Boosting the security of Victoria's energy grid
25 February 2021
Victoria’s energy grid is getting a critical boost from the Morrison Government with a $160 million investment through the Clean Energy Finance Corporation (CEFC).
The Government is supporting the construction of Neoen’s 300MW / 450MWh Victorian Big Battery to help strengthen grid security, drive down power prices and support the integration of more renewable energy into the grid.
This follows a competitive tender process run by the Australian Energy Market Operator, which will enter into a contract with Neoen to reserve 250 megawatts from the battery to increase the capability of the Victoria to New South Wales Interconnector and respond to unexpected network outages.
These services could see average industrial electricity consumers save as much as $280,000 a year on their bills, while the Portland aluminium smelter, a major user of electricity, could see its bills slashed by $1 million a year.
Minister for Energy and Emissions Reduction Angus Taylor said the project would give Victorians confidence in their state’s energy system.
“All Australians need access to reliable and affordable power, which is why the Morrison Government is focused on keeping the grid secure,” Minister Taylor said.
“After the challenges of COVID-19, this is more important now than ever to support jobs, families and businesses in Victoria. We are working to ensure electricity prices do not hold Victorian industry back and this project is crucial to that objective.
“Investments in batteries can help stabilise our grid at a time of record investment in renewables. We will also need investment in longer duration firming and storage like the Snowy 2.0 project.
“The Morrison Government has a clear focus – lower emissions, lower costs and more jobs – and is committed to investing in the next generation of energy technologies such as long-duration energy storage that will deliver this.”
Long-duration energy storage is a priority technology under Australia’s Technology Investment Roadmap.
The Technology Investment Roadmap outlines five priority technologies and economic stretch goals to make new technologies as cost-effective as existing technologies. This includes getting long duration energy storage (6-8 hours or more) dispatched at less than $100 per MWh. This will enable reliable, firmed wind and solar at prices around the average wholesale electricity price of today.
Getting the technologies of the future right will support 130,000 jobs by 2030, and avoid in the order of 250 million tonnes of emissions by 2040.
The CEFC senior debt facility will finance the design, construction and operation of the Victorian Big Battery.
The project will create more than 80 jobs during construction and support various ongoing positions once operational.
The Victorian Big Battery will be one of the largest energy storage facilities in the world and is expected to be online for the 2021-22 summer.
Minister Taylor's office: 02 6277 7120