French renewables developer Neoen has trebled its storage revenues as a result of its Australian battery assets, which include the Victorian Big Battery, commissioned late last year, and the Hornsdale Power Reserve.
Neoen’s first-half 2022 consolidated revenue totalled AU$328 million (€224 million), up 36% compared to the first six months of 2021, it announced in its most recent earnings report. The company noted a key factor driving the growth was newly commissioned assets in Australia, namely its Victorian Big Battery.
The 300 MW/450 MWh Victorian Big Battery (VBB) in Geelong is currently the largest commissioned battery in Australia. According to Cornwall Insight Australia, Neoen posted an estimated AEMO wholesale net revenue of just over $13 million for the three-month period for the asset.
“It represents just over 8% of the project’s finance costs (costing $160m for the design, construction, and operation),” Cornwall’s William Curtis noted.
“The high turnover in Q2 2022 is not limited to VBB. Estimates for Hornsdale [Power Reserve] were around $10 million, and Wandoan at just under $5 million in Q2 2022,” it added.
“On a captured prices front, state-wide battery generation weighted average prices sat at $992/MWh in QLD, $653/MWh in NSW, $585/MWh in SA, and $363/MWh in VIC. A significant increase in recent history.
“Given that Q2 2021 saw FCAS account for 78% of revenue, it appears there has been a significant change in opportunities and focus.”
Given the surging wholesale energy prices in Australia, energy arbitrage’s opportunities “have never been more apparent,” Curtis says.
Neoen has the biggest portfolio of operational and planned utility-scale batteries Australia today, sitting at 576 MW. Late last year it begun construction of its 100 MW/200 MWh Capital Battery near Canberra and announced plans for 300MW and 800MWh battery in Blyth, north of Adelaide. The company is aiming to have a grid-scale battery in each of the five states participating in the National Electricity Market.
Goyder Renewables Zone
Neoen this week also announced it had signed a 10-year power purchase agreement (PPA) with retailer Flow Power for 40 MW of energy from its Goyder South Stage 1 project, part of the company’s flagship Goyder Renewables Zone – a hybrid wind, solar and storage project located near Burra in South Australia’s mid north.
The Goyder South Stage 1 wind farm, currently under construction, will have a total capacity of 412 MW and operations are expected to commence in 2024.
Goyder South has development approval for a total of 1200 MW of wind generation, 600 MW of solar generation and 900 MW of battery storage capacity, making it the state’s largest renewable project.
It is the second offtake deal inked for the project, the first being with the Australian Capital Territory’s (ACT) government which previously agreed to source electricity from the Goyder wind farm, allowing Canberra’s electricity supply will continue to be sourced from 100% renewable electricity in the coming years.
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