Thursday, September 29, 2022

US investment giant BlackRock makes $1 billion battery in Australia and acquires Melbourne startup Akaysha Energy

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US investment firm BlackRock is acquiring local battery storage developer Akaysha Energy as part of a deal to spend A$1 billion on developing 1GW (Gigawatt) of storage for the National Electricity Market (NEM) in Australia.

For perspective, that’s more than the power produced by Australia’s largest coal-fired power station, Origin Energy’s Eraring plant (2,880 MW), which is expected to close in 2025.

It is the first battery storage investment made by BlackRock’s Climate Infrastructure business – part of BlackRock Real Assets – in the Asia-Pacific region.

The deal was approved by the Foreign Investment Review Board last week. The acquisition price has not been disclosed.

Founded in 2021, Melbourne-based Akaysha has nine battery storage projects underway across Australia, including 150 MW Ulinda Park in Queensland with a 2-hour maximum discharge capacity; the Orana BESS, near Wellington in central west NSW, which will have a capacity of between 200-400MW and provide up to 8 hours or 1600MWh of energy storage; and Palmerston in Tasmania.

An Akaysha Energy battery storage system.

The first-to-market Ulinda Park will cost approximately $150 million and the required capital is to be committed early next year.

At full capacity, the projects will help accelerate the rollout of an additional 4,000 MW (megawatts) of renewable energy across Australia.

BlackRock said the investment will support the network at a critical time in Australia’s energy transition and is expected to reduce more than 15 million tonnes of CO2 equivalent emissions over the lifetime of the projects.

Akaysha Energy also has longer term plans, including developing future energy storage projects in other APAC markets, starting with Japan and Taiwan.

MD Nick Carter said the region is at the beginning of its energy transition and large-scale battery storage will be critical to its success.

“By leveraging BlackRock’s global capabilities and track record in climate infrastructure, we are excited to deliver on our ambitions by accelerating the deployment of utility-scale energy storage technologies that will reduce the variability of renewable generation and improve grid reliability and resilience for the electricity system. networks in Asia-Pacific,” he said.

BlackRock’s APAC Co-Head of Climate Infrastructure Charlie Reid, said the company sees “huge long-term growth potential” for battery storage assets in Australia and other markets in Asia-Pacific.

“As Australia’s renewable energy infrastructure continues to mature, investments in battery storage assets are needed to ensure grid resilience and reliability, especially with the ongoing earlier-than-expected retirement of coal-fired power plants,” he said.

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