Neoen has signed a seven-year agreement to sell 70MW of energy from its 100MW Capital Battery project in Australia to with AGL Energy.
The offtake deal will give AGL Energy the ability to hedge its customer load in the New South Wales region of Australia’s National Electricity Market by virtually charging and discharging the battery at any time over five minute trading intervals.
It is ideally suited to managing the increasing challenges of the “duck curve” and evening peaks faced by large electricity users and retailers, Neoen said.
Construction of the Capital Battery commenced in December 2021 and the asset is expected to start operating in the first half of 2023.
The battery offer is a solution designed by Neoen to allow a large electricity user or retailer to mimic a grid-scale battery, without having to build or own one.
Neoen said it has also designed a bespoke and dedicated interface that allows the customer to submit live orders or use sophisticated predesigned dispatch strategies.
Neoen Australia’s managing director Louis de Sambucy said: “We are delighted to have AGL as our first customer for this innovative bespoke solution.
“The virtual battery is an ideal firming tool which will become a core Neoen product and a key element in the success of our expanding range of client offerings.
“With the Capital Battery currently under construction, we will soon be operating grid-scale batteries in three of the five states of the National Electricity Market and have multiple storage projects in development across Australia.”
AGL Energy Chief Operating Officer Markus Brokhof said: “As we continue with our plans for an orderly and responsible energy transition, we’re conscious of the need for flexible capacity that meets the energy needs of our customers to ensure they continue to have access to affordable and reliable energy.
“Neoen’s solution suits our needs perfectly.
“Our aim is to strike a balance between meeting Australia’s current and future energy needs while transitioning in a responsible way.
“AGL’s energy transition will be powered by innovations like this, bringing flexible capacity into the market and supporting increased investments in renewable energy, allowing us to prioritise customer supply while we make progress towards net zero.”
Neoen said it owns a battery storage portfolio of 576 MW in operation or under construction in Australia.
The company added that in addition to the Capital Battery, it also owns and operates the recently completed 300MW Victorian Big Battery in Geelong and the 150MW Hornsdale Power Reserve in South Australia.