Neoen Doubles Australian Battery Size, Citing ‘Market Opportunities’

Neoen Doubles Australian Battery Size, Citing ‘Market Opportunities’

French developer Neoen, the firm behind the original ‘big battery’ at Hornsdale Power reserve where is used Tesla batteries, has just expanded its bet on Australia. The firm has announced the doubling of its newest big battery production to 100MW/200MWh in the Australian Capital Territory (ACT). Neoen has emerged as a major storage player on the back of its Australian projects, where it has been behind the largest batteries on the continent.

The Capital Battery takes Neoen’s Australian battery storage portfolio to 576 MW in operation or under construction, cementing its position as the country’s leading owner and operator of big batteries. Neoen also owns and operates the recently completed 300 MW / 450 MWh Victorian Big Battery in Geelong, and the 150 MW / 193.5 MWh Hornsdale Power Reserve in South Australia. The project takes Neoen one step closer to its goal of having at least one large-scale battery operating in each state of Australia’s National Electricity Market.

Just last week, Neoen had inaugurated the 300MW/450MWh Victorian Big Battery, which took over the mantle of the largest battery in Australia. Big storage batteries have found fertile ground in Australia, as the share of renewables in the grid goes up, and stability and back up becomes a key objective too.

For its newest battery build, Neoen has dropped Tesla in favour of Korean major Doosan. In line with Neoen’s develop-to-own business model, the company will be the long-term owner and operator of the project and once operational will launch a Community Co-investment Scheme, providing residents of the ACT and Capital region with an opportunity to become financial stakeholders in the project.

Under the original bid terms, Neoen had won a tender to build a 50 MW large scale battery in ACT Government’s 2020 renewable energy auction, which came with a 14-year contract to supply 100 MW of wind energy from Stage 1 of Goyder Renewables Zone.

While the original Hornsdale battery was designed to provide power back up for a maximum of 30 minutes to 3 hours depending on draw rate, the new battery is rated to work for at least 2 hours. The key objective for Hornsdale  was frequency control for the grid operator, needed for very short periods.

A longer backup period will create opportunities in energy arbitrage, or helping prevent power curtailment from wind energy possible, by shifting output to different periods. The battery storage industry in general is expected to move to longer hours of storage as more opportunities  emerge in time shifting renewables, but this depends on market volatility (buying, or charging, at low prices and selling, or discharging, at higher prices).

It also reflects the fact that some of the battery capacity can be reserved for grid services, and the rest can focus on arbitrage.

The Hornsdale battery delivered super normal profits for instance in 2020 when a key interconnector failed for 18 days, enabling the battery to provide longer stability services and prevent wind curtailment.

The ACT has reached its target of net 100 per cent renewables, and is adding more renewable energy and storage to decarbonise other sectors such as transport and buildings.

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Prasanna Singh

Prasanna has been a media professional for over 20 years. He is the Group Editor of Saur Energy International