Whoever invests in storage needs to set from the outset when the business case will be reviewed

At Crucero, in northern Chile, the arbitrage margin of a hypothetical 4-hour battery, with perfect foresight, fell in 12 months.

It went from 137 to 105 USD/kW per year. In that period, system storage power rose from about 1.2 to 3.2 GW during 2025. These data cannot isolate how much of the decline is attributable to batteries. The average price across all hours also fell, from 51 to 43 USD/MWh.

The transitional regime that recognizes capacity for batteries lasts 10 years from July 2024, against an assumed 15-year life. A battery entering in October 2026 would have some 7.75 years under that regime.

An evaluation performed only once, when bidding, leaves investors without a rule for knowing when their business case has ceased to hold. The proposal is to set, before committing capital, the indicators that trigger review, with their value, responsible person, and planned action. This is cycle 2 of the Capital Projects Decision System.

Which indicator triggers a review of your business case today?

The full Perspective, with its sources, is available on request.