Out-Law News 1 min. read

Australia announces A$100m grant for battery storage projects


The Australian Renewable Energy Agency (ARENA) has set aside A$100 million (US$72m) to fund commercial scale batteries equipped with advanced inverter technology.

At least three projects will be supported by the funding, according to ARENA, with a maximum of A$35 million available for each project.

Advanced inverters allow for more refined monitoring and communication of grid status, enabling grid-scale batteries to provide system stability services that traditionally must be provided by synchronous generation such as coal or natural gas. As a result, the grid could be operated using a higher share of variable renewables.

The new grant is available to new-build large scale battery storage (LSBS) projects, existing grid scale batteries seeking to retrofit advanced inverter capability, and projects looking to expand an existing LSBS asset by constructing a new LSBS asset.

The battery needs to have at least 70 megawatts (MW) capacity and will have to operate in the National Electricity Market (NEM) or Western Australia’s wholesale electricity market.

Renewables expert George Varma at Pinsent Masons said: “Investment in the development of inverter and battery storage technology appears to be a sector ARENA is investing in to promote growth and to flatten the peaks and troughs of electricity prices driven by the influx of renewable energy at certain times.”

“Grid stabilisation is a key issue the electricity market must grapple with as renewable energy penetration into the market increases.  Finding ways of efficiently and effectively storing excess energy generated during peak production periods and introducing that power back into the grid when renewable energy generation is low at night will be key to helping with the country’s energy transition goals.  Developing energy storage capabilities will also help us to provide green power to remote communities in a cost-effective manner,” he said.

Expression of interest for the grant will open in February and close on 31 March 2022. Successful applicants will be invited to make a detailed submission later in the year.

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