For nearly three weeks, a group of grid-side independent energy storage projects in Shaanxi have been waiting for a "window period." The wait began on August 1st, when the province's capacity electricity pricing policy for grid-side independent new energy storage officially took effect. Under this policy, the capacity price is set at 165 yuan per kilowatt per year (tax included), with a compensation rule based on the longest annual net load peak duration (provisionally set at 6 hours), now entering the operational phase.

This detailed regulation, which falls under the framework of the National Development and Reform Commission and the National Energy Administration's "Notice on Improving the Capacity Pricing Mechanism for the Generation Side" (Document No. 114, issued January 27, 2026), was implemented by the Shaanxi Provincial Development and Reform Commission's "Notice on Matters Concerning Capacity Electricity Pricing for Grid-Side Independent New Energy Storage" (Document No. 924, issued July 2026, effective August 1st). It provides institutional baseline revenue for grid-side independent storage in Shaanxi.

Zhou Shengmin, an industry practitioner in the northwest's energy storage sector, noted that the project admission list that determines whether enterprises can receive capacity electricity payments has not yet been publicly released. For instance, storage projects that have already completed filing and are in the pre-grid-connection preparation stage are still waiting for this window. Zhou gave an example: the policy anchors the baseline duration at 6 hours, based on calculations from Shaanxi's annual net load curve, corresponding to the period when the evening-to-night power supply gap is most concentrated. According to the policy formula, blindly extending storage discharge duration just to maximize capacity payments is not entirely cost-effective.

A local Shaanxi Development and Reform Commission official used an analogy, saying that for storage investors, 165 yuan per kW per year is a "base salary" provided by the system. The official noted that Shaanxi's electricity spot market will continue continuous settlement trial operations in 2026 (per the "Shaanxi 2026 Electricity Market Trading Implementation Plan"), but peak-valley price spread revenues remain limited, and the ancillary services market is relatively small. Relying solely on capacity pricing is not enough to support healthy profitability for storage projects, and the industry's profit depth still lags behind provinces with more mature spot markets and higher capacity pricing standards.

The 6-Hour Baseline Rule

The aforementioned local Development and Reform Commission official explained that the core of Shaanxi's new capacity pricing rule is a mechanism calculated based on peak shaving capability. The full 165 yuan per kW per year capacity price is not directly accessible to all storage stations; revenue levels are directly tied to the station's full-power discharge duration. The conversion formula is: actual capacity price receivable = 165 yuan per kW per year × (station's full-power continuous discharge duration ÷ longest annual net load peak duration, provisionally 6 hours), with a maximum conversion coefficient of 1.

In other words, only storage projects with a duration of 6 hours or more can receive the full capacity price. The 165 yuan standard equals the coal power capacity pricing standard set in Document No. 114 (coal power's recovery ratio increased to 50% in 2026, corresponding to 165 yuan per kW per year), with storage capacity pricing based on this benchmark and adjusted according to peak shaving capability. The 6-hour baseline duration is derived from empirical analysis of a full year of Shaanxi's grid operation data, corresponding to the period in the annual net load curve when the supply gap is most concentrated—when winter heating, industrial demand, and evening residential electricity use overlap, and solar power rapidly declines toward dusk, releasing concentrated evening peak gaps. Capacity pricing compensates for the reliable capacity that storage genuinely provides for system peak shaving; the policy compensates for the period when the system most needs storage to step up, hence the 6-hour baseline anchor.

Director Wang of the New Energy Division of a northwestern regional Development and Reform Commission analyzed that Shaanxi's implementation also reflects details of industrial cultivation orientation, as well as adjustments to assessment rules. For example, in terms of assessment fault tolerance, Shaanxi provides space for storage stations to debug and integrate with grid dispatch during the cultivation period. The first year of operation typically involves equipment debugging and dispatch coordination, and overly strict assessments could dampen the fledgling independent storage industry. The official stated that capacity pricing is essentially a "guaranteed wage" for the system to secure reliable capacity, with the policy goal of cultivating usable regulation resources rather than penalizing enterprises.

However, the aforementioned Shaanxi local Development and Reform Commission official added that relaxation does not mean leniency—the hard constraint of three deductions within a natural year leading to direct disqualification remains unchanged. He said: "The rules are already published, but all revenue realization depends on an admission list that has yet to be released." According to Economic Observer reporters, the next step is that eligible grid-side independent storage in Shaanxi will be managed under a list system, with the project list pending further refinement. Industry expectations are that projects will be required to have grid-side independent storage attributes, not occupy mandatory storage allocation quotas, possess independent metering and dispatch capabilities, and may be subject to capacity thresholds.

The Enterprise Calculation

From an investment logic perspective, how will this duration-based capacity pricing change project investment? Zhou Shengmin analyzed that with a 6-hour baseline set by the policy, investors might consider whether to retrofit existing 2-hour or 4-hour storage projects to 6 hours to capture the full 165 yuan per kW per year. However, based on calculations using the relevant policy formula, he believes this hypothesis does not hold.

He used an example of an already-operational 100 MW/4-hour grid-side independent storage project in Shaanxi: the conversion coefficient is 4÷6≈0.667, corresponding to a capacity price of 110 yuan per kW per year (165×4/6), and with 100,000 kW of installed capacity, the annual capacity electricity payment would be approximately 11 million yuan. Only projects achieving 6 hours or more can receive the full annual standard of 165 yuan per kW per year. If a neighboring 100 MW/2-hour project were retrofitted to 100 MW/6-hour, the formula suggests an additional 4 hours of battery capacity, i.e., 400 MWh of cells. With current energy storage system integration prices compressed to around 1 yuan per watt-hour (based on a rough estimate of current EPC turnkey prices of about 1 yuan per watt-hour, where EPC refers to "Engineering, Procurement, and Construction" general contracting), the incremental investment would be approximately 400 million yuan.

On the revenue side, the 2-hour project corresponds to capacity electricity payments of 5.5 million yuan per year, while the 6-hour project could receive 16.5 million yuan per year—an increase of only 11 million yuan in annual capacity revenue after retrofitting. He commented: "Hundreds of millions in incremental capital investment, exchanged for an additional 11 million yuan in annual revenue, with a static payback period far exceeding the lithium battery cycle life—this calculation simply doesn't add up." In his view, capacity pricing should be understood more as an incentive for the industry rather than a forced driver. The policy encourages long-duration storage, but it will not drive companies to irrationally revise original plans. Companies will continue to determine discharge duration based on grid needs and project positioning, rather than simply stacking batteries to chase the full capacity price.

Zhao Xiaobing, a Development and Reform Commission official from the Yangtze River Delta region, believes that at Shaanxi's current electricity market stage, independent storage can autonomously participate in either the energy spot market or the frequency regulation ancillary services market (though not simultaneously), with capacity pricing serving as a safety net—together forming the basic revenue structure for projects. However, a practical issue is that Shaanxi's electricity spot market remains in continuous settlement trial operation, with limited price spread revenue potential, and the ancillary services market is relatively small overall.

Zhao stated that in the long run, there will not be a uniform national standard for independent storage capacity pricing across the country. Different regions will develop differentiated baseline durations based on their own net load curves, renewable energy resources, and load scales. In his view, practices in places like Shaanxi will serve as important reference models for other regions in the future. Zhao said: "A capacity price only partially addresses fixed cost coverage; it cannot solve the entire profitability challenge for storage. Capacity pricing supports baseline revenue, while market trading unlocks incremental returns—only through the synergy of both can independent storage achieve a sustainable commercialization path."