French renewable energy developer Neoen has signed a seven-year agreement with Australian utility AGL to provide 70 MW/140 MWh of virtual battery capacity in New South Wales.
Neoen said its virtual battery is the first of its kind in Australia and is planned to allow large electricity users or retailers to mimic a grid-scale battery without having to build or own one.
The offtake gives AGL Energy the ability to hedge its customer load by virtually charging and discharging a battery of 70 MW at any time over five minutes trading intervals.
Neoen plans to leverage its 100 MW Capital Battery in Canberra to provide the offering, saying the Capital Battery will retain its ability to deliver network services. Construction on Neoen’s 100 MW / 200 MWh Capital Battery began in December 2021 and the battery is expected to start operating in the first half of 2023.
Neoen said the virtual battery solution is “ideally suited” to managing the increasing challenges of the solar “duck curve” which sees oversupply in daylight hours followed by demand peaks in the evenings which challenge energy companies.
“This innovative and flexible offtake is extremely useful for a large electricity user or retailer by conceptually ‘charging’ the battery during low demand periods and ‘discharging’ it during high demand periods,” Neoen said. “This can be scaled to precisely accommodate the size that the customer needs,” it added.
The virtual battery capacity will be made available in the New South Wales region of Australia’s National Electricity Market.
“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,” Neoen Australia’s Managing Director Louis de Sambucy said.
“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.”