Four-hour MREH project attracts $400 million in debt finance, reaches financial close

The finance has been sourced from international debt syndicate comprising Export Development Canada, Societe Generale, Standard Chartered, and Westpac (MREH Debt Financing), and represents the first financial close of a 4-hour BESS in Australia’s National Electricity Market (NEM). The project was known as the Melton REH at one point.

David Russell co-founder and Managing Director Equis said the company found the equity partnership model to be a very effective vehicle for government industry collaboration to bring forward renewable energy projects.

“We think this model should be considered by other state governments because it allows investments to earn sustainable returns that can be reinvested in further renewable energy initiatives,” Russell said.

The largest battery system in Australia, the MREH will have up to 1,200 MW of charge/discharge capacity and has approval for up to 2.4 GWh of energy storage capable of servicing more than 1,100,000 households for up to 4 hours, or 200,000 during peak periods.

Under construction at Plumpton, Victoria, 32 kilometres from Melbourne’s CBD, the site is a confluence of critical Victorian transmission routes to the Melbourne metropolitan load that will firm up energy generated by wind and solar projects from the Victorian Renewable Energy Target auctions (VRET 1 & 2) and the Bulgana Green Power Hub, via a 500 kV transmission line.

Scheduled for completion in 2025, the co-investment partner, Victoria’s State Electricity Commission (SEC) will manage the MREH market operation.

Role for rooftop

According to Energy Infrastructure Australia (EIA), the MREH will also absorb excess roof-top solar from Victorian homes as it flows back into the transmission grid. It will also help regulate voltage and frequency on the grid, providing synthetic “system inertia” – providing the role filled by coal and gas fired power stations, which are set to retire over the next decade.

The project will use Tesla Megapack 2XL battery technology and a joint venture between Samsung C&T Corporation and GenusPlus Group will conduct the balance of plants (BOP) works for MREH.

Infrastructure provider Lumea is delivering the contestable connection assets for MREH as part of its delivery of the MREH substation, the Plumpton Renewable Terminal Station and AusNet Services will manage non-contestable augmentation at the Sydenham Terminal Station.

The MREH will also include a 12.5 MW co-located solar installation.