Batteries could be the end of Origins Eraring Coal fired Power station. Following the announcement of Origin Energy’s $2.3 billion loss for the last financial year, Origin have announced they are close to “pulling the trigger” on its first big battery storage projects. Until now Origin has not embraced new technologies and focused on its existing coal and gas fleet of generators.
Origin CEO Frank Calabria said that it has several big battery storage projects in the pipeline, including at the site of the Eraring coal generator in NSW.
Origin has previously flagged plans for a 700MW battery co-located at the site of its Eraring coal fired power station in the Hunter region but now they say they are very close to “pulling the trigger” on the project. The battery is likely to co-locate at the site with the existing units closing by 2032 leading to further opportunities to expand the battery capabilities. Origin CEO said, “It’s just all timeliness right now, and we’ve got a number of sites ready to go,”.
Origin is also looking at a 300MW solar and battery storage facility in South Australia and is also looking at a big battery next to its Mortlake power station in Victoria.
Eraring coal-fired power station remains a challenge to Origin with its 2,880MW of generation exposed to the wholesale market until its retirement ear market for 2030. With the influx of cheaper renewable generation like wind and solar eroding value in the power station.
Along with other coal fired generators, Eraring is looking to increase the flexibility of the units to limit operation during low spot price periods when electricity prices are below its cost of production.
Eraring will be a major beneficiary of the schemes being proposed by the Energy Security Board (ESB).
Origin said that it would take advantage of the disallowed three-year window during which it could delay the surrender of Large-scale Generation Certificates under the federal RET, this will improve Origins financial position by up the $50M. This loophole will allow Origin to save on environmental purchases as the certificates are expected to fall significantly over the coming years.
Origins $2.3B loss is similar to AGLs $2B loss announced the week before. We are definitely seeing a major change in the energy market as it transitions towards renewables and storage, and away from coal and gas.