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Two battery storage projects for Western Victoria

MinterEllison has advised Victoria’s Department of Environment, Land, Water and Planning (DELWP) on its Energy Storing Initiative (ESI) – a funding program that will deliver two large-scale battery storage projects for grid constrained areas in Western Victoria.

The projects have the objectives of improving the performance and reliability capability of Victoria’s energy infrastructure, and enabling delivery of sustainable and affordable energy to Victorian consumers over the long term.

One of the batteries, a Tesla 25MW/50MWh, will be integrated with the Gannawarra Solar Farm – south-west of Kerang. The second battery is a 30MW/30MWh system connected directly to a vital grid intersection at a substation at Warrenheip, near Ballarat.

The two projects are being delivered by private consortia Edify Energy and Spotless Sustainability Services, with $25 million from the Labor Government and matched funding from the Australian Renewable Energy Agency (ARENA).

To date, MinterEllison has assisted DELWP to navigate through the complex and dynamic energy regulatory landscape for uptake of innovative energy storage technologies at the national and Victorian jurisdictional level.

The firm has also advised DELWP in relation to bidder consortium arrangements with network service providers, the Australian Energy Market Operator, the Australian Energy Regulator and the Victorian Essential Services Commission.

“This is a first of its kind project in Victoria, with many unique challenges and opportunities for our team and the Department,” said MinterEllison partner Kylie Diwell. “The successful implementation of the program has really required our strong energy regulatory expertise and our comprehensive understanding of the Government’s unique operating environment, namely the impacts of policy, probity, commercial and political considerations and drivers on government operations.”

MinterEllison has worked alongside DELWP to facilitate parallel negotiations between DELWP, ARENA and each of the bidder consortiums in relation to the primary funding agreement and associated contractual arrangements.

“We’ve helped to bring together key resources to manage multiple workstreams in a highly time-pressured environment, including working collaboratively with ARENA as a co-funder,” said Diwell. “It’s been a great experience working with the Department’s team as they harness the great potential of battery technologies to move Victoria to a more reliable and clean energy system.”

Construction on the projects has begun, with both expected to be operational in time for next summer’s peak. Both projects were able to achieve Project Financial Close prior to the end of March 2018.

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