Australia to replace coal plant with record-busting 850MW battery

Newcomer Akaysha Energy won backing from investment giant BlackRock and now will build a gargantuan battery in New South Wales.

Two large cement towers fall to the ground near a lake surrounded by trees
The emission stacks at the Munmorah Power Station were toppled on March 26, 2017. (Chris Richardson/Shutterstock.com)
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Australia will build the world’s biggest contracted battery to help position the country to shut down its biggest coal plant. Newcomer energy storage developer Akaysha Energy won the contract this week to build it.

The startup will deliver an 850-megawatt/1,680-megawatt-hour behemoth called the Waratah Super Battery in New South Wales. The battery will sit on the former location of the Munmorah coal plant, and it will deliver capacity to the grid to support the 2025 closure of Eraring, Australia’s largest coal plant.

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The 2017 demolition of the Munmorah Power Station in New South Wales, Australia (Liberty Industrial)

Akaysha’s project would far exceed the current record for the largest grid battery in the world, carrying battery-plant capacity into the realm of large thermal generators. 

Today, Recurrent Energy’s recently activated Crimson Storage facility in Blythe, California claims the title of single-largest battery storage project at 350 megawatts/1,400 megawatt-hours. Vistra’s Moss Landing facility in Northern California has 400 megawatts/1,600 megawatt-hours (when fully operational and not shut down by fires), but that capacity total was achieved over two phases of development. 

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Of course, Akaysha needs to finish the project before it will win the title. Other companies could build something bigger before Waratah reaches completion. But the fact that Waratah has an official contract in hand enhances its odds of actually happening.

This also represents perhaps the highest-profile attempt worldwide to shut down coal plants and build renewables-powered batteries in their place. That’s a critical proof point for the global effort to stop climate change by zeroing out carbon emissions from the power grid.

We believe a successful shift to a more sustainable energy future is dependent on the use of large-scale battery storage,” Akaysha Managing Director Nick Carter said in an email. In fact, utility-scale energy storage technologies are very helpful in mitigating the variability of renewable generation as well as deliver grid reliability and resilience to the power system networks across the world.”

Australia’s renewable electricity generation has more than doubled in the last decade thanks to rapid growth in solar and wind production, according to the government. In 2021, renewable generation hit a record 29 percent. But the country’s transmission grid has limited ability to take momentary surges in production in one area and distribute it to other population centers. 

That’s where Waratah comes in. It can help absorb renewable power and discharge it when it’s more in demand, as the big batteries in California do. But that’s not Waratah’s primary objective. Instead, it will maintain grid reliability by instantly discharging its massive capacity if disruptions like lightning strikes or bushfires interrupt the flow of electricity. 

Having that in place allows the transmission lines to move more electricity throughout the day, because if a given line trips off, the battery will be there to fill in the gap, Carter explained.

This project is a great example of how existing transmission infrastructure can be more optimally used in the face of rapid renewable generation growth and the decline in synchronous thermal generation,” he added. By unlocking the excess network capacity, both existing and new renewable generators will supply more reliable and stable energy to the families and businesses of [New South Wales].”

New kid on the block has a massive hit

It’s rare to see companies clinch world-historic grid battery deals without having actually built a battery project, but that’s what Akaysha has done.

Akaysha’s website lists a current” portfolio of three battery storage projects (Waratah is not yet included), all of which are described in the future tense on account of not having been built yet.

Not that the team is starting from scratch. Managing Director Nick Carter hails from Macquarie Group’s Energy Technology and Solutions business, which was an early and enthusiastic investor in grid storage assets. Before that, he sold utility-scale storage for Tesla — the company that famously supplied the world’s biggest battery in South Australia in 2017. Carter’s LinkedIn page notes he worked for Tesla from 2016 to 2018, the period during which the company delivered the 100-megawatt Hornsdale Power Reserve in less than 100 days.

Akaysha compiled a very detailed technical and commercial response to the tender,” Carter said, based on the team’s collective deep experience” across practically all aspects of battery development. Besides project finance and development, team members have worked with autonomous bidding software and market modeling and optimization, all of which are crucial to performing in Australia’s competitive power market.

In August, BlackRock bought Akaysha outright on the strength of its team and pipeline. The financial giant pledged to invest USD $700 million in the Australian grid battery space through Akaysha as its development platform.

Two weeks after that acquisition, Akaysha announced it was buying 1.7 gigawatt-hours of grid storage units from Powin, the Oregon-based company that buys batteries and integrates them into fully functional storage cubes. Akaysha also is getting power conversion from Powin’s wholly owned subsidiary EKS Energy.

Powin’s vertically integrated and flexible business model reduces project cost and risk by having multiple trusted cell suppliers, proprietary software and an in-house power plant controller,” Carter said. 

That was a staggering purchase order to make for a shop that, again, had never built anything. But the storage market has encountered a prolonged period of scarcity as manufacturers struggle to keep pace with soaring demand for both electric vehicles and grid batteries. Customers increasingly need to lock in multiyear, multiproject supply deals if they want to ensure they have enough batteries on hand when the time comes to install them.

The logical conclusion in August was that Akaysha had preemptively locked in supply for its portfolio of more modest projects. Now we know that Waratah alone will gobble up all 1.7 gigawatt-hours. It will be installed by Consolidated Power Projects Australia, an experienced engineering, procurement and construction contractor that built Hornsdale, among other Australian battery projects.

Blazing the trail from coal to renewables

Global efforts to zero out carbon emissions by 2050 hinge on finding clean and reliable sources to replace dirty coal power plants, still the mainstay of the electricity grid in much of the world. 

In the U.S., fossil gas plants and cheap renewables have sent coal power into permanent decline. But a few locations around the world are now jumping straight from coal to the combination of batteries and renewables, skipping decades of what was once argued to be necessary investment in the so-called bridge fuel” of gas.

Batteries, of course, can’t provide round-the-clock, baseload energy like well-stocked coal or gas plants can. But they can store cheap renewable production and deliver it during the hours of greatest need. The goal isn’t to create a battery that exactly replicates the operational profile of the outgoing coal plant — that would be impossible and unnecessary. But forward-thinking grid operators are identifying particular functions served by coal plants and filling those needs with a portfolio of renewables and batteries.

Hawaii’s most populous island, Oahu, shut down its last coal plant this summer. A 185-megawatt battery, nearly identical to the outgoing coal plant in how much power it can discharge, will come online down the street from the coal plant early next year. If the grid needs the same burst of power that the coal plant provided, this battery will be able to do that, for a time. But it also was specially engineered to maintain grid frequency, and to jump-start the grid if a disaster knocks it out — two technical roles the coal plant played besides simply delivering electricity.

New South Wales faced its own coal-exit challenge earlier this year when power company Origin Energy declared it would close 2,880-megawatt Eraring seven years earlier than previously planned. That would eliminate about one-fifth of New South Wales’ electricity production in 2025, leaving the grid more dominated by intermittent wind and solar.

At the time, The Guardian quoted Matt Kean, New South Wales’ treasurer and energy minister, saying the state would construct the biggest battery in the Southern Hemisphere” to avoid problems on the grid in 2025. The state awarded the anchor contract to Akaysha, though the latter will build a bigger battery than required to enable the plant to participate in and earn revenue from the energy markets, Carter noted.

Interestingly, the contract was not structured like that of a typical power plant, but rather as a virtual transmission solution that will increase the transmission capacity of the existing network.” This will also pave the way for new renewable generation that is planned for New South Wales, Carter added.

Treating batteries as transmission infrastructure is a relatively new concept, just now percolating from white papers to contracts in geographies with extreme swings in renewable production. Southern Australia has huge surges in renewable generation, with limited transmission and storage infrastructure to distribute it across space and time. Building one of the world’s biggest batteries will help.

Julian Spector is senior reporter at Canary Media.