Are conventional BESS degradation guarantees restricting asset value?
energy-storage.news Aug 20, 2026

Are conventional BESS degradation guarantees restricting asset value?

AI-summarised brief · reviewed before publication

In Australia’s National Electricity Market, battery energy storage system (BESS) owners face operational limits tied to degradation guarantees that can curtail revenue potential. Envision Energy’s Faisal Mohd explains that warranties often restrict cycling, state‑of‑charge, temperature, and power rates to protect battery health. These constraints, while safeguarding performance, can prevent owners from exploiting shifting market conditions such as energy arbitrage or peak‑price dispatch. Recent data shows NEM batteries captured only 38 % of their theoretical revenue, underscoring the financial impact of rigid guarantees.

💡 Why It Matters

  • · The tension between warranty protection and market flexibility directly affects the economic viability of BESS projects, influencing investment decisions and the broader adoption of grid‑scale storage.