ARENA pledges funding support to 4.2GWh of battery storage across Australia

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Eight large-scale battery energy storage system (BESS) projects in various parts of Australia have been selected to receive funding support worth AU$176 million (US$118.07 million).

The Australian Renewable Energy Agency (ARENA) announced last week that the eight projects, which will add up to 2GW/4.2GWh in total, have been chosen from a shortlist of 12, which in turn had been whittled down from 54 expressions of interest received.

The competitive selection process was held as part of ARENA’s Large Scale Battery Storage Funding Round. The government agency had launched the round at the start of this year intending to commit up to AU$100 million funding.

However, ARENA said in a press release that, given the high quality of applications received, it had decided to pledge the extra AU$76 million. AU$60 million of that extra funding will come from money set aside in the federal government’s October budget to enhance energy security and reliability.

The BESS projects must be equipped with advanced inverter technology that makes them so-called “grid-forming” battery assets, capable of delivering inertia as a system stability service. Historically, this crucial aspect of balancing the grid has been delivered from the rotating mass of thermal power generators.

As the transition to renewable energy gathers pace, the Australian government naturally wants to rely less and less on those conventional power assets. ARENA has to date already supported several advanced inverter battery projects – one prominent example is the Tesla-Neoen Hornsdale Power Reserve in South Australia which got an advanced inverter upgrade earlier this year.

In fact, five out of eight BESS projects ARENA has supported with AU$81 million prior to the latest announcement are grid-forming, with the 150MW/194MWh Hornsdale BESS the largest of those so far. As the table below shows, the eight selected projects announced last week are on a much bigger scale.

Aside from the retrofit of advanced inverters at the existing 300MW/450MWh Victorian Big Battery – Australia’s biggest BESS – all of the selected projects will have two-hour storage duration or more.  

As reported by Energy-Storage.news in July, the 12 shortlisted projects represented a total investment value of almost AU$4 billion, and 3,050MW/7,000MWh of output and capacity. According to ARENA, the eight projects selected represent a total project value of AU$2.7 billion.

Projects selected in ARENA funding round:

DeveloperBESS Output/Capacity (MW/MWh)StatusLocationState
AGL250MW/500MWhNew-buildLiddellNSW
Fotowatio Renewable Ventures250MW/550MWhNew-buildGnarwarreVIC
Neoen300MW/450MWhRetrofit MooraboolVIC
Neoen200MW/400MWhNew-buildHopelandQLD
Neoen200MW/400MWhNew-buildBlythSA
Origin Energy 300MW/900MWhNew-buildMortlakeVIC
Risen Energy 200MW/400MWhNew-build BungamaSA
TagEnergy300MW/600MWhNew-buildMount Fox QLD

Energy storage looks set to get policy support on a much grander scale soon, with Australia’s federal energy minister Chris Bowen and state energy ministers making a recent agreement to launch tenders for dispatchable, energy storage-backed renewable energy.

Energy-Storage.news’ publisher Solar Media will host the 1st Energy Storage Summit Asia, 11-12 July 2023 in Singapore. The event will help give clarity on this nascent, yet quickly growing market, bringing together a community of credible independent generators, policymakers, banks, funds, off-takers and technology providers. For more information, go to the website.

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