By PHILIP HOPKINS
THE 150 megawatt battery installed by Engie at the old Hazelwood power station site has just had its first birthday – and the company is very happy with its ability to produce electricity when needed and its financial performance.
“It’s done very well; we are very happy with the way it’s going,” said Jonathan Vila, the coordinator of the Hazelwood Battery Energy Storage System, as it’s formally known.
Mr Vila, a mechanical engineer who previously worked in white paper production at Australian Paper’s Maryvale Mill, said one caveat was Victoria’s stable power market compared to South Australia, which has a higher penetration of renewables.
“The volatility is not as accentuated here,” he said, due to the high percentage of Victorian electricity still produced by the Latrobe Valley’s brown coal power stations.
“We also had a poor summer, but overall it performed very well,” he told the Express during a birthday tour of the battery plant last month.
The battery, which takes up a corner of the 4000-hectare Hazelwood mining site, cost about $150 million to build – that’s about $1 million per megawatt hour – and went into operation on December 20, 2023. It is 70 per cent-owned by Engie and 30 per cent by Eku Energy, previously part of the Macquarie Group. The battery has one employee – Mr Vila – but uses many maintenance contractors.
The battery’s role is relatively straightforward: it stores renewable energy when it is plentiful and cheap, and discharges it back to the energy grid when the sun goes down and demand increases.
The Hazelwood battery’s power lasts for about one hour, and like the roughly 30 batteries around Australia, it supports the growth and integration of the energy transition.
Mr Vila, explaining the operation of the battery, said the more renewables that enter the market, the price in the middle of the day will drop lower.
“We discharge at a juicy time in the evening,” he said.
The battery follows a pattern.
“Typically, doing a charge there are two scenarios – we do a charge early morning, 2am-5am, and discharge about 7am when everyone is making breakfast. We wait after midday to start charging (again) to get ready for 4-5pm onwards to discharge at the peak. That changes in summer – we discharge in evening, wait till basically the next midday point, past nine o’clock to charge again,” he said.
“In summer, the morning peak has vanished, there is so much sun kicking in early on, so much in the grid. There is not much to do – so to speak – in the middle of the day, we are finding there are discharges later in the evening because the sun comes off later in evening, often discharging at eight or nine o’clock at night, so the pattern changes depending on the season. Typically, it’s early morning and midday for the charging, and mid-morning and evening for discharge.”
Mr Vila said the biggest role the battery is playing at the moment is frequency management.
“It’s a proud role for us. We capture eight to nine per cent of the market for frequency control. We are a small battery amongst 30 batteries. As a merchant battery, we have no particular contract, we’re free to use all its capacity.”
This made it one of the best performing batteries in Australia, only topped by some in Queensland, he said.
Engie’s figures show that the Hazelwood battery over the past year charged more than 63 Gigawatt hours, which the company said is about the annual electricity consumption of about 9300 average Australian homes, and discharged 46GWh of energy.
“The Hazelwood battery is always on, providing quick adjustments and stability to the Victorian grid frequency,” Mr Vila said.
The battery consists of 342 modular, standardised factory-built cubes built by Fluence, a global specialist in energy storage products and services and digital applications for renewables and storage. Each cube is self-cooling and has built-in safety mechanisms.
“These have a 20-year life, but that depends on how aggressively you use the battery. If the market is stable, then we will not use as many cycles; it may last for 21 years, for example. If the market is very aggressive, that will shorten the life of the battery. The expectations are it will last 20 years,” he said.
“It runs well; most of the maintenances is your checks and balances – cooling pressure, cleaning filters, occasional software update – making sure you have latest systems in place, making it more efficient.”
Mr Vila said he expected the frequency market would be the main business area affected in the future.
“Battery revenue will shift to storage and selling. Peak will become the main revenue. With more demand in the middle of the day, there is now less battery demand due to rooftop solar. More batteries will want to charge up during that point in time so that’s where frequency of the grid will not become a problem because there are so many batteries managing at once. It will be more about their role of soaking up the middle of the day sun,” he said.
There are six batteries in Victoria at the moment.
The 800MW Rangebank at Cranbourne, also owned by Eku Energy, opened in December and has just under two hours of capacity. Four or five others are to be built at the old Morwell power station, at Jeerelang gas power station, the Hazelwood North solar farm between Morwell and Traralgon, and another at Tramway Road.
The Hazelwood site is zoned light industrial. With access to what was Hazelwood’s 1600MW power capacity, Engie has the opportunity to optimise the space.
“When you start talking about the future of offshore wind in Victoria, that transmission switchyard starts to become an important asset, located in an energy site. We will be here for 15-20 years when we complete the rehabilitation works. We will become more an asset operator in this site,” Engie’s media spokesman, Ryan Augur said.
“There is lots of talk about future vision, what could ultimately be on this site. We are a power company, not a developer. What we do best is to operate our assets. Our primary focus is to this footprint; over time as rehabilitation works continue, we will put together a strategy of what’s the best use for the rest of the site.”
Could Hazelwood host a nuclear plant?
“Engie operates nuclear power stations in Belgium, but nuclear is not part of our local strategy. If the Libs get in, they may talk to us. We have a bipartisan approach to government, we don’t have any ideological bent on technologies. If they stack up economically, that’s something we could pursue. The key part of our strategy is large-scale wind, solar and batteries, or lesser extent hydrogen,” he said.
At Hazelwood, Engie is developing an expansion of the battery. The Hazelwood Battery 2.0 expansion is being developed as a 150 MW two-hour (300 MWh) design, and it will utilise more of the existing 1600 MW of latent transmission infrastructure at the site to connect with the grid.
Engie, which has operated in Australia since 1996, is also currently developing at least three solar and wind projects in Australia that could include a co-located battery.
