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Australia’s national CEFC invests AU$100 million in coal-replacement NSW ‘Super Battery’

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Australia’s government has made a AU$100 million (US$66.35 million) investment into the Waratah Super Battery, part of a total AU$500 million capital raise by the project’s developer.

The flagship battery energy storage system (BESS) project in New South Wales (NSW) is aimed at helping ease demands on the grid as Eraring, a 2,880MW coal power plant in the state is decommissioned in 2025. In addition to Eraring, three more of NSW’s five coal power plants are due for retirement within the next 11 years.

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The project given Critical State Significant Infrastructure status to be fast-tracked by the NSW government and was put out to tender. State-owned corporation EnergyCo NSW awarded a 700MW/1400MWh System Integrity Protection Scheme (SIPS) contract to developer Akaysha Power, which is owned by global asset manager Blackrock, last October. Planning approval from the state government then came in February this year.

The SIPS is intended to safeguard the electricity network from causes of unexpected outages, which can include extreme weather events. The Waratah Super Battery has been described as a “giant shock absorber” for the grid, and other large-scale battery storage systems around Australia, such as the 300MW/450MWh Victorian Big Battery, already have similar contracts in place.  

According to a release sent from Blackrock to media including Energy-Storage.news this morning, institutional and sovereign co-investors from both Australia and abroad have backed it with the AU$500 million of capital commitments.  

The Clean Energy Finance Corporation (CEFC), the Australian Commonwealth government’s arm for investing into clean energy technologies and projects, will back the project, shortly after the government committed to continuing to fund the corporation.

The country’s Minister for Energy and Climate Change Chris Bowen said the battery project “will help stabilise the electricity network and help deliver more of the cleanest, cheapest form of energy for Australian businesses and households”.

Bowen noted the CEFC’s support has already been committed to large-scale BESS projects in four Australian states, while its recent refinancing confirmed a near-AU$20 billion investment into Rewiring the Nation, a scheme to upgrade and expand transmission networks.

Rewiring the Nation will also directly enable the Battery of the Nation project in Tasmania, which will see the island state become an exporter of renewable energy into the National Electricity Market (NEM) using battery storage, pumped hydro energy storage (PHES) – and of course renewable energy generation.  

Also highly anticipated is the forthcoming Capacity Investment Mechanism, a countrywide scheme to tender for firm, dispatchable renewable energy capacity. Energy storage is so central to that scheme that Bowen has previously called it analogous to a national energy storage strategy of the type clean energy industry and advocates had asked the government, in power since mid-2022, to enact.

Construction on project began in May

The Waratah Super Battery will have total output and capacity of 850MW/1680MWh, according to Blackrock, potentially leaving capacity available for participation in merchant revenue opportunities, as long as 700MW/1400MWh is available to EnergyCo NSW under its Energy Service Provider contract with Akaysha Power.

EnergyCo NSW has announced that construction on the project began in May, with it scheduled to come online ahead of Eraring’s 2025 retirement date. It is actually being built on the site of another NSW coal-fired power plant, Munmorah, which is already decommissioned.

Akaysha Power appointed US system integrator and manufacturer Powin Energy to work on the project in late 2022, shortly after the pair announced a multi-year BESS supply partnership that signaled Oregon-headquartered Powin’s first entry into the Australian market. Powin has since appointed its own key contractors and partners, including South Korean contract manufacturer ACE Engineering.

Eraring site to host flow battery pilot

In related news, the Eraring coal plant site looks set to host a pilot of a novel Australian-developed flow battery technology.

Publicly-listed energy generator and retailer Origin Energy, which owns the power plant, has invested in Allegro Energy, a startup which has developed a novel redox flow battery (RFB) using a water-based electrolyte.

Origin said yesterday that it invested an undisclosed sum to take a 5% stake in the tech company, which is also developing ultracapacitors for stationary storage applications. An initial pilot deployment of a 100kW, 8-hour duration (800kWh) RFB, could be followed up with a 5MW/60MWh system if successful.

Origin is already developing its own large-scale lithium-ion BESS installation at Eraring too, having said it will invest AU$600 million into a 460MW/920MWh system at the site, on which works are expected to commence in July. Origin Energy brought the closure of Eraring forward to 2025 from 2032, citing economic pressures as coal struggles to compete with solar and energy storage in the NEM.

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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