Korea's largest storage tender to date fixes unindexed 15-year prices
On 22 September 2026 the Korea Power Exchange (KPX) opened its 2026 central contract tender for six-hour storage: 1,100 MW / 6,600 MWh on the mainland and 80 MW / 480 MWh in Jeju, for completion by February 2029. Mainland winners are paid their bid price, fixed for 15 years; Jeju bidders choose between 15 years at 60% of the bid price plus trading revenue, or 25 years at the full bid price. Bid proposals are due by 18:00 on 4 November 2026.
Our take
What does Korea's 2026 central contract tender offer private battery storage investors?
Korea's 2026 central contract tender offers mainland storage an unindexed 15-year payment that rewards the cheapest capital, while its Jeju 15-year option is the first, narrow opening for storage that earns from trading.
Mainland plants earn no trading revenue and are dispatched by KPX, so the unindexed bid price sets the return. In Jeju, the 75% clawback on trading revenue between one and three times the expected level limits what trading skill can add.
What the source says
- Mainland: the bid price, a unit fixed cost per kW of available capacity covering investment and operating costs, becomes the contract price for 15 years from commercial operation, with no inflation indexation. Charging costs and discharge revenue are not settled, so the plant earns no wholesale revenue; it is paid monthly as contract price × available capacity (storage ÷ 6) × a compliance rate that falls when dispatch instructions are not met.
- Mainland plants must be rated for at least 383 cycles a year (5,745 over 15 years), and keep at least 70% of initial capacity at the end of the contract and 65% round-trip efficiency including auxiliary load.
- The contract price is revised downwards during the contract if the equity ratio falls below 15%, if warranted capacity or efficiency falls below the values scored at bid, or if the credit rating falls on a transfer.
- Jeju offers two terms that compete in one ranking: 15 years at 60% of the bid price, which can be reduced by outages, price adjustments and delay penalties, with trading allowed and monthly trading revenue settled in three bands against an expected value of 40% of the bid price (paid at 100% up to that value, 25% between one and three times it, and 100% above), requiring 395 cycles a year; or 25 years at the full bid price with no trading, requiring 730 cycles a year.
- Mainland sites must connect to substations or switching stations listed as grid-constrained at the time of the notice, or to other listed substations where storage is expected to relieve the grid; substations under or planned for construction or expansion are excluded from evaluation.
- Bids are sized above 10 MW and below 100 MW on the mainland, and above 10 MW up to 40 MW in Jeju, in 1 MW (6 MWh) steps.
- Price and non-price factors weigh 50:50. Non-price criteria include grid contribution, fire and equipment safety, and contribution to Korea's storage industry and economy, including the origin of key components; a bid scoring below 40% on any of these is excluded. Bids above a price cap are disqualified; the cap is not disclosed and is set on a standard levelised cost of storage.
- If eligible bids fall below 1.15 times the tendered volume, the volume awarded may be cut so that eligible bids are 1.15 times it.
- A preferred bidder that cannot obtain a generation permit loses its status, and a winner without a permit within nine months of the award has the award cancelled; the volume may roll over to a later tender.
- Grid-forming inverters are required under the market operation rules (Appendix 3) and KEPCO's connection standards; lithium-ion batteries and power conversion systems (PCS) need KC certification (KC 62619, KC 62477-1), or KS C IEC 62932 for flow batteries.
- After the contract ends, no further contract or capacity payment is made; if a plant is then decommissioned, its batteries must be disposed of in Korea under a separate contract signed a year before the end.
- Proposals are due by 4 November 2026, with data sheets and business plans by 10 November and the tender closing at 15:00 on 11 November; preferred bidders and winners are to be named in November, and contracts are signed once winners obtain generation permits.
- Korea Power Exchange KPX's briefing material (30 September 2026) says the 25-year Jeju contract was created to bring in multi-cycle, long-life storage that charges at night, when wind curtailment rises (especially when the HVDC link is down), at two cycles a day; it describes the 15-year option as compensating net investment cost with trading allowed, and the 25-year option as compensating total investment cost.
For investors — Contracted storage investors should price inflation and degradation into the mainland bid from the outset, and treat the nine-month permit deadline as the main risk, since a winner without a generation permit loses its award.
Merchant storage investors and optimisers should price their own Jeju trading forecast into the 15-year bid, because the fixed payment is only 60% of the bid price and the clawback limits moderate upside.
Watch: Bid proposals are due on 4 November 2026 and the tender closes on 11 November, with preferred bidders and winners due later that month. After that: how many winners obtain permits within nine months, and whether any Jeju winner takes the 25-year option.
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