ARENA awards $143 million for community battery projects

The Australian Renewable Energy Agency (ARENA) has conditionally approved the deployment of up to 370 community batteries across Australia under the first round of the Community Battery Funding Program for a total amount of $143 million.

All states and the Northern Territory are expected to benefit from the program, which aims to unlock $359 million in investment in renewable energy infrastructure.

Once operational, the batteries are expected to have a measurable impact on local grid constraints, increase rooftop solar capacity, reduce emissions and lower electricity costs for consumers.

The benefits of these batteries are expected to accrue to households, hospitals, schools and higher education institutions, municipal facilities, housing estates, social and community housing, sports facilities, libraries, aquatic centers, shopping centers and regional and remote communities.

ARENA CEO Darren Miller said community batteries will increase energy resilience, reliability and sustainability while reducing energy costs for consumers and businesses.

“ARENA is pleased to support the deployment of these batteries through our transformational program, which will have a significant impact on Australia’s energy and network security, while delivering cleaner, more cost-effective energy to our communities. We are excited to see this important asset class being demonstrated at this scale and expect this funding round to kick-start the storage sector at a neighbourhood scale.”

The 2022–23 Federal Budget allocated $200 million for the Community Batteries for Household Solar Budget Measure to deploy 400 community batteries across Australia. Of this, $171 million was allocated to ARENA to deliver at least 342 batteries, with the remainder provided by the Department of Climate Change, Energy, Environment and Water (DCCEEW).

ARENA received a strong response in the first round, with 140 eligible Expressions of Interest. Funding was conditionally awarded to 21 applications from 20 applicants; ten applications for $67.3 million under Stream A Distribution Network Service Providers (DNSPs) and eleven applications for $75.7 million under Stream B Non-DNSPs.

The batteries will have a combined storage capacity of up to 281 MWh, enabling the storage and use of renewable energy generated in Australian communities. ARENA will provide subsidies of up to $0.51/Wh at an average cost of $1.28/Wh (39.8 per cent).

Specific locations for the batteries have not yet been determined and are subject to public consultations, plan approvals and conclusion of commercial agreements. All ARENA funding is contingent upon the finalization of funding agreements with each successful applicant.

ARENA expects to launch its second round of battery crowdfunding in late 2024, with an allocation of at least $28 million.

Recipients:

Stream A (DNSP)

• Ausgrid (NSW)
• Endeavour Energy (New South Wales)
• Energex (2 applications, QLD)
• Ergon Energy (QLD)
• Horizon Power (WA)
• Power and Water Corporation (NT)
• Electricity networks SA (SA)
• Tasmanian Networks (TAS)
• Western Power (WA)

Stream B (non-DNSP)

• Department of Energy and Mining (SA)
• Enel X Australia (Multiple States)
• FRV Services Australia (VIC)
• Indigo Power (Multiple States)
• Gemlife (multiple states)
• Hydro Tasmania (multiple states)
• Mondo Power (Victoria)
• Next Green Group (Multi-State)
• Shell Energy Retail (NSW)
• Transport for New South Wales (NSW)
• ZEN Energy Retail (NSW)

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