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Igor Sabodakha

Battery Storage Investment Calculator

Base case

Fictional project “Batteriespeicher Musterfeld” · 50 MW / 100 MWh (2 h) · Germany · a tolling contract and day-ahead trading

Illustrative calculation — not investment, tax or legal advice. Fictional case. Prices to 30 Sep 2026.

How the model works →Sources →

Investor IRR −3.0%

What would the toll have to pay?

At this toll price, the project does not earn the hurdle rate.

The investor breaks even at a toll of €229,000 per MW a year — against €120,000 in these inputs.

Tolling offers quoted in the market for 2-hour batteries: €110,000–€150,000 per MW a year (a benchmark, not an offer).

A scenario of the day-ahead market only, without the intraday market and reserves, which gave the main revenue of German batteries in 2026. Nothing is tuned to reach a target.

Why the break-even price is above the market
  1. No reserves (FCR, aFRR) and no intraday trading — in 2026 they earned most of German batteries’ revenue. The market share and the years after the toll trade day-ahead only.
  2. A fully amortising 10-year loan instead of the usual 7-year mini-perm with 70–80% debt.
  3. Investment of about €765 per kW for 2 hours, against about €700 in Modo Energy’s benchmark.
  4. A 15-year life, with no value after it.

How the money flows

In 2029, the first full year, the toller pays €96k per MW for 80% of the battery; the rest earns €12k per MW on the day-ahead market — €108k per MW in all.

Operating costs and grid charges take €24k per MW, which leaves EBITDA of €84k per MW.

Building the battery costs €38.3m (€765 per kW). The bank looks at the low spread path and lends €17.8m — 44% of the cost without VAT; the owner pays in €24.3m.

Batteries are added in 2038 to restore capacity, and the inverters are overhauled in 2040. The company keeps the cash these need instead of paying it out.

The investor earns −3.0% a year against a hurdle of 12%.

Revenue and cash by year

€ million, nominal.

  • Toll fee
  • Day-ahead trading
  • Operating costs
  • Cash for debt service
−20246202820302032203420362038204020422043

Model and text: Igor Sabodakha · Prices: Bundesnetzagentur | SMARD.de via Energy-Charts (CC BY 4.0), derived statistics only · Methodology v1.2 R2.4 · revenue library DE v1