Battery firms to monitor Aussie plans for blackouts

Melbourne — Battery makers worldwide are watching to see whether Australia’s most wind power-dependent state can keep the lights on by installing grid-scale batteries by December that could help drive the growth of renewable energy across Australia and Asia.

A decade-long political stalemate in Australia over energy and climate policy has led to power and gas shortages and soaring energy prices threatening industry and households. If batteries help solve Australia’s problems by storing surplus electricity generated by wind and solar power, countries such as Indonesia, the Philippines and Chile could follow suit.
"I call South Australia the ‘perfect storm’ opportunity for energy storage," said Ismario Gonzalez, global sales director for AES Energy Storage, an arm of US firm AES, which has installed or is working on battery projects in seven countries, including Australia.
The more dependent the grid is on intermittent sources such as wind and solar, the more flexible the back-up sources need to be. That is the appeal of battery storage. It can be switched on and off easily, responding faster than a gas-peaking plant.

The state of South Australia, where wind and rooftop solar make up 44% of power sources, urgently needs to install big batteries after suffering blackouts over the past year.
The state government plans to spend 150-million Australian dollars ($115m) supporting the installation of 100MWh of battery capacity in 2017.

South Australia has yet to name a short-list of bidders, after receiving 90 expressions of interest from more than 10 countries. So by the time it signs contracts, the winner or winners will have only six months to meet a December deadline.
The state of Victoria is tendering to support construction of 100MWh battery capacity to be delivered in two stages by 2018. AES says lessons learnt in South Australia could be applied in Victoria, which is facing the loss of some coal-fired power, and Chile, where solar power is growing rapidly.
Stiff competition for the two state battery projects, with all the big makers such as South Korea’s Samsung SDI and LG Chem, Elon Musk’s Tesla and US firm Greensmith Energy in the running, will help drive down prices for energy storage, another factor that should speed up the spread of batteries with wind and utility-scale solar.

"Combined renewable energy generation and storage solutions are becoming genuine competitors with fossil fuel base-load generation. This will be the real game changer," said Josh Carmody, head of Australia for Equis Energy.

SAFETY PROBLEMS
A fund set up by former Macquarie bankers to invest in renewable energy projects around Asia, Equis Energy is building a large-scale solar farm in South Australia and is seeking state funding for batteries at the project.
Carmody said safety and performance problems as well as cost had been limiting the use of batteries in the energy supply system, but those challenges were being overcome rapidly. For battery providers, the money-making opportunity will come not only from energy storage but crucial extra services to manage voltage and frequency on grids, several energy storage executives said.
"Projects such as those in South Australia and California demonstrate there is now significant growth to come in the grid support sector," said Bruce Cole, East Penn’s senior vice-president of industrial sales.

Costs have come down 90% over the past 10 years, AES Energy Storage vice-president Brian Perusse said.
Reuters