NSW Government Launches Tender for New Big Battery to Replace Eraring Coal Generator

The New South Wales government has launched a new tender for a big battery that will replace the capacity lost when Eraring, the country's biggest coal generator, closes in 2025. The tender is officially for firming capacity of at least 380MW and two hours storage. It is open to different technologies, including gas peaking stations and hydrogen electrolysers, but battery storage is likely the best bet for this mandate.

The Second Tender of 20 Being Conducted by NSW Government

The NSW government is conducting around 20 tenders as part of its renewable infrastructure roadmap to replace the five big coal generators that will likely close in the next decade. This tender is unique as it seeks firming capacity that is not long-term storage and is designed to fill the gap from the closure of the 2.8GW Eraring.

Delayed Closure of Eraring Units?

AEMO's recent Electricity Statement of Opportunities identified a potential breach of the reliability standard, but it stipulated that this forecast was based only on the assumption that planned tenders like this one did not go ahead. The closure of the last of the four 720MW generating units at Eraring may have to be delayed beyond the proposed August 2025 closure date if not enough replacement capacity is built.

Winner Likely to be Battery Storage Project

The likely winner will be a battery storage project that is already under development and has secured a connection approval. The battery will be locked into a year-long contract that will require it to ensure it is available "for at least 90% throughout the year" and able to respond to an actual lack of reserve condition (LOR) 3 event. Demand response proposals will also need to respond to an actual LOR 1, 2 and 3 event with a defined minimum bid.

Tender Timeline

The tender officially opens on April 3 and will close on May 18. Financial offers will be requested in June, and due in July, with a winner to be revealed in September. The project must be complete by December 1, 2025, in time for the summer peak.

The NSW government has already commissioned one big battery, the Waratah Super Battery, which will be the most powerful in the southern hemisphere. This new battery will play a crucial role in securing the state's energy supply and transitioning to renewable energy.