French firm Neoen will build a mega battery in Collie after winning a two-year contract to smooth out energy supply and demand in Western Australia's south-west grid, which is under strain from soaring midday peak supply from rooftop solar and ageing coal-fired power stations.
The battery, to be constructed from 224 Tesla "Megapacks", can store 219 megawatts of energy for four hours during the day and discharge it back to the grid during high demand in the evening when solar generation falls.
The investment comes as the South West Interconnected System that stretches between Kalbarri, Kalgoorlie and Albany needed to use "last resort" expensive diesel generation on most days in June due to unexpected shutdowns at two coal-fired power stations in Collie run by state-owned Synergy.
The contract from the Australian Energy Market Operator that manages the SWIS requires the new battery to be operational from October 1, 2024, just 15 months away.
AEMO chief executive Daniel Westerman said the battery would make the power supply more secure and reliable.
"As WA's major electricity system transitions away from coal-fired generation, critical investments are needed in low-cost renewable energy backed by firming generation, such as batteries and gas, and augmentation of the transmission network," he said.
UGL, a subsidiary of Spanish-owned CIMIC, has started construction on one of four grid-scale batteries in the south-west of WA. No cost was provided for the battery.
Synergy is commissioning a battery in Kwinana that can store 100 megawatts for two hours that was originally meant to be operating by the end of 2022.
In the May budget, the WA government allocated $2.3 billion for two further batteries.
Synergy will build another battery at Kwinana that can store or discharge 200 megawatts for four hours that is expected to start operating by late 2024.
The government has also funded 500 megawatts of storage for four hours at Collie but gave no schedule for completion.
Neoen's announcement on Tuesday was the first stage of its own Collie project, which has development approval to expand to 100 megawatts of storage for four hours.
Energy Minister Bill Johnston said while the WA government was replacing its own coal-fired power stations with renewable energy, it was also critical for the private sector to get involved in the state's energy transition.
"Big batteries like this one will help smooth out the peaks and troughs in the SWIS by storing energy during times of low demand and releasing it into the grid in times of peak demand," he said.
A workforce of 120 will construct the battery near Collie, whose workers have an uncertain future with both the town's coal mines struggling financially and Synergy closing its Collie and Muja power stations in 2027 and 2029 respectively.
Bluewaters, the state's third coal-fired power station, is privately owned.
Shire of Collie president Sarah Stanley said the town was proud of its long history of powering WA.
"Renewable energy infrastructure, such as Neoen's big battery, is a key factor in the attraction of new, innovative and sustainable industries that will cement Collie's place as an important industrial hub," she said.
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