New market design lets batteries trade without constant bidding
A single end-of-horizon SOC bid replaces complex intraday offers for storage.
Ross Baldick, in a new technical reference paper posted to arXiv on June 12, 2026, presents a market design framework that treats energy storage as a first-class participant in electricity markets. The key innovation is a state-of-charge (SOC) based formulation that captures the physical realities of batteries, such as round-trip efficiency and SOC limits, without burdening storage owners with continuous bidding. Instead, the owner submits a single end-of-horizon bid/offer that compensates for any deviation between the final SOC and the starting SOC. This design effectively decouples the intraday scheduling of charging/discharging from the need to forecast prices and submit multiple orders.
The paper includes small illustrative examples and discusses large-scale implementation, with extensions sketched in appendices. By removing the requirement for intraday bids, Baldick's approach lowers the operational complexity for storage participants and could accelerate integration of grid-scale batteries into wholesale power markets. The work targets systems engineers and market designers looking to align incentive structures with the technical characteristics of storage, potentially reducing gaming and increasing efficiency.
- Market design uses state-of-charge (SOC) and round-trip efficiency as primary parameters
- Only requires an end-of-horizon bid/offer for deviating SOC, no intraday bids needed
- Includes small examples and outlines large-scale implementation strategies
Why It Matters
Simplifies battery market participation, cutting operational overhead and enabling more efficient grid-scale storage deployment.