26GW of battery storage in Australian pipeline

Newman Battery Storage Project
The Newman Battery Storage Project in the Pilbara

Research from Cornwall Insight Australia shows the pipeline of proposed battery storage projects is growing substantially to over 26GW of announced projects in the market and that the expected technical lifetime of those assets is increasing.

As a result, Cornwall Insight Australia has announced an increase in its Frequency Control Ancillary Services (FCAS) price forecast from 15 to 20 years to align with the increase in the lifetime of battery storage assets.

Cornwall Insight Australia principal consultant Ben Cerini said, “The energy market is accelerating toward a net-zero transition. As a result, storage and system services are playing increasingly important roles in the NEM to keep the system safe and secure and provide firm dispatch and deliver services essential to the continued penetration of renewables.

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“In our latest FCAS price forecast, we acknowledged that the lifetime of battery storage assets are increasing from what was a 10-15 year life only a few years ago to up to 15-20 years today (depending on warranties and cycling requirements). In light of this, we have extended our FCAS forecast from 15 to 20 years to better align with our client’s needs.

“FCAS currently makes up a significant portion of most storage business cases. Understanding each service’s price drivers and expected price changes will affect future project connection size and duration and the optimal time for refurbishment and extension planning. The extended duration of the curves allows new project developers to better understand the potential future FCAS cost liabilities for their assets for a more significant portion of their operational life to better reflect actual future costs.

“Extending our FCAS curves to 20 years provides our client with a more robust future projection of revenues and cost for projects. Furthermore, as more storage projects come to a financial close, robust and accurate FCAS curves are essential for favourable financing and project completion.”

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