NSW's latest big battery project is expected to help accelerate the transition of the state's coal-dominated energy system to lower-carbon supply, while providing up to $135 million of benefits for the state's electricity consumers.

The $61.9 million battery to be built at the Wallgrove substation in Sydney's west, will involve Tesla "Megapack" lithium-ion batteries and will connect directly into the TransGrid network. It is due to come online next October, with trials to take place through to the end of 2023.