Bulgana big battery switches on, but its biggest customer has collapsed

The Bulgana big battery in Victoria has become the third utility big battery storage project to switch on in the state – and the sixth in Australia’s main grid – but the project appears to have lost its major corporate customer.

The 20MW/34MWh battery is located next door to the 194MW Bulgana wind farm at what is known as the Bulgana Green Power Hub. When it was first unveiled in 2017, the bold plan was for a $560 million project to deliver 100 per cent renewable energy to what would be the country’s biggest vegetable greenhouse.

However, the main proponent of that 40 hectare greenhouse near Stawell in western Victoria, Nectar Farms, has been placed in liquidation – it’s now in the hands of Julian Lam from SV Partners – so it seems that part of the project is now dead in the water.

The Bulgana Green Power Hub is developed and owned by French company Neoen, which also owns the original Tesla big battery, aka the Hornsdale Power Reserve, and is also building the Victoria Big Battery near Geelong, which will be the biggest in the country at 300MW/450MWh.

The Bulgana battery also uses Tesla technology, but the facility was caught up in the connection delays that have badly affected projects in western Victoria. To help relieve those problems, AusNet is proposing to build a new transmission line from Bulgana through to Melbourne.

The Bulgana wind farm first started injecting into the grid early last year, but only at small amounts and only recently gained its full registration following the decision by the Australian Energy Market Operator to connect projects in that part of the grid one by one.

Its first injections into the grid, and charging, can be seen in the graph below provided by Global Roam.

The connection delays caused Neoen to first seek liquidated damages from its main contractor, but this was not enough to protect itself from a financial hit from the loss of revenues.

Its operation has also been complicated by the rules of the National Electricity Market, which requires wind farms and batteries, even when located at the same place, to be separately registered and separately dispatched. The market rule maker has finally proposed an update to those rules.

The greenhouse was due to take around 15 per cent of the output of the wind farm, but the project also has a 15-year off-take agreement with the Victoria government for most of the output. The strike price has not been revealed.

The contract with Nectar Farms was described as a deal maker at the time because of the lower price that the combination of wind and battery storage offered compared to gas, along with the electrification of the greenhouse facility.

Northern Grampians Shire mayor Murray Emerson says he is disappointed by the collapse of Nectar Farms, and the local council was now looking for other businesses to seize the opportunity.

“As a council we’ve spent seven years helping guide the company with everything such as planning applications, buying land, you name it. We’ve pretty well assisted them from the start,” he told the local paper, the Weekly Advertiser, last month.

“What we know is that there is a very valuable commodity out there called a wind farm, there was an attractive arrangement involving a value-adding business and the government involving directly accessing power,” he said.

“We now need to look at that and see if any other business would like to get involved.

“It is a much more advanced landscape regarding renewable energy and opportunities for behind-the-meter projects than it was seven years ago.

“It’s a hell of an opportunity and there is a bit of work to be done. But you never know, when one door closes, another can open.”

Louis de Sambucy, the head of Neoen Australia, said in a statement:

“We are pleased to confirm that the Bulgana Green Power Hub (194MW wind farm and 20MW battery) has been registered in full.

“We are now working through the final phases of the commissioning process with full operations expected in the coming weeks. We’d like to thank the team at AEMO for their hard work in reaching these milestones.

“90% of the energy from the Bulgana Green Power Hub is contracted with the Victorian Government. Although the Nectar Farms news is disappointing, we are actively exploring alternatives with corporate customers that would be keen to benefit from this opportunity while delivering investment and jobs in regional Victoria.”

See also RenewEconomy’s Big Battery Storage Map of Australia and its Large Scale Wind Farm Map of Australia.