French renewable and battery storage developer Neoen says it expects its heavily delayed Bulgana wind and battery hub in western Victoria to be in full production by the end of the year.
The Bulgana Green Energy Hub features a 194MW wind farm supported by a 20MW/34MWh Tesla battery, and was expected to come into full production in mid-2020, but fell victim to the widespread commissioning delays that have affected many wind and solar projects.
It has been operating at restricted output but late last month finally got its registration for the project’s full capacity and expects to be able to ramp up to full operation by the end of the year.
“It’s now on the right track,” Neoen CEO Xavier Barbaro told analysts in a briefing accompanying its annual results on Friday.
“We are one or two months behind what we would have hoped in March. We now know where we will land. It’s not the best scenario, but it is still good enough.”
Barbaro says Bulgana will be able to lift its output to 150MW in August, which it says will allow it to deliver 90 per cent of its anticipated generation, moving moving to its full capacity of more than 200MW in the December quarter.
Neoen still has an underwriting agreement from the Victoria government for most of the output of the wind farm and is looking for another commercial off-taker for the remainder.
Bulgana battery. Source: Neoen.
The delays at Bulgana were one of the two main causes for Neoen to trip back the top end of its anticipated profit range (EBITDA) for calendar 2021, to between €295 million and €310 million, down from the range of €295 million and €325 million previously expected.
Its first-half 2021 EBITDA fell 15 per cent to €125.9 million, mostly reflecting the windfall profits it made from the Hornsdale Power Reserve battery in South Australia early last year when tornadoes tore down the main transmission link to Victoria, and big liquidated damages receipts from projects in the US.
Solar EBITDA declined 17% as a result of the high base of comparison in the first six months of 2020 when Neoen recognized liquidated damages in the US, while wind EBITDA was 17% higher thanks to new capacity in production, including the first generation from Bulgana.
Storage EBITDA totaled €11.1 million, less than half the €23.2 million in the first six months of 2020 when Hornsdale pocketed the windfall, but the latest earnings also included income from the expanded facility which is now delivering “synthetic inertia” and operating as a “virtual synchronous machine.”
Neoen has been one of the most successful developers in Australia, having built the original Tesla big battery in South Australia, and now also working on the country’s biggest solar project in Queensland at Western Downs.
It has 2.7GW in operation but expects to lift this to nearly 5GW by year end, and to 10GW by the end of 2025.
Projects in Australia include the Victoria Big Battery, the biggest in Australia (which was hit by a fire on Friday morning that was still burning on Sunday), the Western Downs solar project, the 157MW Kaban wind farm in Queensland and the first 110MW stage of the Goyder South wind, solar and battery project in South Australia.
