Renewables energy specialist Tag Pacific (ASX: TAG) says work is continuing on the design and manufacture of a battery energy storage system for Endeavour Energy’s electricity customers in the Illawarra region of New South Wales.
The system is believed to be the largest of its kind in NSW and is currently being assembled at the site of Endeavour’s planned West Dapto Zone substation.
It has been designed to minimise supply disruptions in the event of main grid failures and is planned to be fully-operational by year end.
Endeavour is a local power utility, supplying electricity to more than 2.4 million people in households and businesses across NSW’s Greater West, Blue Mountains, Southern Highlands, Illawarra and South Coast regions.
In October, Tag (through its subsidiary MPower) was awarded a contract to supply and install the one megawatt hour battery energy storage system at West Dapto, as part of Endeavour’s trial in helping reduce network capital costs and augment grid capacity.
The battery system will also enhance quality and reliability of supply through its ability to be disconnected from the main grid and operate as an “islanded micro-grid” during main grid power outages.
Tag said design work had been completed following modelling and analysis to develop the network protection regime required for mains and micro-grid modes.
Battery storage systems have the potential to reduce network capital costs, help manage load growth, peak demand, power quality and supply interruptions.
The technology is expected to experience significant growth as the cost of battery storage gradually falls and as benefits of the technology become more widespread.
Tag acquires Carnegie subsidiary
In June, Tag Pacific made moves to enhance its share of the solar and battery energy storage markets through the signing of a scrip-based agreement with Carnegie Clean Energy (ASX: CCE) to acquire 100% of Carnegie’s subsidiary Energy Made Clean.
The combined entity will become one of Australia’s largest companies in the rapidly-growing off-grid and fringe-of-grid solar, battery and micro-grid space and allow Tag to deliver scale and geographic expansion to Australia, New Zealand and the South Pacific region.
The acquisition will increase Tag’s net tangible assets by A$4.2 million, while the new entity would have had combined proforma revenues of more than A$50 million in the 2018 financial year.
On completion of the scrip-based transaction, Tag will rebrand to MPower and focus on the provision of Engineering, Procurement, Construction (EPC) and Build, Own, Operate (BOO) services.
The proposed transaction is subject to a number of conditions precedent including the approval of Tag and Carnegie shareholders next month.
It is also subject to the novation of existing key contracts.