ARENA to fund eight grid-scale batteries

Australian Renewable Energy Agency (ARENA)

Monday, 19 December, 2022

ARENA to fund eight grid-scale batteries

The Australian Renewable Energy Agency (ARENA) has announced $176 million in conditional funding to eight grid-scale battery projects across Australia, on behalf of the Australian Government.

Under ARENA’s Large Scale Battery Storage Funding Round, each battery will include grid-forming inverter technology, allowing them to provide system stability services traditionally provided by synchronous generation such as coal and gas.

These projects are worth $2.7bn and have a capacity of 2.0 GW/4.2 GWh. They will see a tenfold increase in grid-forming electricity storage capacity across the National Electricity Market.

The developers and projects ARENA has selected are:

  • AGL: a 250 MW/500 MWh battery in Liddell, NSW.
  • FRV: a 250 MW/550 MWh battery in Gnarwarre, Vic.
  • Neoen: retrofitting the 300 MW/450 MWh Victorian Big Battery in Moorabool, Vic, to enable grid-forming capability.
  • Neoen: a 200 MW/400 MWh battery in Hopeland, Qld.
  • Neoen: a 200 MW/400 MWh battery in Blyth, SA.
  • Origin: a 300 MW/900 MWh battery in Mortlake, Vic.
  • Risen: a 200 MW/400 MWh battery in Bungama, SA.
  • TagEnergy: a 300 MW/600 MWh battery in Mount Fox Qld.

Launched in December 2021, the Large Scale Battery Storage Round had an initial funding envelope of $100m. This was expanded to $176m, including $60m in additional funding provided by the Australian Government as part of its Support for Energy Security and Reliability budget measure in October 2022.

The eight projects were chosen from a shortlist of 12 projects announced in July. These were selected out of 54 expressions of interest for the competitive funding round.

ARENA CEO Darren Miller said that battery storage is essential in the transition to renewable energy, and these batteries represent a transformative portfolio of new storage capacity. According to him, battery storage technology will allow for variable generation to be smoothed out, as well as electricity to be stored for when it is needed.

“These next-generation grid-scale batteries will underpin this transition, with inverter technology that can maintain grid stability without the need for coal and gas generators. This pipeline of grid-forming projects will help move us closer to an electricity grid that can support 100% renewable energy in the NEM,” Miller said.

ARENA had previously provided $81m in funding for eight grid-scale batteries, including five with a smaller scale of grid-forming capability. The largest current grid-forming battery in Australia is the 150 MW/194 MWh Hornsdale Power Reserve in South Australia, which received ARENA funding for its 2019 expansion.

The potential of grid-forming batteries has been highlighted by the previous projects, as well as the need to support further projects at a larger scale, de-risk investment and drive further innovation from inverter manufacturers. The funding may also assist in overcoming current commercial and regulatory barriers to large-scale deployment.

The batteries are expected to reach financial close in 2023 and be operational by 2025.

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