Energy generating and retailing major AGL said it has reached a final investment decision on the 500 MW / 1,000 MWh grid-forming battery to be built at the site of its retired Liddell coal-fired power station near Muswellbrook in the Upper Hunter.
AGL said construction work for the estimated $750 million battery project is expected to begin in early 2024 with start of operations targeted for mid-2026.
United States-based large-scale storage specialist Fluence has been selected as the preferred engineering, procurement and construction provider.
The project will be supported by a $35 million grant from the Australian Renewable Energy Agency (ARENA) and a long-term energy service agreement arranged by AEMO Services on behalf of the NSW government.
ARENA said the Liddell battery, originally planned at half the size at 250 MW/500 MWh, is one of eight energy storage projects selected for support through the Large Scale Battery Funding Round. Together, these projects are expected to deliver a tenfold increase in grid-forming electricity storage capacity in the National Electricity Market (NEM).
The agency said each of the batteries will be equipped with grid-forming inverter technology, allowing them to provide essential system stability services traditionally provided by synchronous generation such as coal and gas.
ARENA Chief Executive Officer Darren Miller said batteries that are equipped with smart inverter technology which can help stabilise the grid are one of the pieces of the puzzle that will help to support the transition to 100% renewables.
“As new solar and wind connects to our grids, we’re going to need increasing amounts of energy storage to continue to provide reliable electricity to our households and businesses,” he said.
“However, as coal and gas generators retire, or start to play a lesser role, we’ll also need these new batteries to provide the crucial system security services that are currently provided by these traditional generators.”
AGL Managing Director and CEO Damien Nicks said the FID on the Liddell battery project, part of the planned Hunter Energy Hub, marks a significant milestone in the company’s decarbonisation pathway and the transition of its energy portfolio.
“The Liddell battery will be a key component of achieving our interim target of approximately 5 GW of new renewables and firming capacity in place by 2030,” he said.
Nicks said that once completed, the Liddell battery will add to AGL’s existing suite of grid-scale battery assets and contracted capacity from third parties.
This includes the 250 MW/250 MWh Torrens Island battery in South Australia, which commenced operations in August, and a 50 MW/100 MWh battery under construction at Broken Hill in New South Wales, which is expected to begin operations shortly.
AGL shut down the Liddell power station in April after more than half a century of operations as it looked to convert the site into a renewable energy hub.
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