“This is a humongous battery’.
So declared Victorian Minister for Energy, Environment and Climate Change Lily D’Ambrosio during an online panel discussion moderated by Renew Economy Founder and Managing Editor Giles Parkinson on November 5.
D’Ambrosio was referring the Victorian Big Battery – a 300 MW Tesla battery which when complete and installed by the summer of 2021/22 will be the biggest battery in the Southern Hemisphere and the second largest in the world.
In a joint statement published earlier that day, the Victorian Government, renewable energy power provider Neoen and electric vehicle and clean energy storage product supplier Tesla announced the battery’s construction.
During the discussion, D’Ambrosio, Neoen Australia Managing Director Louis De Sambucy and Tesla Chairperson Robyn Denholm talked about the battery’s design, the role of large-scale batteries as an enabler of renewable energy and the benefits which the battery will deliver for Victoria.
The battery be installed at the Moorabool Terminal Station just outside Geelong and around 80 kilometres south-west of Melbourne.
It will be constructed, operated and maintained by Neoen at the company’s own cost.
Consumers will then pay for the battery’s use through their power bills.
The battery will support Victoria’s push for 50 percent renewable energy by 2030.
It will store surplus energy generated when wind and solar conditions are favourable and will discharge this back into the grid when energy is needed.
The battery will also provide additional stability to the grid during the peak summer period.
Under an eleven-year contract which Neoen was awarded with the Australian Energy Market Operator, a portion of the battery’s capacity will be reserved to increase the power which flows through the Victoria-New South Wales Interconnector by up to 250 MW during the warmer months from November until March each year until 2032.
During these months, the battery will provide an automatic response in the event of an unexpected network outage.
The awarding of that contract – worth $84 million over eleven years – occurred after a procurement process which was initiated by the Victorian Government.
D’Ambrosio said several factors lie behind Victoria’s push into battery storage.
As the state moves its energy system away from carbon intensive generation sources such as thermal coal toward low-carbon sources such as renewables, large-scale storage technologies are needed to ensure a smooth and reliable transition.
The back-up delivered by the new battery will also provide stability as Victoria’s aging coal-fired power plants become increasingly susceptible to failure as a changing climate delivers more extreme summer weather.
Moreover, the new battery will signal to industry generally and renewable energy providers specifically that the Government has a plan to both manage a smooth energy transition and to enable higher volumes of renewable energy to be delivered into the system.
D’Ambrosio says the importance of battery storage should not be underestimated.
“We know that our strong and ambitious renewable energy targets – our commitment to (addressing) climate change and doing tangible real things is a very strong story to be told, she said, referring to Victoria’s renewable target.
“But we also need to ensure that we have the complementary supporting technologies in place so that as we transition toward a decarbonised energy system, we do so in a way that ensures that we keep our energy security, reliability and affordability as the key focus of what we are doing.”
According to Neoen’s De Sambucy, the battery will operate in a similar way to a 100MW battery which the company currently operates at the Hornsdale Power Reserve in South Australia (currently being expanded to 150MW).
The main difference, however, is that the new battery will be three times larger.
This is noteworthy as the Hornsdale battery was the largest battery in the world when it was constructed three years ago in 2017.
The location, also, was strategically chosen. At Moorabool, the battery will be next to transmission lines running north and west along with the interconnector running between Victoria and New South Wales. There are also significant wind resources in the west and solar farms to the north.
De Sambucy would not be drawn on the battery’s cost but noted that battery prices are on a downward trajectory.
For Tesla, meanwhile, Denholm says the Victoria Big Battery represents an opportunity to prove at scale a new type of battery for large-scale utility projects which it launched last year known as the Megapack.
According to Tesla, the new type of battery builds on engineering from the PowerPack battery installed at Hornsdale but delivers greater energy density and can store similar volumes of energy to traditional batteries whilst using 40 percent less space. The new battery also requires fewer parts and can be installed more quickly compared with current systems.
Whilst Tesla is often associated with cars, it’s founder Elon Musk predicted earlier this year that the company’s energy division would one day match its automotive division in size.
Denholm said the company’s mission was to transform the world to sustainable energy. To do that, batteries are important not only to electrify transportation but also as an enabler of renewable energy.
Asked about concerns that faster renewable take-up could lead to coal generators being pushed out of the grid prematurely, D’Ambrosio acknowledged that this is a legitimate question.
She added, however, that the government needed to ensure sufficient capacity of the system irrespective of any decisions made by private owners of coal plants.
“There are often conversations about how much renewable energy the system can take before it upsets a number of other components of the existing system,” she said.
“I’m not here to make any predictions on that.
“However, what I am here to say for every Victorian business and household is that we need to have a plan. We cannot afford to be cut short of decisions which may be made on the other side of the world about the life that might remain in any of our generators.
“Even though we may not own these assets anymore, people still look to governments to manage the system and to ensure that … we are not left short with decisions that may be made by businesses in terms of what the life of existing generators might be.”