Australian AI infrastructure developer Firmus Technologies has signed a 12-year wholesale energy supply agreement with Gunvor Group, including 1.5GWh of battery storage by 2032.
The deal covers 600MW of firm electricity for its planned South Australian “AI Factory” campuses, linked to the development of 1.2GW of new renewable energy generation and 1.5GWh of battery storage.
Firmus describes itself as vertically integrated from model to grid, combining proprietary energy and cooling technology with AI cloud services. The company is registered in Sydney and provides AI cloud services across the Asia Pacific region.
The agreement underpins the first phase of Project Southgate, Firmus’ programme to develop large-scale AI Factory campuses in regional South Australia at Tailem Bend and Stirling North. Together, the two sites represent 2.7GW of planned capacity.
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Under the commercial structure, Gunvor will support the development of generation and storage assets required to supply Firmus’ load, with the battery storage component providing firming capacity to make the renewable energy supply dispatchable.
The deal includes a long-term offtake agreement for GreenPoint Energy’s Koolunga battery energy storage system (BESS), a 200MW/800MWh grid-forming system near Brinkworth in South Australia’s Mid North.
Firmus describes Koolunga as representing more than half of its initial firming capacity commitment, making the battery storage system a central rather than supplementary element of the energy supply architecture.
The grid-forming specification indicates that the Koolunga BESS will provide synthetic inertia and fast frequency response, alongside energy arbitrage, contributing to system stability in a region that already hosts some of the highest renewable energy penetration in any connected grid globally.
The agreement also contains a demand response commitment under which Firmus will reduce its electricity consumption for up to 220 hours per year when wholesale prices exceed agreed thresholds.
Firmus framed this as a deliberate concession to reduce pressure on wholesale prices during periods of grid stress, effectively treating its load as a grid asset rather than a pure consumer.
Firmus Co-CEO Oliver Curtis said the South Australian locations reflect both energy fundamentals and a strategic commitment.
“We’re building our AI Factories in regional South Australia because they’re the right locations for large-scale AI infrastructure and the energy investment that goes with it. Our South Australia energy agreement puts our commitments into practice, backing new renewable energy generation, major battery storage and flexible energy use that supports the grid,” Curtis said.
South Australian Premier Peter Malinauskas welcomed the announcement, describing it as evidence that the state’s clean energy transition is attracting industrial investment.
“South Australia is leading the clean energy transition, and this project demonstrates how that leadership is attracting the industries of the future,” Malinauskas said.
A new model for AI data centre energy procurement
The Firmus-Gunvor structure represents a departure from how most large energy users have historically procured electricity in Australia, where corporate power purchase agreements (PPAs) typically cover a single generation asset and leave firming to the market.
By bundling 1.2GW of new renewable energy generation and 1.5GWh of battery storage into a single 12-year agreement with a commodities trader acting as the intermediary, Firmus effectively outsources the complexity of building a firmed renewables portfolio to a counterparty with the trading and origination capabilities to coordinate multiple assets and risk instruments.
The role of battery storage in meeting the specific power-quality demands of AI compute infrastructure has been documented in detail. Wärtsilä’s analysis of AI data centre power requirements found that the rapid, unpredictable GPU load fluctuations characteristic of large-scale inference and training workloads create grid variability that diesel generators cannot manage, and that utility connections alone cannot absorb without destabilising local networks.
Battery storage positioned between the grid and the data centre load provides the millisecond-level response required to smooth those fluctuations.
The Australian government’s National Data Centre Expectations, published in March 2026, require new data centres to invest in new renewable energy generation concurrently with construction rather than drawing on existing grid capacity.
The Firmus agreement addresses this requirement directly, tying the construction of the AI Factory campuses to the development of 1.2GW of new generation and 1.5GWh of new storage that would not otherwise exist.
Fluence recently discussed how Australia’s data centre boom can be turned into a grid growth story if projects are structured to add net new renewable energy generation on Energy-Storage.news.
Beyond the energy supply structure, data centres integrating battery storage at scale face an evolving regulatory environment regarding safety.
Fire and Rescue NSW (FRNSW) recently published a position statement mandating 240-minute fire-rated construction for lithium-ion battery rooms in data centres, citing the unknown fire behaviour of battery systems installed within enclosed compartments as a material risk factor.
Firmus’s Tailem Bend and Stirling North sites are in South Australia rather than New South Wales, and, of course, will not be co-located, but the FRNSW position statement reflects a national conversation about how to manage the intersection of large battery storage and critical data centre infrastructure.
Our publisher, Solar Media (part of Informa Group), will host the Battery Asset Management Summit Australia 2026 on 25-26 August at Amora Hotel Jamison in Sydney. You can find out more about the Summit on the official website.
