Energy utility EnergyAustralia says both of its proposed four-hour big battery projects are hoping to secure funding from the federal government’s Capacity Investment Schemes as it seeks to restore its fortunes after a major write down in the latest calendar year.
EnergyAustralia is owned by Hong Kong-based CLP, which had been looking for an equity partner to help fund the utility’s shift in the energy transition, but has put that idea aside for the moment until its earnings have been stabilised.
On Monday, EnergyAustralia reported a small operating loss of $44 million, after the previously announced write down of $1.1 billion in goodwill from its retailing operations, an action blamed on intense competition and rising costs.
The company said its earnings before interest, tax and depreciation rose to $444 million (before interest, tax, depreciation) from a $128 million loss a year earlier. It credited the improvement to higher profits from its generation, which include the Yallourn and Mt Piper coal plants.
EnergyAustralia plans to close Yallourn in 2028 under an agreement with the Victoria state government, the terms of which have not been released, although Mt Piper could be kept open will into the 2030s, despite ongoing issues with sourcing a secure coal supply. Its net zero target is set for 2050.
The company plans to build or contract only around 3 GW of new wind and solar capacity, but is spending most of its efforts on its various storage projects, which already include contract arrangements with the Gannawarra, Ballarat, Darlington and Riverina batteries, and the Kidson pumped hydro plant in Queensland that is still being built.
The company also has a couple of big battery projects it plans to build itself, including the Wooreen battery in the Latrobe Valley, near its Jeeralang gas plant, and the Hallett battery in South Australia, again next to an existing gas plant.
Wooreen is sized at 350 MW with four hours storage, while Hallett could initially be sized at 50 MW and 200 MWh, with the possibility of scaling up to a 200 MW and 800 MWh battery storage facility in the future.
EnergyAustralia says it hopes to begin construction of Wooreen later this year, but the timing and scale could be dependent on the results of the first round of federal government’s CIS auction, which is seeking 600 MW of capacity (and 2,400 MWh of storage) in Victoria and South Australia.
Competition, however, is fierce, with a growing number of battery projects presenting themselves as candidates. The first round of project bids closed last Friday. The results of the first round are expected mid year.
EnergyAustralia is also hoping to build its own pumped hydro storage project at Lake Lyell, near Mt Piper, and is commissioning its new 320 MW Tallawarra B gas power station in NSW, which it aims to run on 5 per cent green hydrogen by 2025, if it can source enough of it.
“We are also focussed on expanding customer energy resources including new initiatives to support retail and business customers to benefit from batteries if they have existing solar,” CEO Mark Collette said in a statement.
“While the scale and complexity of the clean energy transformation presents many challenges, the momentum we established in 2023 has EnergyAustralia well positioned to accelerate our customer’s energy transition and help Australia navigate the transition.”
