South Australia taps new gas plant, batteries to fix power crisis

The South Australian Government has announced A$550 million energy plan to build a battery to restore renewable energy and a gas-fired power plant to ensure energy security.

The six-point plan, unveiled by Premier Jay Weatherill and Energy Minister Tom Koutsantonis, includes building a new $360 million, 250 megawatt gas-fired power plant and Australia’s largest battery.

The plan also includes A$150 million to encourage the development of a 100 megawatts of battery storage, possibly from Elon Musk or from local providers.

The South Australia government came up with the emergency plan after a state-wide blackout last September during a storm that left homes and businesses in the dark for up to eight hours and paralyzed industries for up to two weeks.

“Today, South Australia takes hold of its energy future. We have a national electricity market which is failing not only South Australia but failing the nation,” Premier Jay Weatherill said in a statement.

Federal Resources Minister Josh Frydenberg is agitated that South Australia has gone solo and wants to “rip up” a national agreement after a national electricity market was established 20 years ago.

The South Australian Premier however said the state could no longer rely on the electricity interconnector with eastern Australia.

South Australian Premier Jay Weatherill MP (right) and Energy Minister Tom Koutsantonis.

South Australian Premier Jay Weatherill MP (right) and Energy Minister Tom Koutsantonis.

Mr Weatherill said the citizens of SA wanted the Government to step up where the market has failed. But now they have come up with their own energy plan.

“It is a plan for the 21st century. It is a plan to take our clean, green, renewable resources and use them to create an energy future for our state and indeed for our nation.”

South Australia’s last coal-fired power station shut down last May.

On the batteries front, Weatherill said he was speaking to a range of providers. “We want as much local content as possible,” he told a news conference. “We also need to put in the balance the reputational effect of attracting an international player of the size of Elon Musk to South Australia. “

Weatherill spoke to Musk on Saturday after Australian tech entrepreneur Mike Cannon-Brookes said he would help raise funding and political support for the Tesla chief’s offer to supply 100 megawatt-hours of batteries for $25 million within 100 days of signing a contract, or provide it free.

The six-point plan, entitled South Australian Power for South Australians, encompasses:

  • Building of the largest grid-connected battery in Australia to store energy, funded by a new renewable technology fund
  • Construction of a government-owned 250MW gas-fired power plant to provide emergency back-up power and system stability services for South Australia
  • Introduction of new ministerial powers to direct the market to operate in the interests of South Australians
  • Incentivisation of increased gas production to ensure more of the state’s gas is sourced and used in South Australia
  • Creation of an energy security target to require a proportion of power used within South Australia to be generated within the state.