Geelong will host one of the world's largest batteries thanks to an initiative by the state government which was welcomed by clean energy advocates but criticised by mainstream energy suppliers for imposing extra costs on Victorian consumers without independent scrutiny of whether it offers consumers value for money.

Victorian energy minister Lily D'Ambrosio said the storage project, to be developed and owned by French player Neoen and located at a critical juncture on the grid, would improve reliability of supply and keep a cap on power prices as coal power plants shut down.