By Nick Toscano
Electricity giant AGL has secured planning approval to build a grid-scale battery on the site of the soon-to-be-closed Liddell coal-fired power plant in the Hunter Valley, beginning its proposed transition to a low-carbon “energy hub”.
The NSW government is preparing to announce on Saturday it has granted planning approval for AGL’s plans to build the grid-scale battery with a capacity of 500 megawatts and 2 gigawatt hours, making it more than three times the size of the “Tesla Big Battery” famously built by Elon Musk in South Australia in 2017.
The Liddell coal-fired power station is set to close in 2023.Credit: Dominic Lorrimer
NSW Treasurer Matt said the Liddell battery was set to play an important role in ensuring reliable electricity and keeping a lid on power prices as coal-fired generation is increasingly withdrawn from the east coast grid.
“Big batteries combined with solar, wind and pumped hydro will help to deliver some of the cheapest and most reliable energy to the families and businesses of NSW,” he said.
Mr Kean described the planning approval as a big win for the Hunter Valley, and said he expected the project to generate 100 construction jobs and $763 million of investment.
As the transition away from fossil fuel-based electricity gathers speed in Australia and around the world, battery technology is emerging as key to supporting the greater uptake of renewables because of its ability to soak up and store excess wind and solar power when demand is low and release it during periods of high demand when the wind isn’t blowing and the sun isn’t shining. Batteries are also used to provide inertia services to ensure the grid remains stable if disruptions emerge.
AGL’s Liddell battery is part of the company’s planned national roll-out of 850 megawatts of grid-scale batteries, with construction under way at Torrens Island and planning progressing at Broken Hill and Loy Yang.
AGL chief operating officer Markus Brokhof said the transition of the Liddell coal-fired power plant into an integrated, low-carbon energy hub would mark company’s first rehabilitation of a thermal coal site.
“This planning approval marks a significant milestone for the transition of the Liddell site,” he said. “We look forward to working with partners to progress other developments on and around the site, including a wind farm, a solar storage system, pumped hydro, a waste-to-energy plant and our recently announced green hydrogen pilot with Fortescue Future Industries.”
It comes as AGL is progressing plans for a split of its business. Under the proposal, a company called AGL Australia would own its retailing division and some cleaner generation assets, while a new entity to be called Accel Energy would house its fleet of carbon-intensive coal- and gas-fired power stations. As part of the demerger, AGL has mapped out plans to diversify these ageing thermal power sites into “hubs”, which may include big batteries, hydrogen production and carbon capture and storage.
Last month, AGL became the target of a $9 billion takeover offer from tech billionaire Mike Cannon-Brookes and Canadian asset manager Brookfield, which are seeking to scuttle the demerger, fast-track the closure of AGL’s coal-fired power stations and spend $10 billion to $20 billion investing in large-scale clean energy projects.
AGL’s board has knocked back the bidding consortium’s offers so far, arguing the offer understated the value it believes will be unlocked through the demerger, including its vision for energy hubs.
The first unit of Liddell is due to close in April 2022, with the following units to close in April 2023, AGL said.
If shareholders approve AGL’s proposed demerger in a vote later this year, the Liddell battery would be an asset of Accel Energy.
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