Australia’s NSW opens largest energy storage tender in history

The NSW government’s largest energy storage tender in the state’s history has now opened, offering support for up to 1 GW of projects that can each release energy into the state’s grid for at least eight hours, equivalent to the daily energy consumption of 505,000 houses.

In concert with the launch of the NSW Electricity Infrastructure Roadmap Tender Round 5, the tender also accepts applications for the right to connect projects in the South West Renewable Energy Zone (REZ).

The tender’s long-duration storage long-term energy service agreements (LTESA) feature a series of two-year options to receive annual payments for a contract term of up to 14 years for battery energy storage systems and 40 years for pumped hydro. Projects must have been committed in NSW after 14 November 2019.

Tenders for access rights in the South West REZ may be granted up to the initial aggregate maximum capacity cap of 3.98 GW to potentially unlock the ability to generate enough electricity to power more than 1.9 million households.

NSW Energy Minister Penny Sharpe said opening the tender for long-duration storage projects and access to a second renewable energy zone are milestones in the delivery of the state’s Electricity Infrastructure Roadmap.

“They will deliver projects that ensure NSW has enough renewable energy generation and storage when coal-fired power stations retire, and give certainty to investors and communities,” she said.

“Long-duration storage is a key part of our future energy system, ensuring we have power when we need it and opening of the second access rights process will ensure the right combination of projects can connect to the grid in a way that delivers for NSW electricity consumers and host communities.”

Registration to bid in the tender closes on 7 June 2024, project bidding on 27 June, and financial value bids in late September, with unsuccessful proponents advised in December and selected bids soon after, possibly into January 2025.

The announcement is the fifth tender rolled out under the NSW Electricity Infrastructure Roadmap, and the third for long-duration storage. It is open to projects connecting to new planned infrastructure in Renewable Energy Zones with access schemes, or existing infrastructure state-wide.

Projects will also be assessed on their contribution towards and engagement with communities, and those awarded rights will pay fees to fund community benefit and employment programs in the region.

The NSW Electricity Infrastructure Roadmap was created to support private investment in renewable energy projects and deliver at least 12 GW of renewable energy generation and 2 GW of long-duration storage by 2030. It also sets the pathway for establishing five renewable energy zones to replace retiring coal-fired power stations.

The South West REZ is expected to receive up to $2.8 billion in private investment by 2030 and achieve an intended network capacity of 2.5 GW delivered by the eastern section of Project EnergyConnect, HumeLink and the NSW-side of the Victoria to NSW Interconnector (VNI) West, and minor additional REZ network infrastructure.

From pv magazine Australia