Capacity Market Revenue Calculator
Capacity markets pay resources for being available during system stress — separate from the energy they actually sell. A battery that clears an auction like PJM's Base Residual Auction earns a fixed price per MW of accredited capacity per day for an entire delivery year. This calculator converts nameplate power, an ELCC-based capacity accreditation factor, a capacity price, and a delivery period into unforced capacity (UCAP), annual capacity revenue, and revenue per MW-year. Pair it with our Battery Arbitrage Revenue Calculator and Frequency Regulation Revenue Calculator — together those three tools model the standard BESS revenue-stacking strategy — and our Behind-the-Meter BESS ROI Calculator for the customer-side economics.
The rated power output of the battery system in MW.
Selecting a duration auto-fills the accreditation factor below (still editable).
Only the 4-hour value (58%) reflects current, verified PJM data (2027/28 delivery year). Other durations are illustrative — replace with your ISO's published accreditation values.
PJM's 2027/28 Base Residual Auction cleared at this price (the FERC-approved cap). Capacity prices vary significantly by ISO/RTO and delivery year — adjust for your market.
Length of the capacity delivery year.
nameplate MW × accreditation factor — the capacity the grid operator counts on and pays for
UCAP (MW) × capacity price ($/MW-day) × delivery period (days)
annual capacity revenue ÷ nameplate power capacity
Results update live as you type. For planning and field-check estimates — always verify against applicable standards and equipment ratings.
How we calculate this →The cap is doing a lot of work. PJM's capacity price has been capped at $333.44/MW-day for the 2027/28 delivery year — without that cap, PJM's own simulation shows the market would clear at $555/MW-day, 71% higher. That's how tight PJM's capacity balance has become. Meanwhile, battery accreditation keeps inching up as ELCC studies improve — 4-hour systems went from 58% to 59% in a single year — meaning today's revenue estimate is likely conservative relative to what a battery earns as its accredited capacity value continues to rise.
How capacity market revenue is calculated
Capacity markets pay resources for being available to produce power during system stress periods, separate from the energy they actually sell. A battery earns capacity revenue by clearing an auction (such as PJM's Base Residual Auction) and then receiving a fixed price per MW of accredited capacity per day across an entire delivery year. Three quantities tie the calculation together.
Unforced Capacity (UCAP, MW) = nameplate power capacity (MW) × capacity accreditation factor (% ÷ 100). The accreditation factor comes from Effective Load Carrying Capability (ELCC) studies that estimate how reliably a resource can perform during the system's highest-risk hours. A 4-hour battery cannot sustain output as long as a natural gas plant during an extended stress event, so it is credited at a fraction of its nameplate — currently 58% for 4-hour systems in PJM's 2027/28 delivery year. At 100 MW nameplate and 58% accreditation, UCAP is 58 MW.
Annual Capacity Revenue ($) = UCAP (MW) × capacity price ($/MW-day) × delivery period (days). The capacity price is the auction clearing price paid per MW of accredited capacity per day; PJM's 2027/28 Base Residual Auction cleared at $333.44/MW-day (the FERC-approved price cap). The delivery period is the length of the capacity delivery year, typically 365 days. At 58 MW UCAP, $333.44/MW-day, and 365 days, annual capacity revenue is roughly $7,058,930.
Capacity Revenue per MW-Year ($/MW-year) = annual capacity revenue ÷ nameplate power capacity (MW). This normalizes revenue against the project's nameplate size so projects of different scales can be compared on the same basis. At the defaults, that is about $70,589/MW-year.
Battery duration drives accreditation, which in turn drives UCAP and revenue: longer-duration batteries can sustain output through longer stress events, so they receive higher accreditation factors and earn more revenue per MW of nameplate. Only the 4-hour accreditation value (58%) reflects current, verified PJM data for the 2027/28 delivery year; the other duration values are illustrative and should be replaced with your ISO's published accreditation figures. Capacity prices, accreditation methodologies, and delivery-year timing vary across ISOs/RTOs (PJM, ISO-NE, NYISO, MISO, etc.), and ERCOT does not operate a traditional capacity market at all — always use your specific market's current data. Data sources: PJM 2027/2028 Base Residual Auction clearing price ($333.44/MW-day, FERC-approved price cap); 4-hour battery capacity accreditation (58% for 2027/28 delivery year, verified PJM/Modo Energy data); ELCC-based accreditation scaling for other durations (illustrative); PJM capacity market price-cap analysis.