Eraring battery to be built in two stages, as Origin targets 2GW virtual power plant
This article was originally posted by Renew Economy Australia on 9th March 2022.Origin Energy says it will build the massive Eraring battery over two stages, and is also aiming to grow its in-house “virtual power plant” to 2GW or more to provide a “very low cost” replacement for the country’s biggest coal generator.
The plans were outlined in Origin’s “Strategy Refresh” presentation to investors and analysts on Wednesday as it looks to a future beyond coal after fast tracking the closure of the Eraring coal plant to 2025 from 2032.
Two key announcements were made. The first was the decision to build the planned 700MW Eraring battery over two stages, the first to be a 460MW and 920MWh installation, and the second to be another 240MW.
The second key announcement was Origin’s plan to grow its “in-house” virtual power plant (VPP) from around 200MW to 2,000MW, which CEO Frank Calabria says could be achieved over the next four years.
Calabria says VPPs – basically rooftop solar, battery storage and demand management resources, along with pool pumps and electric vehicles installed in its customer base – could deliver “very low cost” replacement capacity to Eraring.
“A VPP is a capital and cost-efficient tool to create capacity,” Origin’s presentation said. “VPP assets tend to have very low or even zero upfront capital cost to establish.”
Calabria said VPP assets are just like a peaking power plant, and part of its value is its ability to avoid the cost of hedging contracts, one of the most expensive products in the electricity market.
