Siemens joint venture looks to top Tesla's battery for Australian power grid

Australia is seen as a perfect testing ground for innovation in clean energy

epa08409105 (FILE) - Siemens logo on a train car at the Inno Trans 2018 convention in Berlin, Germany, 17 September 2018 (reissued 08 May 2020). Siemens on 08 May 2020 released their January 1 to March 31, 2020 results, saying their revenue stood at 14.2 billion euro, almost same as year before, while net income, including a loss of 0.3 billion from discontinued operations, stood at 0.7 billion compared to 1.9 billion euro in Q2 FY 2019. Siemens said they cannot confirm their original guidance for fiscal 2020 because of the current ongoing situation.  EPA/OMER MESSINGER *** Local Caption *** 54633534
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Three years after Elon Musk took up a challenge to solve Australian power outages by building the world’s biggest battery, a Siemens venture wants to install even larger ones to bolster renewable investment in the nation.

Fluence, a partnership between Germany’s Siemens and Arlington, Virginia-based AES Corporation, is proposing to build two giant lithium-ion batteries at strategic points on the transmission grid to allow better access for clusters of wind and solar plants. It says it can have the units up and running within 18 months, much quicker than building out transmission infrastructure to accommodate more renewables.

Australia is seen as a perfect testing ground for innovation in clean energy, as a developed market with plenty of space to benefit from its abundant sunshine and wind. There’s also a need for new capacity with the expected retirement of several aging coal-fired plants over the next decade. However, regional grid bottlenecks and a lack of clear central policy saw investment in the sector drop by 38 per cent last year, according to BloombergNEF, following strong growth in the prior two years.

To solve the issue of bottlenecks, Fluence is touting “virtual transmission lines” that would integrate battery storage systems along the network, injecting or absorbing electricity as needed and regulating frequency and voltage. In a submission to the Australian Energy Market Operator (AEMO), Fluence proposed installing two 250 megawatt facilities, which would eclipse the 150 megawatt battery at Hornsdale in South Australia, installed by Mr Musk’s Tesla in 2017 and currently billed as the world’s largest.

“Think of it as being able to widen a highway instantaneously to accommodate surges in traffic,” Jaad Clifford-Bolt, senior business development manager at Fluence, said in an email. “That surge could be solar or wind output on either side of the interconnector that needs to be exported, or a sudden spike in demand on either side.”

Batteries also avoid the need to build the infrastructure required in “traditional poles and wires solutions,” he said.

“This lets you place them where they can provide the greatest value and relief for the network, whether that is at a solar farm, a substation or completely on its own at an advantageous connection point,” Mr Clifford-Bolt said.

The sticking point for batteries until now has typically been the price tag, but that has been cut in half since 2018, according to BloombergNEF. Fluence, which already operates a 30 megawatt battery storage system at Ballarat in Victoria state, declined to comment on the cost of its project.

Solar and wind facilities in Australia have tended to focus on areas with access to cheap land and a favorable weather profile, but these clusters are often in remote regions with limited grid access. Last year, AEMO was forced to curtail as much as 50 per cent of the output of several facilities due to concerns they might compromise system stability.

AEMO’s long-term plan to transition toward a decarbonised grid backs investment in new or upgraded transmission links, but the operator has also put a call out for “non-network options” to assist the process.

Fluence is not the only company looking to scale up battery technology. France’s Neoen, which owns the Hornsdale facility, has submitted a proposal to install a 600-megawatt unit near Geelong in Victoria.