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LIVESTREAM: The Investment Case for BESS in Spain

2026-07-23 · 10:14 UTC ·Modo Energy ·1 min read

Brief

Modo Energy's livestream (23 July 2026) — a presentation plus live Ko demo — lays out the investment case for BESS in Spain: record‑low wholesale prices, a new pay‑as‑bid capacity market with a €9bn budget, and a generation‑tax phase‑out by 2028. The talk shows a collapsing solar capture price (Q2–Q3 2026), revenue‑stack revisions (April → July), Ko virtual‑battery workflows, and aFRR cannibalization risks.

Why it matters

Spain has the cheapest wholesale power prices in Europe (July 2026); a newly approved capacity market uses a pay‑as‑bid design with de‑rating factors and a €9 billion budget, and the generation tax is scheduled to phase out by 2028.

Key details

  • Solar capture prices collapsed in Q2–Q3 2026 with many solar hours hitting zero; Modo's July revision further lowered capture price estimates and produced a material downward shift in merchant revenue projections for solar + BESS between the April and July releases.
  • Presenters Pablo Martinez (Head of Iberia) and Pablo Brito demoed building a virtual battery in Ko and benchmarking it against the live fleet, highlighted solar+battery colocation and grid‑charging rights, and warned that aFRR capacity cannibalization (observed in GB and ERCOT) risks eroding frequency‑response revenues for BESS.
Source evidence

Try Ko for free in the Modo Energy terminal: https://modoenergy.com

Spain now has the cheapest wholesale power prices in Europe, a newly approved capacity market, and a solar capture price that keeps falling. So what does that mean for battery storage investors?

Pablo Martinez (Head of Iberia) and Pablo Brito (Market Analyst, Iberia) walk through Modo's latest view on the Spanish BESS market: where power prices are heading, how the regulatory landscape is shifting, and how batteries stack up on revenue today versus the second half of the decade.

What we cover:

Spanish power prices vs Germany, GB, Poland and Italy
Why Q2 and Q3 solar hours keep hitting zero
The generation tax phase-out (gone by 2028)
Spain's newly approved capacity market: pay-as-bid design, de-rating factors, and how the €9bn budget compares to GB and Italy
Solar + battery colocation and grid charging rights
The four flexible demand categories proposed by the CNMC
How to build a virtual battery in Ko and benchmark against the live fleet
Revenue stack shifts between our April and July releases
aFRR capacity cannibalization: what GB and ERCOT tell us about what's next

Chapters:
00:00 Welcome and what we'll cover
00:52 About Modo Energy and Ko
02:27 Spanish power prices vs Europe
04:27 Negative price hours: how deep, how often
08:27 Solar capture price: the collapse and the July revision
12:27 Regulatory changes: the generation tax
15:12 The Spanish capacity market
21:17 Solar + battery colocation
23:27 Flexible demand and grid connection
26:37 Spanish market structure (OMIE, intraday, technical restrictions, aFRR)
29:02 Live demo: virtual batteries in Ko
32:27 Battery revenue stack: April vs July release
34:47 aFRR capacity cannibalization
36:47 Q&A
48:27 Wrap-up

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Channel: Modo Energy
Published: 2026-07-23
Video URL: https://www.youtube.com/watch?v=Srcp-AJMxFI