Construction on the second stage of a huge battery project in Australia is set to commence within weeks.

In its latest announcement, French renewable energy provider Neoen says that it has provided notices to battery storage supplier Tesla and construction contractor UGL to commence construction on the 270 MW/540MWh second stage of its Western Downs Battery.

The announcement follows the signing of a 10-year agreement with energy provider AGL for Neoen to provide virtual battery services to the retailer.

Construction is now expected to commence in coming weeks.

Set to commence operation in 2026, the new battery is part of the Western Downs Green Power Hub.

Located near Chinchilla in the Western Downs region of Queensland (about 300km northeast of Brisbane), the hub aims to deliver a reliable source of clean energy for the state.

When complete, the power hub will consist of a 460MW solar farm and a 540 MW/1,080 MWh ‘big battery’.

The solar farm is already in operation whilst the battery is being constructed in two stages – each of 270 MW.

The Stage 1 battery is under construction and is set to begin operation in the upcoming Australian summer.

The second stage will consist of 140 Tesla Megapack 2XL units.

The battery units will be provided by Tesla whilst construction will be undertaken by UGL.

The latest development comes amid concern that Australia may not be able to build a sufficient quantity of renewable energy generation and storage in time for the anticipated closure of the nation’s coal plants, which are currently expected to have completely shut down by 2038.

Overall, the Australian Government has set a target that renewable energy will account for 82 percent of all electricity which is generated throughout the country by 2030 (up from 39 percent in 2023).

In Queensland specifically, the state is aiming for 80 percent renewable energy penetration by 2035.

However, there are concerns that these targets will not be met as renewables are not being constructed fast enough.

The decision to commence construction comes after Neoen signed a 10-year ‘virtual’ battery contract with leading energy retailer AGL.

As many would realise, battery energy storage helps to ensure reliability in light of growing penetration of intermittent renewable energy resources (solar and wind power). It works by charging up the battery during the day using excess solar power and discharging the battery during the evening when solar power generation fades.

Essentially speaking, a virtual battery is a grid scale battery which enables energy generators and retailers to mimic the operation of a grid-scale battery without needing to undertake the cost and risk involved with having do physically develop, build and own their own battery.

Under the agreement with AGL, the energy generator/retailer will be able to virtually charge and discharge Neoen’s battery using software which is provided by Neoen.

This will enable AGL to effectively hedge its own customer load by charging/discharging the Neoen battery as it sees fit.

For Neoen, the second-stage battery brings the company’s storage portfolios in Australia to 1,925 MW / 4,709 MWh in operation or under construction.

This includes the 300 MW / 450 MWh Victorian Big Battery in Geelong and the flagship 150 MW / 193.5 MWh Hornsdale Power Reserve in South Australia, both in operation.

It also includes several batteries which are currently under construction. These include the 560 MW / 2,240 MWh Collie Battery in Western Australia, the 238.5 MW / 477 MWh Blyth Battery in South Australia, and the 100 MW / 200 MWh Capital Battery in the Australian Capital Territory.

Neoen Australia chief executive office Jean Christophe Chelyus welcomed the agreement and the start of construction of the second stage battery.

“We are delighted to secure this second virtual battery contract with AGL and value their continued trust in our innovation,” Cheylus said.

“We would like to thank Tesla, UGL and Powerlink for their commitment and dedication to making both stages of Western Downs Battery a reality.

“With Stage 2 taking our portfolio of assets in Queensland to over 1 GW, we look forward to supporting AGL and contributing to grid-reliability in the NEM.”

Meanwhile, UGL Managing Director Doug Moss said that the awarding of the contract will further help to consolidate the company’s leadership in construction of renewable energy assets across Australia.

As things stand, UGL has constructed 13 solar farms and seven large-scale batteries across the nation.

 

Enjoying Sourceable articles? Subscribe for Free and receive daily updates of all articles which are published on our site

 

Want to grow your sales, reach more new clients and expand your client base across Australia’s design and construction sector?

Advertise on Sourceable and have your business seen by the thousands of architects, engineers, builders/construction contractors, subcontractors/trade contractors, property developers and building industry suppliers who read our stories across the civil, commercial and residential construction sector