ERCOT's RTC+B Market Reform: Unlocking Billions in Grid Efficiency for Energy Storage and Clean Energy Buyers

The Electric Reliability Council of Texas (ERCOT) has embarked on a transformative overhaul of its wholesale electricity market with the implementation of the Real-Time Co-optimization Plus Batteries (RTC+B) model. This reform, which went live on December 5, 2025, redefines how energy and ancillary services are dispatched in real time, with profound implications for energy storage operators and clean energy buyers. By integrating battery energy storage systems (BESS) as unified assets and introducing dynamic pricing mechanisms, ERCOT aims to unlock an estimated $2.5–$6.4 billion in annual savings while enhancing grid reliability.

For energy storage operators, the RTC+B model presents a unique opportunity to optimize asset utilization. Traditionally, batteries were constrained by rigid market rules that treated energy and ancillary services as separate commodities. Under RTC+B, however, batteries are modeled as a single device with a state-of-charge, enabling real-time co-optimization of charging and discharging based on market conditions. This shift allows operators to respond dynamically to locational marginal price (LMP) fluctuations, shifting energy from low-LMP to high-LMP periods. Case studies suggest this could reduce total system costs by up to 2.7%. Additionally, the replacement of the outdated Operating Reserve Demand Curve (ORDC) with individual Ancillary Service Demand Curves (ASDCs) ensures more accurate pricing of grid stability services, reducing volatility and creating clearer revenue signals for storage assets.

Clean energy buyers, particularly those with long-term power purchase agreements (PPAs), stand to benefit from the increased efficiency and lower wholesale prices driven by RTC+B. By enabling batteries to arbitrage energy more effectively, the reform reduces the need for costly peaking resources and mitigates the intermittency risks associated with renewables. According to a report by Resurety, the projected $6.4 billion in annual savings could translate to lower energy costs for buyers, especially those in sectors with high renewable exposure. Furthermore, the enhanced grid resilience provided by real-time co-optimization supports the integration of variable renewables, making clean energy procurement more predictable and cost-effective.

Critically, the reform also addresses a long-standing inefficiency in ancillary services markets. Prior to RTC+B, these services were procured in the Day-Ahead Market and remained static in real time, leading to suboptimal resource allocation. The new ASDC framework allows for real-time adjustments, ensuring that the most cost-effective resources-often batteries-are dispatched first. This not only lowers system costs but also creates a level playing field for storage operators, who can now compete more effectively against traditional reserves.

While some battery operators have raised concerns about the state-of-charge rules potentially limiting their participation in ancillary services markets, the broader market dynamics suggest these challenges will be outweighed by the gains in efficiency and scalability. The Independent Market Monitor for ERCOT anticipates that the increased competition and transparency under RTC+B will drive down prices for both energy and ancillary services, amplifying the financial returns for well-positioned storage assets.

In conclusion, ERCOT's RTC+B reform marks a pivotal moment for Texas's energy market. By harmonizing the dispatch of energy and ancillary services and leveraging the flexibility of battery storage, the model not only enhances grid reliability but also creates a financial tailwind for energy storage operators and clean energy buyers. As the market adapts to these changes, investors and procurers who align with the RTC+B framework stand to capture a significant share of the projected $6.4 billion in annual savings-a testament to the power of market design in accelerating the transition to a cleaner, more efficient energy future.