage earnings, perfect foresight, and one full cycle per day. Real‑world results depend on your market, asset design, and trading strategy.
Which European markets benefit most?
Markets with high wind/solar shares and limited flexible generation (like Austria) see 15–25% higher arbitrage potential. Hydropower‑rich, more flexible systems (like Norway or Portugal) see smaller gains.
Where does AI fit in the green technology story here?
AI is what turns finer market granularity into stable revenue. It forecasts, optimises, and dispatches batteries in ways human traders can’t match at 15‑minute or 5‑minute resolution.