Battery cannibalization · refreshed to July 2026

Two markets, one direction, two different clocks

The v3 chart indexed CAISO and the NEM to 2023 = 100 on one axis. That is no longer defensible: the NEM figures published since are six-month windows and annualised months in Australian dollars, which do not aggregate to a calendar year. Indexing them onto a shared base would manufacture a comparison the sources do not support, so each market is shown at the resolution it actually reports.

CAISO · net market revenue per kW-year

0 25 50 75 100 103 2022 DMM basis 80 2023 51 2024 38 2025 Modo estimate 21 2026 Jan pace, not outturn USD per kW per year

NEM · revenue per MW-year at the periods Modo reports

0 25 50 75 100 125 118 Oct 2024 – Mar 2025 implied from the -38% 73 Oct 2025 – Mar 2026 reported 54 Feb 2026 month, annualised 35 Jun 2026 month, annualised AUD thousand per MW per year

CAISO is now a clean series

Modo's benchmark gives $80/kW in 2023, $51 in 2024 and a 2025 landing just below $40, and January 2026 annualises to $21. That is a fall of roughly three quarters in three years against a fleet that went from about 0.5 GW in 2020 to 15.5 GW.

This also resolves a flag from earlier: the $38 in your model for 2025 is consistent with Modo's estimate, so it can stay.

The source mixing turned out to be harmless

Your series takes $103 for 2022 from CAISO's DMM and the later years from Modo's benchmark. The two are constructed differently, but where they overlap they nearly coincide: DMM has $78 and $53 for 2023 and 2024 against Modo's $80 and $51. The mixing does not distort the trend, though the basis is worth a footnote.

Why the NEM panel looks different

Modo's own 2025 review publishes no annual $/MW figure. What exists is the October–March window at A$73k/MW/year, down 38%, plus annualised months: A$54k in February and A$35k in June after a 22% rebound on a wind drought and South Australian price-cap events.

The A$148k for 2024 in your model could not be reconciled with these on a common basis, and one source puts 2024 at A$50–70k/MW/year. Currency and net-versus-gross are both ambiguous across sources. I would not publish the NEM series until that is settled with one provider.

Structural and cyclical, kept apart

Both markets are falling for the structural reason: fleets grew and the arbitrageurs compete away the spread they live on. The NEM fleet more than doubled from 2 GW to 4.6 GW during 2025 alone.

But 2025 in California was exceptionally mild, which Modo names as the main reason its markets were calm, and the NEM's June 2026 rebound came from weather too. Neither the depth of the 2025 fall nor the 2026 uptick should be read as purely structural.

CAISO: Modo Energy and CAISO DMM 2024 special report; January 2026 pace from Modo. NEM: Modo six-month review and Modo, May and June 2026. Dashed bars are estimates or implied values, not reported outturns.