AGL to convert Liddell coal site to giant battery
AGL plans to convert its Liddell coal power station in NSW’s Hunter Valley into a site housing a giant battery system.
AGL Energy plans to convert its Liddell coal power station in NSW’s Hunter Valley into a giant battery park as it moves closer to shutting down the ageing plant in the 2022-23 summer, underlining an accelerating transition to renewables from the fossil fuel that currently props up the grid.
The power operator has devised a scheme to install a 500MW battery system at Liddell, marking one of the biggest rollouts of the storage technology in Australia, although still less than a third of the existing 1680MW coal plant capacity.
The first phase of the Liddell battery system will be 150MW within the next few years, but AGL hopes to gain planning consent for the entire 500MW total spread across the coal plant site after lodging a scoping report with the NSW Department of Planning.
Coal output fell to its lowest level on record in the June quarter within the national electricity market as the fossil fuel continues to face challenges from renewables during daylight hours.
Committing to the battery project also reflects where the company expects to prioritise investment with new coal-fired plants not seen as feasible, AGL said.
“The main driver for us is that we want to further promote renewable energy and by building this battery we firm up renewables,” AGL’s chief operating officer Markus Brokhof told The Weekend Australian. “It should help the bottlenecks on the grid and also help with firming and increasing the share of renewables. You can also read between the lines that AGL will not invest in another baseload power station in the next years, which is not feasible under the current market conditions.”
AGL, which issued a bleak earnings outlook for the 2021 financial year on Thursday, remains Australia’s biggest coal generator but has significant ambitions in storage, with a plan outlined at its annual results to install 1200MW of batteries and demand response by 2024.
The future of the half-century old Liddell coal plant – which provides 10 per cent of the state’s power – has been politically contentious for several years, after former prime minister Malcolm Turnbull fought a bitter brawl with AGL to delay its closure or sell it to other suitors that would invest in its extension.
Governments both state and federal have been worried they may face a repeat of the market chaos that followed the closure of the giant Hazelwood coal plant in Victoria two years ago, which contributed to a 40 per cent surge in power prices.
AGL conceded some ground last year by extending the closure of the plant until the end of the 2022-23 summer.
Coal still accounts for about 70 per cent of electricity in the power grid but the Australian Energy Market Operator forecasts 63 per cent, or 15 gigawatts, of the country’s coal fired generation will retire by 2040.
By 2035 nearly 90 per cent of power demand could be met by renewable generation during periods through the day, forecasts by AEMO show. However, that will require up to 50 gigawatts of large-scale solar and wind to be added under the most aggressive plan to cut emissions, representing nearly all the current capacity of the market to be built in just two decades.
Planning applications are also being developed for a battery connected to Torrens Island Power Station site in Adelaide. The South Australian battery would help fill in the gaps between solar and wind generation, Energy Minister Dan van Holst Pellekaan said.
“Another big battery will help address the legacy of power security issues that we inherited from Labor,” Mr van Holst Pellekaan stated.
AGL, Australia‘s largest power supplier, has already announced plans to operate a Queensland battery matching Elon Musk’s South Australian facility in size.
The Sydney-based company will buy output from the 100MW project at Wandoan as part of a 15-year operating deal signed in late January.
However, bragging rights for matching the Tesla chief’s record may prove short lived, with the South Australian big battery in line for a further 50 per cent capacity boost to 150MW from its current 100MW size.
More Coverage
