In a tender initiated by the Western Australian Coordinator of Energy, the Australian Energy Market Operator (AEMO) has awarded Neoen a 197 MW / 4 hour capacity services contract.
Stage 1 of Collie Battery, which has a 219 MW/877 MWh capacity and comprises 224 Tesla Megapack 2XL units, will provide the service. Neoen started the project in 2021, and in December 2022, it was given development clearance for a total of 1 GW / 4 GWh. The battery will be situated in the South West of Western Australia (WA), close to the town of Collie, on the territory of the Wilman people of the Bibbulmun nation. It will link to the Shotts Terminal substation of Western Power, a South-West Interconnected System (SWIS) component.
“Western Power is working collaboratively with proponents to ensure that we expedite the transition of our network to a sustainable energy system that paves the way for community and industry to reach their decarbonisation goals. Connecting renewable energy solutions, such as Neoen’s large scale battery, are critical to unlocking a cleaner energy future, that allows renewable resources to be effectively harnessed and utilised to meet the community’s power needs now and into the future,” Western Power CEO Sam Barbaro said.
Neoen has issued notices to proceed to Tesla and construction contractor UGL (a member of the CIMIC Group), signifying the start of work for Stage 1 of Collie Battery. It is scheduled to be operational in the fourth quarter of 2024. The battery is Neoen’s first significant project in WA and will be the world’s first 4-hour long-duration battery. It exemplifies Neoen’s approach of increasing storage investment through longer duration, allowing it to extract more value from its batteries. According to the company, long-term storage is becoming increasingly crucial in transitioning to increased renewable energy penetration.
The AEMO Non-Co-optimised Essential System Services (NCESS) contract will run for two years beginning 1 October 2024. It will offer 197 MW of storage capacity for four hours, charging during the day and discharging during the evening peak. This is designed to address the concerns identified by AEMO associated with the retirement of coal power stations and the rising penetration of rooftop solar in WA.
AEMO CEO Daniel Westerman stated, “As Western Australia’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. Neoen’s Collie Battery, procured through AEMO’s NCESS process, will provide consumers with energy security and reliability during the transition to firmed renewables.”
“We are delighted to have won a NCESS contract and would like to thank AEMO, Western Power and the WA Government for placing their trust in us. This is an exciting time for Neoen as it is our first major project in WA, and it also means we now have a big battery in five of the six Australian states. With our growing team in Perth and a strong pipeline of projects we look forward to playing an increasingly significant role in the state’s rapid decarbonisation,” Neoen Australia CEO Louis de Sambucy said.
Energy Policy WA Coordinator of Energy Jai Thomas noted, “The NCESS process run by AEMO was created through the WA Government’s Energy Transformation Strategy, and it is great to see Neoen’s Collie Battery progress as a result of these reforms. Big batteries like this one will help balance the needs of the energy system by enabling us to take advantage of more of our plentiful renewable energy resources.”
As part of the region’s energy transition, Collie Battery will provide a considerable economic boost to the Shire of Collie, creating over 120 construction jobs and possibilities for local suppliers. An annual community benefit-sharing program will be developed in collaboration with the local community.
“We are very proud to continue our long history of powering the state. 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, providing worthwhile employment opportunities for generations to come,” Shire of Collie President Councillor Sarah Stanley said.
“I would like to congratulate the Neoen team on achieving this excellent outcome in record time. This project perfectly demonstrates our ability to rapidly provide solutions to the market and we are thrilled to start delivering longer duration battery services. Neoen is incredibly proud to be one of the world’s true pioneers in battery storage, with a global portfolio of over 1.3 GW / 2.6 GWh, and to be making a major contribution towards a more sustainable energy future,” Neoen Chairman Chief Executive Officer Xavier Barbaro commented.
