Thousands of homes and businesses in the Australian Capital Territory will be equipped with battery storage in coming years in the largest subsidised roll-out of battery storage outside of Germany.
More than 5,000 homes and households will get discounted battery storage under the latest round of capacity auctions for large scale renewables in the ACT. Around $25 million will be raised from the auctions for the specific purpose of subsidising battery storage installations in the national capital.
“Solar PV-battery storage will revolutionise the renewable energy sector by storing renewable energy so it is on demand exactly when we need it, reducing the need for network investment,” says energy and climate minister Simon Corbell.
“It means households can capture the maximum value of the energy they are producing and I am excited that the ACT is once again at the forefront of investment and innovation in this sector.”
The new auction will seek up to 109MW of capacity, likely from wind and solar farms. But each bidder will be required to allocate around $250,000 per MW of capacity to the battery storage support scheme.
The ACT will then hold separate auctions, seeking bids from battery storage developers who will seek a portion of the funds to roll out battery storage installations in the ACT.
It is expected to be keenly fought, as most of the world’s major battery storage developers have focused on Australia, which is expected to be the first “mass-market” for battery storage in the world, attracting global launches from the likes of Tesla, Enphase, Redflow, Ecoult and others.
The jury is out on how quickly battery storage will provide an interesting return on investment, although in the next few years it will likely be the focus of early adopters as others wait for costs to come down.
A pilot auction in the ACT has already been held, but the results will not be released for another few weeks. A total of 12 parties bid into the auction, a mix of battery storage developers and wholesalers and others.
The $25 million being set aside by the ACT for battery storage support compares to the $300,000 put forward by the Adelaide Council and the South Australia government in the next biggest support scheme in Australia. The ACT says its scheme is the biggest outside of Germany.
The large scale capacity auctions have proved very successful in providing contracts and finance to 450MW of wind and solar farms in recent years, underpinning nearly all the new wind and solar farm development in Australia as the federal government tinkers with the national renewable energy target.
The latest auction of large scale renewable energy will also take the ACT to its target of 90 per cent renewable energy by 2020. It has already conducted auctions for 50MW of solar capacity, and two auctions of 200MW of wind capacity. It plans to meet the equivalent of 100 per cent of its electricity demand from renewable energy by 2025.
One solar farm, the 20MW Royalla project (pictured above) has been completed, while another is being built, one wind farm in Victoria is already generating electricity and two other wind projects in Victoria and South Australia are being built. Other projects in NSW are still in planning stages.
“It is exciting to see the 90% renewable energy target on-track to be completed on time and with minimal flow-on cost for the Canberra community,” Corbell said in a statement.
The cost to householders to achieve the ACT’s 90% renewable energy target remains around $5 per household per week, which is offset by government mandated energy efficiency programs.
The request for proposals opens today and closes on May 13, with an industry briefing to be held in early April.