Perth-headquartered Australian Vanadium Limited’s subsidiary VSUN Energy has begun the design phase of a vanadium flow battery energy storage system called Project Lumina, which is cost competitive and creates an offtake pathway for AVL’s vanadium oxide production.
Classified as Phase 2 of the project, VSUN Energy will develop a construction-ready, detailed design and delivery strategy for modular, commercial, turnkey, utility-scale 100 MW VFB BESS on a 4-hour (100 MW / 400 MWh) and 8- hour (100MW/800MWh) duration.
It will provide a definitive basis for its estimates of levelised cost storage (LCOS) analysed in the project’s first phase, which merited a 4-hour, 100 MW VFB BESS with an LCOS of $274 (USD 180.5) / MWh and for an 8-hour VFB BESS of $251 / MWh, to a scoping study level accuracy of ± 30%.
Image: Australian Vanadium Limited
VSUN Energy is proposing to design the VFB BESS to extend is operating life to 40+ years in a ‘deconstructed’ form, 10-years more than conventional VFB BESS.
For AVL, Project Lumina will provide an opportunity for offtake of its planned production of vanadium oxides from its Australian Vanadium Project and Australian-manufactured vanadium electrolyte, as part of the company’s ‘pit to battery’ strategy.
These vanadium oxides will be used in the midstream production of vanadium electrolyte, supporting VSUN Energy’s downstream VFB BESS installation, operation, and maintenance business.
AVL’s Chief Executive Officer Graham Arvidson said it’s a significant step to develop the downstream value of its business.
“The need for long duration energy storage in Australia is rapidly growing and the work the team is undertaking with Project Lumina is a key enabler to create a platform for us to deliver competitive long duration battery energy storage solutions,” Arvidson said.
“The scale of the projects VSUN Energy is pursuing aims to provide AVL with the ability to utilise our own manufactured vanadium electrolyte, ultimately unlocking the development pathway and full value of the Australian Vanadium Project.”
Compared to lithium-ion BESS, VFB BESS can conduct multiple full and partial charge and discharge cycles per day without significant degradation over time, allowing for flexible optimisation of the pricing arbitrage between charge and discharge cycles, as well as increasing the available hours of discharge potential throughout the day.
Image: Australian Vanadium Limited
The Australian Energy Market Operator’s 2024 integrated system plan (ISP) forecasts the requirement for medium duration storage (four to 12 hours) in the National Electricity Market (NEM) to grow from approximately 13 GWh in 2024/25 to an estimated 32 GWh by 2030, and 81 GWh by 2040 (excluding deep storage requirements already allocated to large scale pumped hydro projects).
The South-West Interconnected System Demand Assessment (SWISDA) forecasts an additional 50 GWh of growth to 2040 for the Wholesale Electricity Market (WEM) in Western Australia (excluding smaller regional networks and microgrid systems).
Combined, the NEM and the WEM are expected to require an average of 7 GWh of new installed medium storage per annum.
The implied average duration for AEMO’s forecast energy storage capacity, excluding pumped hydro, is approximately 11 hours.
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