Australia’s New 2 GW/4.2 GWh Projects To Result In A 10X Increase In Grid-Forming Storage Capacity In National Electricity Market

The Australian Renewable Energy Agency has announced $176 million in conditional funding for 8 grid-scale battery projects across Australia.

Recent technological advancements and price reductions in the battery storage sector mean that large utility-scale projects are now more viable. We hope to see more GW/GWh scale energy storage projects taking off around the world. In fact, we are starting to see more exciting developments in this space.

A few months ago, ESS, an Oregon-based company that manufactures flow batteries, and the Sacramento Municipal Utility District, announced that ESS would supply SMUD with flow batteries with a total capacity of 200 MW/2 GWh beginning next year. In the UK, Zenobē, the EV fleet and battery storage specialist, also announced that it has started construction on groundbreaking battery storage projects to bring its total storage portfolio in Scotland to 1,050 MW / 2,100 MWh. The projects will add new battery storage capacity that will be more than the total MWh of all grid-connected batteries operating in the UK today.

In South Africa, Eskom has just started construction of an 8 MW/32 MWh project, enough to power a town such as Howick for four hours. Among the notable benefits of the BESS is that it will boost the network during peak hours, thereby reducing the strain on the network during peak hours. This is part of the larger storage roll out by Eskom adding up to 199 MW of additional capacity, with 833 MWh storage of distributed battery storage plants at eight Eskom Distribution substation sites throughout the country.

One of the trendsetters in the “Big Battery” game is Australia. Several years ago, the ‘Big Battery” in Australia, the biggest in the world at that time, was making all the headlines. Australia is going big on these battery projects with several other active projects and another one, the massive 850 MW/1680 MWh project in New South Wales by Akaysha Energy, is in the works.

Now, the Australian Renewable Energy Agency (ARENA) has announced $176 million in conditional funding for eight grid scale battery projects across Australia.

The projects are funded under ARENA’s Large Scale Battery Storage Funding Round. Each battery will be equipped with grid-forming inverter technology, allowing them to provide essential system stability services traditionally provided by synchronous generation such as coal and gas.

With a total project value of $2.7 billion and a capacity of 2.0 GW / 4.2 GWh, these projects represent a tenfold increase in grid-forming electricity storage capacity currently operational in the National Electricity Market.

The developers and projects ARENA has selected for support are:

• • AGL: A new 250 MW / 500 MWh battery in Liddell, NSW
  • FRV: A new 250 MW / 550 MWh battery in Gnarwarre, VIC
  • Neoen: Retrofitting the 300 MW / 450 MWh Victorian Big Battery in Moorabool, VIC to enable grid-forming capability
  • Neoen: A new 200 MW / 400 MWh battery in Hopeland, QLD
  • Neoen: A new 200 MW / 400 MWh battery in Blyth, SA
  • Origin: A new 300 MW / 900 MWh battery in Mortlake, VIC
  • Risen: A new 200 MW / 400 MWh battery in Bungama, SA
  • TagEnergy: A new 300 MW / 600 MWh battery in Mount Fox QLD

The Large Scale Battery Storage Round was launched in December 2021 with an initial funding envelope of $100 million. In recognition of the high quality of applications received, this was expanded to $176 million, including $60 million in additional funding provided to ARENA by the Australian Government in the October 2022 budget as part of its support for energy security and reliability. The 8 successful projects were chosen from a shortlist of 12 projects announced in July. ARENA received 54 expressions of interest for the competitive funding round.

ARENA CEO Darren Miller said the batteries represent a transformative portfolio of new storage capacity.

“These next generation grid scale batteries will underpin this transition, with inverter technology that can maintain grid stability without the need for coal and gas generators. This pipeline of grid-forming projects will help move us closer to an electricity grid that can support 100 per cent renewable energy in the NEM. With the high quality of proposals, we received, ARENA and the Government saw an opportunity to deliver a step change in grid-forming capability across the NEM, which we’ve backed with additional funding.”

All the batteries are expected to reach financial close in 2023 and be operational by 2025.

These projects are pretty exciting. It feels like where we are now with storage is where we were with solar PV around 7 years ago. The storage market could yet grow much faster, driven by the need to help existing variable renewable projects through reducing curtailment along with offering other ancillary services. There will also play a key role in helping to integrate more of the variable renewable projects planned around the world.

Image courtesy of ARENA