Neoen 300MW Victorian Big Battery (VBB), which will be built using Tesla's latest Megapack product, has received a $160 million investment from Clean Energy Finance Corporation (CEFC). The goal of the VBB construction is to significantly improve the state’s grid security while driving down power prices and supporting more renewable energy.
The CEFC senior debt facility will finance design, build, and operate VBB, which will become one of the largest energy storage facilities in the world. It is expected to be operational for the 2021-22 summer. The investment delivers on the CEFC strategic focus on energy storage as a priority technology under the Technology Investment Roadmap.
The 300/450 MWh VBB will be built near Geelong and will play a critical role in the local grid, serving as a pillar that could significantly increase the capacity of the main link between Victoria and NSW during peak hours.
Neoen has already secured a $12.5 million per year contract to provide this service to the Australian energy market operator, and has now received $160 million in debt financing from CEFC.
Victorian Big Battery has reached financial close 3 months after signing a contract with @AEMO_Media thanks to @CEFCAus financing and support 👏👏— Neoen Australia (@NEOEN_AU) February 24, 2021
Construction of Australia's largest battery is underway with partners @Tesla & @AusNetServices already hard at work 🦺Go team ! pic.twitter.com/6wvP6oIGl9
CEFC CEO Ian Learmonth said: “Energy storage supports cost effective, reliable, clean electricity and is a key component of Australia’s transition to a low emissions economy. This project is a world-class example of how utility-scale batteries can help electricity networks support a higher penetration of renewable energy.
Neoen, one of the world's leading independent producers of purely renewable energy, will own and operate VBB, which will be powered by Tesla Megapack batteries, an incredibly popular energy storage solution.
Under the System Integrity Protection Scheme (SIPS) contract Neoen has signed with AEMO, the VBB will unlock up to an additional 250 MW of peak capacity on the existing Victoria to New South Wales Interconnector. An independent analysis by PWC 1 showed that the SIPS process could bring Victorian consumers a combined benefit of over $220 million over the next 11 years, including savings on energy bills.
Neoen Australia Managing Director Louis de Sambucy said: “We are delighted to announce that the Victorian Big Battery has reached this important financial milestone. I would like to thank the CEFC for their renewed trust and commitment towards supporting innovative storage solutions. With the help and hard work of our partners, Tesla and AusNet Services, we are on track to deliver this project before the next Australian summer and are looking forward to playing our part in helping Victoria reach its ambitious target of 50% renewable energy by 2030."
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.