South Australia sets up $50 million Grid Scale Storage Fund

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After launching Australia’s biggest home battery subsidy scheme, South Australia has established the Grid Scale Storage Fund (GSSF), as one of the key components of its energy policy.

The GSSF aims to accelerate the roll-out of grid-scale energy storage infrastructure and address the intermittency of electricity supplies in South Australia, the nation’s traditional renewable energy leader.

The $50 million funding will be divided into two streams for both behind-the-meter projects in commercial and industrial facilities and centralized, bulk energy storage projects.

The fund is technology neutral and will support support projects such as pumped hydro, hydrogen, gas storage, solar thermal, bioenergy and battery storage.

Under the GSSF, applicants must be able to match funding dollar-for-dollar and preference will be given to projects targeting financial close by the end of 2019.

The single round of applications will close on 7 February 2019, to allow for successful projects to be announced by mid-2019.

“Eligible projects must benefit the state by addressing the challenges that have driven up electricity prices in South Australia,“ SA Minister for Energy and Mining Dan van Holst Pellekaan said.

“For example, projects could boost the reliability of our network during peak periods or increase the security of supply at the fringe of our grid.

“The fund will leverage South Australia’s world-class renewable energy assets, as well as the engineering and technology expertise within our business and investment community.”

The fund was originally announced as part of the SA Liberal government’s 2018/19 budget released in September. The budget saw a total of $180 million committed towards energy reforms, including $100 million for residential batteries for up to 40,000 SA households, known as the SA Home Battery Scheme, $50 million for grid-scale storage and $30 million to demand management schemes.

Co-funding

The SA state government has also signed a Memorandum of Understanding with the Australian Renewable Energy Agency (ARENA), with a view to coordinating the assessment of projects that may be eligible for joint funding under ARENA’s Advancing Renewables Program (ARP).

In order to be considered for joint funding, applicants will be required to register and complete a second application to ARENA through the ARP portal.

ARENA CEO Darren Miller welcome the commitment from the South Australian Minister to help bridge the commerciality gap for grid scale storage projects, which can help provide stable, reliable and dispatchable power to the state.

“ARENA has already committed up to $110 million in funding to support a wide range of projects in South Australia, including innovative energy storage projects. As more of our electricity is generated from solar and wind, it is clear that storage technologies will play a key role in delivering secure, reliable and affordable electricity,” he said.

On behalf of the Australian Government, ARENA is already supporting feasibility studies for two prospective pumped hydro plants at Cultana and Middleback Ranges, two virtual power plants trials and has contributed towards two grid scale batteries – Infigen’s Lake Bonney battery and the ESCRI battery in Dalrymple.