On June 23, 2026, the Australian government opened Tender 10 of the Capacity Investment Scheme (CIS), a procurement round seeking to contract 4 GW and 16 GWh of clean dispatchable capacity in the National Electricity Market (NEM). Bids will be accepted until August 18, and winners are indicatively expected to be announced in December. According to the government, this should be the program's last dispatchable capacity round, with further procurement only if the remaining volume is not filled. For Brazil, which is preparing its first battery-focused auction, the Australian model offers concrete benchmarks.
A policy built over almost a decade
The current round is the result of a path that began after the September 28, 2016 blackout in South Australia, when a storm brought down 33 transmission towers, the state was isolated from the rest of the NEM and around 850,000 customers lost power. The event highlighted the need for fast-responding resources to sustain frequency and stability.
In 2017, Tesla and Neoen were selected to build the Hornsdale Power Reserve, which started at 100 MW and 129 MWh and was expanded in 2020 to 150 MW and about 194 MWh. The project began operating in the energy market, frequency control, contingency response and protection schemes, and later received grid-forming controls with synthetic inertial response. The lesson: a single asset can provide multiple services, but it only creates value when rules and markets recognize those functions.
The NEM was adjusted in parallel: five-minute price settlement in 2021, a market for frequency response within two seconds in 2023 and, in 2024, a registration category that simplified the participation of batteries and hybrids as both load and generation.
How the CIS contract works
The CIS is a federal revenue underwriting policy. The current target is to enable 40 GW by 2030, comprising 26 GW of new renewable generation and 14 GW of dispatchable capacity. The main design features are:
- Revenue floor and ceiling: the project keeps selling energy and services in the market; if revenue falls below the floor, the government covers part of the gap, and if it exceeds the ceiling, a share of the gain goes back to the government.
- Term of up to 15 years, counted only from the start of operation.
- Criteria beyond price: reliability benefit, real delivery capability, bidder strength and commitments to communities, workers and First Nations peoples.
- Leaner process: since Tenders 5 and 6, technical and financial bids are submitted together, with the expectation of cutting the timeline from about nine to six months, plus a reserve list to replace projects that do not progress.
Higher-than-expected competition
In Tender 8, whose winners were announced one day after Tender 10 opened, 73 bids totaled 76.4 GWh against a 16 GWh target. Fifteen projects were selected, all of them storage, totaling 4.2 GW and 16.1 GWh. This investor appetite allowed the government to raise, in July 2025, the dispatchable capacity target from 9 GW to 14 GW, which Tender 10 now seeks to complete.
What changes in practice for the Brazilian BESS market
Brazil has moved past the conceptual stage: ANEEL has regulated storage systems, and the 2026 LRCAP, a capacity reserve auction that contracts resources to ensure supply at the system's most demanding moments, puts the topic on the concrete agenda. The challenge is to provide continuity and predictability after the first auction.
- Developers gain a contract benchmark that reduces financing risk without locking the asset into fixed revenue, a useful argument in discussions about the design of upcoming auctions.
- EPCs should prepare for criteria that value proven delivery capability and realistic construction timelines.
- Manufacturers and suppliers need to look at features such as grid-forming control and fast frequency response, which tend to gain value as regulation recognizes these services.
The Australian experience shows that stable rules, coordination of access and connection, and efficient cost allocation are what turn batteries from a one-off solution into a structural part of the expansion and operation of the SIN.
Original source: ABSAE — A AUSTRÁLIA ABRE UMA NOVA RODADA PARA BATERIAS