Neoen Australia chief executive Louis De Sambucy says utility-scale batteries will be the “game changer” to help Australia move towards net zero by 2050.
The owner of the Hornsdale battery project in South Australia as well as the Victorian Big Battery near Ballarat – with three other projects in the pipeline in Queensland, the ACT and NSW – said battery prices were falling so rapidly consumers were voting with their feet.
“Current battery prices are already low enough to make sense from a consumer perspective,” he said.
Energy storage – which can take the form of utility-scale batteries or older technology such as pumped hydro – is one of the six technologies highlighted by the Morrison government to reach net zero by the middle of the century.
Mr De Sambucy said utility-scale batteries were a perfect fit for Australia’s decentralised power grid.
“Australia is unique. We have a very large electricity network that has been finely tuned to supply small regional cities that are hundreds of kilometres apart,” he said.
“The flexibility and support functions of utility-scale batteries are a game changer for Australia and its unique grid.
“Batteries like the Victorian Big Battery are unlocking capacity for new industrial energy users and new renewable energy generation plants to connect. They are also facilitating better inter-regional flow from the existing poles and wires which makes electricity cheaper for everyone.”
For some clean energy advocates, energy storage is the “final piece of the jigsaw puzzle” in Australia’s transition to a low-emissions economy.
While there has been a surge in renewable energy projects. The move to net zero emissions by 2050 will be dependent on finding proper storage for wind and solar power to provide dispatchable generation for the grid.
“Energy storage technologies are essential for Australia to shift to lower emissions electricity systems,” the net zero 2050 plan released by the government said.
“Capturing the full potential of Australia’s renewable energy resources requires storage that can dispatch clean electricity on demand and provide critical system security services.”
The unlocking of low-cost storage could also unlock new energy intensive exports, the plan found.
The federal government’s net zero plan said the most pressing need for storage is durations of several hours to manage daily variations in solar and wind output.
“But longer duration ‘deep storage’ technologies, along with expanded transmission networks, will also be needed as very high shares of renewables enter Australia’s electricity grid,” it said.
Clean Energy Council chief executive Kane Thornton said there had been a $20 billion surge in private investment for renewable energy which had driven generation from clean energy to 30 per cent.
The Australian Energy Market Operator said there were five grid-scale batteries with a capacity of 260 megawatts operating in South Australia and Victoria.
This includes the 150 megawatt Hornsdale battery in South Australia – which emerged after Atlassian co-founder Mike Cannon-Brookes made a bet with Tesla chief executive Elon Musk to deliver a battery after a state-wide blackout in 2017.
The Victorian Big Battery, near Geelong, which raised headlines in July after it caught fire, is in pre-testing before it joins the grid.
In addition, there are more than 85 big batteries with a total capacity of 18,660 MW in the planning pipeline.
Planning is currently underway for the world’s biggest grid-scale battery in the Hunter Valley, New South Wales.
According to developer CEP Energy, the $2.4bn battery at Kurri Kurri, north-west of Newcastle, would have a power capacity of up to 1,200 MW – about eight times greater than the battery at Hornsdale.
Lumea chief executive Richard Lowe – who has just installed the company’s first battery into the grid in western Sydney and has a second larger project in Melbourne due to reach financial close next year – said he expected a proliferation of grid-scale storage projects over the next few years.
The $300 million project at Deer Park in Melbourne is also significant because it will be the first utility-scale battery project in Australia without any government subsidy.
“We’re at the crossroad. It’s an inflection point, if we can get to adoption of that technology without government support or contracts – and we expect that it will get to that point with this project,” Mr Lowe told The Australian Financial Review Infrastructure Summit last week.
“And that will then see a proliferation of similar projects across the national electricity market through next year and in the years beyond.”
Pumped hydro technology – which uses water stored in one reservoir released to a lower reservoir to create electricity – has been around for more than a century, but is now championed as a “virtual battery”.
Snowy Hydro 2.0 and Genex Power’s $777 million Kidston project are two high-profile pumped hydro projects on the radar.
The Kidston project, using an abandoned gold mine in North Queensland, has received significant government funding on its way to financial close.
In the Kidston project, the electricity generated from its 50 megawatt solar farm – along with power from the grid – will pump water from a lower reservoir to an upper reservoir.
During morning and evening peaks, the water will be released from the upper reservoir – which has been likened to a giant battery – to the lower reservoir to generate dispatchable electricity.
Other companies have been exploring using pumped hydro projects to store energy, but they are reliant on finding the right topography rather than utility-scale batteries that can be used anywhere.