Renewables boss shocked by plunging price of battery storage, and soaring cost of a concrete slab

The head of one of Australia’s biggest renewable energy developers says he is “flabbergasted” by the extent of the cost falls in battery storage, but equally shocked by the rising cost of laying a concrete slab – a key component of both wind and big battery projects.

Tilt Renewables is currently building its first big battery in the Latrobe Valley in Victoria and CEO Anthony Fowler says he has been taken aback by the falling price of battery cells and modules.

“I’m a bit flabbergasted by the price, what we were seeing a few years ago it is now around half of that,” Fowler says in an interview in the latest episode of Renew Economy’s Energy Insiders podcast.

Which is good, but Fowler says that balance-of-plant costs are also rising. Other developers have also pointed to the rising costs of civil construction, and of labour, but Fowler says it is a significant issue for renewable and storage development in Australia, and for consumers.

“Frankly, when you look at the balance-of-plant costs that you do see for constructing anything, I’m often shocked. I just can’t believe it costs so much to lay a slab of concrete.

“And we hear this from … the big turbine producers … the big network equipment producers, that Australia is the most expensive place in the world that they see to build things, and I think it’s a big problem.

“I really look forward to working with the industry and government to work out what we can do to bring those costs down. Because, as we all know, the consumer is picking up the tab for all of this, and if costs keep track in the way that they are, our industry is just not going to receive widespread support for the fun work that we do.”

Tilt Renewables is building the 100 MW/200 MWh Latrobe Valley battery next to the Morwell sub station, marking the second big battery built in the heart of Victoria’s brown coal industry after the Hazelwood battery near the shuttered coal plant of the same name.

Fowler says the costs of battery storage have come down so far that the company has even thought of extending the storage duration out by at least another hour – so adding another 100 MWh or so.

Fowler says the company is considering some other battery projects in South Australia, starting with the already operating Snowtown wind farm, and has filed development applications for two other batteries in the state with up to eight hours of storage – although he suggests they are more likely to be two to four hours duration.

Tilt also owns the Nyngan and Broken Hill solar farms, among the first to be built in Australia’s main grid, and is looking at opportunities to add batteries to those projects. He says standalone solar projects are not the company’s priority now.

It’s focus is on wind, and it now has the green light to go ahead with the first “gigascale” wind project in NSW, the 1.33 GW Liverpool Plains wind project that recently got planning approval and which has now gained access rights to the grid in the new Central West Orana renewable energy zone.

Tilt also won an underwriting agreement in the federal government’s Capacity Investment Scheme for the 288 MW Palmer wind project in South Australia, has near term plans for the 100 MW Waddi wind project in Western Australia, and is also looking to develop the 1.2 GW Nonowie wind project in South Australia.

“I think every time I see a price come across my table for anything connected to a wind farm at the moment, it seems to be, certainly cheaper than what it was two years ago, very likely cheaper than what it was a year ago,” Fowler says.

“And I think these days we’re thinking $3 million a megawatt (capital cost), maybe more, depending on the style of the project.

“And there just doesn’t seem to be any downward pressure on that at the moment. I know that’s a little bit different to solar. It’s certainly very, very different to batteries. But that’s what we’re seeing in the wind space at the moment.”

Fowler says that one of the big ticket items under the new federal government will be issue of environmental and planning approvals. He says it is getting harder, and transmission issues remain.

“I think we would all agree that if … we’re in a regime where it takes five, seven, 10, years to get things built, we’re not going to hit the 82% renewable energy target.

“And I just strongly encourage everybody to really lean into all of this, all the connection processes, all the environmental, all the planning processes, we’ve got to do what we can as quickly and efficiently as we can.

“Because something does need to improve and (timelines to quicken) so that we can get towards that 82% renewable more efficiently.”

You can hear the full interview with Tilt Renewables CEO Anthony Fowler in the latest episode of our Energy Insiders podcast here.

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