The nenewable energy market in the Asia Pacific region is to boom with utility-scale batteries replacing expensive power grids.
In a strategic move, Japan’s JERA, is set to collaborate with a U.S.-German joint venture along with an Australian firm in order to develop battery projects in the Asia-Pacific region.
The move targets a market expected to be worth several billion dollars by 2022.
The move marks a big green push for JERA, a joint venture between Tokyo Electric Power Co and Chubu Electric Power Co, one of the world’s biggest buyers of liquefied natural gas (LNG) and one of the world’s biggest coal traders.
The idea is for JERA to fund energy storage projects with Australia’s Lyon Group, a renewable power developer, while Germany’s Siemens AG provides the necessary battery technology.
At the onset, the joint collaboration will focus on building batteries for three solar farms and is expected to cost up to $1.1 billion (A$1.5 billion).
As per estimates from Fluence and others, the global demand for utility-scale batteries is expected to surge to 28GW, up from 2GW committed by electricity providers in 2017 and worth more than $15 billion by 2022.
The batteries will play the crucial role of maintaining grid stability by balancing supply and demand; the potential is significant since it can eliminate the need for expensive power plants.
As per Fluence, there are big opportunities in India, South Korea, Japan, and even China; for the moment it sees Australia as the fastest growing country in the region since it is experiencing soaring power prices with an ageing grid.
“That market has huge potential to grow very, very quickly,” said Mark Leslie, director of Asia Pacific at Fluence.
Incidentally, Lyon’s Riverland project in South Australia would be the world’s biggest battery, with 400 megawatt hours (MWh) of storage, eclipsing even Tesla’s 129 MWh battery in South Australia, which is currently the world’s biggest battery.
Construction is expected to begin on all three projects within months, said Lyon.
Riverland and the Nowingi project in the state of Victoria need offers to connect to the grid before construction can begin.
A smaller project, Cape York, in the state of Queensland already has development approval and an offer to connect to the grid.
“There are many markets beyond Australia where big batteries can provide substantial value in terms of network strength and dispatchable capacity,” said David Green, Lyon Group’s Chairman in a statement.
($1 = 1.3221 Australian dollars)