Australia’s solar curtailment crisis and frequent negative pricing events are fundamentally changing how developers approach renewable energy projects, with co-located battery storage shifting from an optional add-on to essential infrastructure
“As we see more and more solar PV plants be deployed, as we see curtailment issues, as we see decommissioning of coal plants in favour of these systems, it’s becoming clear that you need to be co-located with battery storage to maximise the potential of your system and to support the market demands,” says Neha Sinha, product manager for energy storage systems at Wärtsilä Energy Storage & Optimisation.
This perspective reflects the company’s experience scaling from pilot-scale DC-coupled projects to delivering Australia’s largest DC-coupled hybrid system, driven by the technology’s efficiency advantages and the growing need to address solar curtailment and negative pricing in the Australian market.
Sinha explains that the primary benefit of DC-coupled battery energy storage systems (BESS) lies in their round-trip efficiency advantage. “The efficiency losses that come with converting from the solar field through an inverter to the batteries back through an inverter are reduced if you can directly couple the solar to the battery storage,” she says in an interview with ESN Premium.
Enjoy 12 months of exclusive analysis
- Regular insight and analysis of the industry’s biggest developments
- In-depth interviews with the industry’s leading figures
- Annual digital subscription to the PV Tech Power journal
- Discounts on Solar Media’s portfolio of events, in-person and virtual
Or continue reading this article for free
The company’s rapid scaling from its first DC-coupled project with Octopus Australia via the 128MWh Fulham Solar Battery Hybrid project to utility-scale deployments reflects broader market dynamics in Australia’s renewable energy sector.
Co-locating solar and storage provides benefits that extend beyond technical efficiency, allowing operators to target solar curtailment more effectively and capitalise on negative pricing scenarios that have become common in the Australian market.
“There are a lot of solar plants that are not co-located with storage, and don’t have anything that they can do with the excess solar that they’re producing at those negative prices,” Sinha notes.
“Batteries allow you to capture better the energy that you’re producing with solar, and potentially cash into their revenue model associated with negative pricing.”
With the rollout of solar PV across Australia, curtailment has become a prominent issue for the industry. Recent research conducted by the Australian Energy Market Operator (AEMO) revealed that several utility-scale solar PV power plants experienced curtailment of above 25% across the National Electricity Market (NEM) last year.
Meanwhile, negative pricing was discussed at the Energy Storage Summit Australia 2025 in Sydney earlier this year. Tim Buckley, founder and director of the think tank Climate Energy Finance, said that Australia has “world-leading negative pricing in wholesale markets,” noting that in the states of Victoria and South Australia, negative pricing was experienced for 24% and 26% of last year, roughly four times higher than experienced in European power markets.
Why converters are critical to DC-coupled solar-battery hybrids
The technology’s evolution has been supported by concurrent developments in related components. DC-to-DC converters, which were once a significant cost and complexity challenge, have evolved in tandem with the scaling of battery technology and the reduction in lithium-ion costs.
These converters serve a critical function in managing voltage differences between solar arrays and battery systems through buck-boost capability.
“The biggest functionality of it is the voltage metering,” Sinha explains regarding DC-to-DC converters.
“The reason that you need it is because you have the voltage differences between your solar and your battery, and so you need this kind of buck-boost capability to be able to manage the differences between the two units.”
Wärtsilä leverages partnerships with technology providers who have field experience in other markets, particularly in California, where DC-coupled solar projects have been deployed.
Sinha explains that this approach enables the company to leverage proven technology solutions in the Australian market while mitigating the complexity of integrating DC-to-DC converters into an already complex value chain.
The interaction between DC-coupled hybrid systems and the NEM is no different from that of standalone battery or AC-coupled configurations, as the inverter continues to serve as the interface between the battery system and the grid.
Instead, the advantage of DC coupling manifests in the coordination between solar and battery energy storage components rather than in grid interaction protocols.
“You don’t see a different interaction with the grid, because you still have the inverter standing between your battery system and the grid,” Sinha says.
“The benefit that you’re seeing is when it comes to the brains between the solar and the battery field, and that has a lot less to do with the energy market itself, and it has a lot more to do with your technology system.”
The management of DC-coupled plants requires sophisticated control systems that can recognise solar performance and coordinate with battery operations while responding to market expectations and demands.
This coordination extends beyond the technology itself to encompass trading desk operations and the management of both solar generation and battery capacity.
Australia’s position as a testing ground for advanced energy storage technologies extends beyond DC coupling to grid-forming battery storage, where the country is among the early global leaders in development.
Sinha notes that while DC-coupling has reference points in other markets, such as California, grid-forming technology represents an area where Australia pioneers solutions that other markets will examine for evidence of successful implementation.
Opportunities for DC-coupling in Western Australia
The company is monitoring opportunities in Western Australia, where DC-coupled projects have been deployed in that state’s Wholesale Electricity Market (WEM), the country’s biggest power market outside the NEM.
As interest in the technology grows, organisations with successful deployment experience become reference points for new market development.
The technology requires early commitment during project development, but the increasing clarity around the need for co-located storage makes this decision more straightforward for developers.
DC coupling provides an alternative path to traditional AC coupling that is “incredibly efficient and streamlined from the very beginning of your deployment,” according to Sinha.
“More and more people know from the very beginning of their projects that they’re absolutely not going just to need storage or solar, but they will need storage,” she says.
The key metric for evaluating storage projects, according to Sinha, should be usable energy and the total energy output that can be achieved from the system. This encompasses battery capacity, system efficiencies, and control capacity to maximise system availability.
In DC-coupled solutions where improved efficiency is a primary advantage, this focus on usable energy becomes particularly relevant for supporting solar integration goals and maintaining grid reliability and capacity.
Each BESS deployment serves as a case study for new market opportunities, with successful projects providing templates for broader technology adoption as Australia’s renewable energy transition continues and coal-fired power plants are decommissioned in favour of renewable energy systems with integrated storage.