SA to spend $500 million on Australia’s largest battery storage and gas power plant

South Australia has announced plans to install the nation’s biggest battery storage installation, as part of a state government response to the series of blackouts and what it says are the failures of the National Electricity Market.

The $500 million scheme includes plans for a new battery storage installation of at least 100MW, a new 250MW government-owned gas-fired generator to act as an emergency back-up, and a new “energy security” scheme that could encourage solar thermal and other storage technologies.

The state will also introduce a new competitor to the market through its previously announced government procurement scheme, will encourage more gas exploration, and will give treasurer and energy minister Tom Koutsantonis greater power to intervene in the NEM and instruct generators to deliver supplies.

The idea, premier Jay Weatherill said, is for the state to take control of its own energy future, and not rely on a “broken” National Energy Market, and to forge ahead with its push into renewable energy.

The tender for a new battery storage plant comes on the same day that Victoria announced its own plans for 100MW of battery storage and less than a week after Tesla’s Elon Musk promised he could build a 100MW plant in South Australia within 100 days, or deliver it for free.

Among those competing will be Tesla, Zen Energy (with Greensmith), Lyon Solar (with AES) and Perth-based Carnegie Clean Energy. Others are also expected to join.

The new installation will be funded through a new $150 million South Australia Renewable Energy Technology Fund, although he estimated that only around $15-$20 million will be needed for a plant, with the rest saved for later auctions and initiatives. Victoria is allocating a similar amount.

SA energy minister Tom Koutsantonis said the fund would split evenly between grants and loans, and will effectively duplicate the Australian Renewable Energy Agency and the Clean Energy Finance Corporation.

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Giles Parkinson