Big Batteries Slowly Saving the Grid

It is sometimes hard to envision but Australia’s power system is rapidly going through a renewables revolution as it transitions away from coal power and towards solar and wind power.

One of the key parts of this transition is the provision of large batteries capable of turning the at times intermittent renewable supply into an around the clock power source.

A piece of this puzzle recently received fast-tracked approval—a giant 1 gigawatt (GW), 2.5 gigawatt-hour (GWh) big battery project near Victoria’s Portland, close to its aluminium refinery.

Strategic Portland Location

The location of the big battery is no coincidence, being close to the power hungry Portland Aluminium Smelter and the Portland Water Treatment Plant, which will enable it to provide energy security to these strategic businesses.

The state government says it has now fast-tracked 20 renewable energy projects since the first in August last year, worth a total of about $6 billion.

The battery project is split into four 250-megawatt units with between two hours and four of storage each and is to be built by UK-based Pacific Energy, which is already developing the first stage of a similar sized project in South Australia.

The Portland battery was fast-tracked through the state government’s Development Facilitation Program, which promises a yes or a no from the department of planning within four months.

It is expected to start operating by 2028.

Existing Batteries Soaking up the Solar

The Portland battery announcement came as existing batteries showed their benefits when wholesale power prices turned negative recently.

Battery charging then reached a new peak of sucking up more than one gigawatt of power, soaking up around half of the 2.1GW of power that rooftop solar was pumping into the grid.

It is not hard to see the economic and practical applications at work here, even if it is just a glimpse of what is to come.

The old share market adage of buying low and selling high is just as applicable to the power market with the power market having the added advantage of being much more predictable.

Price Arbitrage Incentivises Battery Use

As wholesale power prices head towards zero as solar power becomes abundant during the day, the storage solutions will happily soak up any excess, supplying it back to the grid at a convenient time when wholesale prices have risen considerably.

It is a scaled-up version of what is happening in many more households as generous battery subsidies allow households to time shift the power that their rooftop solar is producing.

The number of large battery storage plants is increasing, with the first stage of the Melbourne Renewable Energy Hub soaking up the record amount of power alongside the recently complete Latrobe Valley, Rangebank and Koorangie batteries plus the Victoria Big Battery and the Hazelwood battery.

Victoria has nine operating big batteries and plans for many more to come including the big Portland units.

It would be naïve to assume that we are already doing enough to effectively supply renewable power around the clock but with renewable goals, government support, strong economic incentives for power shifting and ever cheaper solar panels coming on stream, it is not hard to glimpse a future in which power is not only much more plentiful but also cheaper.