The start of operations at Australia’s biggest battery – the 300MW/450MWh – has delivered a near three fold boost in storage revenue in the first quarter of 2022 for Neoen, and contributed to record quarterly sales for the company.
The VBB began operating late last year – on schedule, despite a fire in one of the Tesla MegaPack units – and helped drive storage revenue to €14.0 million ($A21 million) in the first quarter of 2022, up from €5.3 million a year earlier.
This wasn’t a record for storage revenue, which was set in early 2020 (€24 million) when Neoen’s Hornsdale Power Reserve delivered windfall revenue as batteries were called in to keep the grid stable after a series of storm and other events.
But this latest figure will be repeatable.
The VBB’s main source of revenue is from a contract with the Victorian state government and AEMO under the System Integrity Protection Scheme (SIPS), which unlocks peak capacity in the main link between NSW and Victoria during the summer.
That contract is worth $12.5 million a year, or $3.1 million a quarter, and accounts for 250MW/125MWh of its capacity during those times.
Neoen also noted that the VBB earned sales from the provision of network services (FCAS) – it is the biggest non hydro player in the market – and arbitrage revenue, although it didn’t go into details.
The €14 million also includes revenues from its other batteries – Hornsdale and Bulgana in Australia, and also the new Yllikkälä battery in Finland, which expanded its sales of network services to several markets in the quarter and benefited from favourable market conditions.
Elsewhere, Neoen reported that solar revenue grew 31 per cent to €49.6 million in the first quarter, compared to the first quarter of 2021 thanks to new facilities in Argentina and France.
In Australia, revenue from its solar plants – including Colleambally, Nurmukah and others, was boosted by higher market prices, which made up for less favorable irradiation conditions. It did not break down the geographic split.
Wind revenue grew 23 per cent over the first-quarter 2021 level to €45.2 million, mostly due to a big jump in market prices, which boosted the revenue of the recently fully commissioned Bulgana facility in Victoria. Its Hornsdale wind farms are mostly on a fixed contract.
The revenue boost also reflected Bulgana’s progressing from mostly commissioned in early 2021 to fully commissioned in 2022.
Overall, Neoen reported revenue of €109.1 million for the first quarter, an increase of 36 per cent over the same period a year ago. The key factors were the contribution from assets that were commissioned in Argentina, Australia (including VBB and Bulgana) and France in 2021.
