For a potential investor in battery storage technology, Brattle experts analyzed PJM’s real-time market participation rules for storage. We developed a real-time energy and ancillary service bidding strategy that the asset owner could employ to nearly optimize storage operations, given expectations for prices and battery operations and constraints looking forward several hours. Our analysis estimates the net revenues that storage devices of various efficiencies and durations could earn by employing optimal bidding strategies. We also identified changes in PJM’s real-time bid/offer rules that PJM would have to implement to fully enable optimal battery utilization from a system-wide perspective. Finally, we estimated the revenues that storage devices of different configurations could earn in PJM’s capacity market, assessed the risk of performance penalties, and identified capacity market design modification that would be necessary to access the capacity value of storage resources.