South Australia to build gas plant, battery facility in $550m energy plan

The South Australian government has announced a $550 million plan to “take charge of the state’s energy future”.

The plan includes a new $360 million government-owned gas-fired power plant, as well as Australia’s largest battery storage facility.

Premier Jay Weatherill and Minister for Energy Tom Koutsantonis unveiled the plan today with new policies and systems introduced to “deliver South Australian power for South Australians”.

Energy Minister Tom Koutsantonis said the plan puts control of the state’s energy system back in South Australian hands.

“The first investment in generation since the privatisation of ETSA will give South Australians greater control over their own energy security,” Mr Koutsantonis said.

“For too long, South Australian households and businesses have been at the mercy of private companies seeking to maximise their profits and a national operator that manages our grid from Melbourne and Sydney.

“So far this year, we have seen frequent price spikes and supply shortfalls across the nation, but the Federal Government has refused to act.

“We can’t rely on this broken national market any longer.”

The new gas plant is budgeted to cost $360 million; $150 million will be committed to the new SA Renewable Technology Fund and new PACE grants worth $24 million.

It will be a fast-start aero derivative 250MW capacity system, designed to provide emergency back-up power and system stability services to prevent future blackouts.

Sites for the plant are being assessed, and a procurement process is expected to begin shortly.

APPEA SA director Matthew Doman said the new energy plan highlighted the importance of natural gas in smoothing Australia’s move to a low-emissions energy future.

“The state government has taken decisive action to ensure natural gas is once again playing a major role in meeting the energy needs of South Australia,” Mr Doman said.

“Today’s announcement to develop more gas-fired generation and encourage more local gas production will help secure reliable, affordable energy for South Australian homes, businesses and industry.”

The plan also includes new legislation to empower the state’s ministers to override the national electricity market, and direct the market to operate “in the interests of South Australians”.

The government will use its purchasing power through its own electricity contract to attract a new power generator, increasing competition in the market.

An Energy Security Target was also introduced as part of the plan which will require energy retailers to get more electricity from cleaner generators.

Premier Weatherill said the plan would restore security and put downward pressure on prices.

“We’ll get reliable, affordable and clean power and ensure more of the state’s power is sourced, generated and controlled here in South Australia.

“South Australia will now lead our nation’s transformation to the next generation of renewable storage technologies and create an international reputation for high-tech industries.”

The plan comes after Tesla chief executive Elon Musk offered to fix the state’s energy woes within 100 days.