Plans to pilot an innovative all-Australian made hydrogen hybrid battery storage solution across tens of sub-5MW solar farms across regional Victoria and NSW have been underwritten by the Commonwealth Bank.
Green investment firm Providence Asset Group said on Thursday that it had signed a $33 million project finance agreement with the CBA to bankroll 10 operational solar farms in regional Victoria, each of which will be fitted with a Lavo Heos green hydrogen energy storage and production unit.
Providence, or PAG, is also developing a further 29 solar projects in New South Wales, bringing the total portfolio to 40 sub 5MW solar farms across regional Victoria and New South Wales, all with a Lavo storage system.
Providence said this week that it aims to trial the first deployment of the pioneering hydrogen storage solution at solar farm in Stanhope, Victoria, as early as Q4 2021, and then to deploy them progressively across the portfolio over the course of 2023-2024.
As RenewEconomy reported in October of last year, the Lavo energy storage technology is a spin-off of the Hydrogen Energy Research Centre, co-founded by the University of NSW and Providence, which has been a financial backer of the technology.
Lavo describes its hydrogen battery as “a solar sponge” that uses patented hydride to store hydrogen in metal alloy, thus enabling the “world’s first, long-term capture, hydrogen battery within a secure vessel.”
The company, which has also targeted homes and businesses for its technology, in January secured a cornerstone investor – ASX-listed investment outfit Gowing Bros – alongside a bulk order for more than 200 of its 40kWh Lavo System units, destined to be paired with commercial solar installations.
Providence’s deal with CBA builds on its July Power Purchase Agreement (PPA) with SmartestEnergy Australia, a subsidiary of Marubeni Corporation, for the output of over 30 community-based solar farms across Victoria and New South Wales.
Under the terms of that agreement, SmartestEnergy will purchase the output of the solar farms for an initial 30-month period, with both parties planning for a 10-year extension on the firming PPA at the end of the initial period.
When all of the solar farms are operating, the combined generation output is forecast to be around 500GWh a year.
For its part in the plans, CBA’s executive director of natural resources and energy, Neil Fraser, said the bank was particularly keen to support the piloting of the UNSW-developed Lavo Heos technology.
“This is a pioneering Australian technology which has the potential to be an important part of the future energy mix required to meet the needs of a net-zero economy,” Fraser said on Thursday.
Providence Asset Group co-founder and CIO Alan Yu said it was particularly gratifying for the company to be makingan investment in Victoria at a time that had been so challenging the state, due to Covid-19.
“Providence Asset Group is proud to be at the forefront of the energy transition in Australia, applying the innovative storage technology of the Lavo Heos with our existing and planned portfolio of regional solar farms,” he said.
“Providence Asset Group recognises the enormous opportunities that exist in our regions and we’re excited to be partnering with regional communities to deliver more affordable and sustainable energy solutions.”