Large-scale storage integral to future energy system

Guthega Dam, part of the Snowy Mountains hydro-electric scheme

The Australian Energy Market Operator’s inaugural Integrated System Plan (ISP) has endorsed large-scale energy storage to support the future electricity grid.

The 20-year plan, a key recommendation of the 2017 Finkel Review into the energy system, says energy storage will play a vital role in ensuring the grid is flexible, reliable and secure.

“To support the flexibility and system security required of this future energy mix, the ISP shows a strong role for energy storage that can shift renewable energy production at scale and provide firming support as well as system security,” the report says.

“The ISP examines how the Snowy 2.0 and Battery of the Nation proposals fit this need.

“Specifically, the plan identifies that increases in interstate energy interchange to take advantage of location diversity, coupled with large-scale storage and flexible gas generation, are essential components of a system that relies on significant levels of variable, zero-fuel cost (and hence low marginal cost) renewable energy.

“To accomplish this, the model demonstrates the economic value of network investment to efficiently support development of the Snowy 2.0 and Battery of the Nation proposals.”

The $2 billion Snowy 2.0 project will increase the generation of the Snowy Hydro scheme in NSW by 50 per cent, adding 2000MW of renewable energy to the NEM.

It was declared as a Critical State Significant Infrastructure (CSSI) project in March and a final decision to go ahead with the project is likely by the end of the year.

The Battery of the Nation plan aims to double Tasmania’s clean energy capacity with renewable energy and pumped hydro to make a greater contribution to the NEM.

Hydro Tasmania’s Battery of the Nation project director Chris Gwynne said the business supports strategic national energy market planning, as the ISP seeks to provide.

“There’s major uncertainty and risk in the future NEM. As the ISP notes, the market needs credible options (like Battery of the Nation) ready to deploy when needed,” Mr Gwynne said.

AEMO supports the continued development of the Battery of the Nation initiative to ensure it can be made available to the market, when needed, with the shortest possible lead times.

“We’ll keep working with AEMO, TasNetworks and others to deliver the most reliable and affordable clean energy future for Australia,” Mr Gwynne said.

“Battery of the Nation is about locking in energy security and giving Tasmanians the lowest possible power prices. It offers a future that’s clean, reliable and affordable.

“As our recent analysis has shown, Tasmania has huge natural advantages – including our existing hydropower system, exceptional wind resources and our existing expertise.

“Doubling Tasmania’s clean energy capacity, and introducing pumped hydro storage, would also create plenty of surplus energy to support mainland Australia as it phases out coal power.”

Battery of the Nation was recently added to Infrastructure Australia’s Priority List.

The Tasmanian and Australian Governments have committed to pursue the next stage of a business case for a second Bass Strait interconnector.