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Australia: Neoen launches phase two build of 2.2GWh Collie BESS following capacity market award

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IPP Neoen has launched construction on the second phase of its Collie BESS project in Western Australia, following the award of a capacity services contract.

The France-headquartered independent power producer (IPP) has given notice to proceed (NTP) to contractors Tesla and UGL, an engineering, procurement and construction (EPC) firm, to start building the 341MW/1,363MWh phase two portion of the project.

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The battery energy storage system (BESS) project is in the South-West Interconnected System (SWIS) grid in Western Australia, and its first phase of construction, totalling 219MW/877MWh, is already underway. That portion is set to come online in Q4 this year, while phase two will be completed in Q4 2025.

Both phases have won separate capacity services contracts with the Australian Energy Market Operator (AEMO). Phase one of the project won a 197MW, 4-hour contract in June 2023, while phase two’s 300MW, 4-hour win was the prompt for giving Tesla and UGL notice to proceed, announced today (29 April).

Specifically, they will provide four hours of discharging capacity across the evening peak via AEMO Non-Co-optimised Essential System Services (NCESS) contract starting 1 October, 2025. The service addresses the risks relating to the retirement of coal power plants, the proliferation of rooftop solar and increasing demand in the state.

The Collie BESS project, near the town of Collie, is on the land of the indigenous Wilman people of the Bibbulmun nation. It will connect to a new substation from transmission system operator (TSO) Western Power.

Neoen said that once both phases of construction are complete, the Collie BESS will be able to cover 20% of the average demand on the SWIS grid. The two phases together total 560MW/2,240MWh of BESS capacity, making it among the largest projects in the world. It utilises Tesla’s Megapack 2 XL, its latest grid-scale BESS product.

It brings Neoen’s total portfolio of clean energy under operation or construction in Australia to 4GW, of which 1.7GW is BESS, 1.3GW is solar, and 1.1GW is wind.

It has also enlisted Tesla and UGL for its 200MW/400MWh Western Downs Battery project in Queensland, which will come online later this year, while it handed the supply contract for the identically-sized Blythe BESS in South Australia to BESS and EPC duo NHOA and Elecnor.

Operational assets include the 300MW/450MWh Victorian Big Battery and the 150MW/193.5MWh Hornsdale Power Reserve in Victoria and South Australia, respectively.

Australia is one of the most active energy storage markets globally with some 2.5GWh coming online last year across all segments, with projects over 10MWh accounting for just over half of that. The country is launching a new Capacity Investment Scheme which will further boost grid-scale deployments via financially supporting 9GW of dispatchable renewable generation.

Energy-Storage.news’ publisher Solar Media will host the 1st Energy Storage Summit Australia, on 21-22 May 2024 in Sydney, NSW. Featuring a packed programme of panels, presentations and fireside chats from industry leaders focusing on accelerating the market for energy storage across the country. For more information, go to the website.

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