Early Thursday morning, Origin Energy [ASX:ORG] announced it has made a final investment decision (FID) on the first stage of large-scale battery production at the Eraring Power Station.
The company shall commit to an investment of around $600 million and intends for construction and supplies for the battery can begin in the next few weeks.
Frank Calabria, Origin’s CEO, said that the approval for the Eraring battery ‘is an important milestone for Origin and another significant step in our strategy to lead the energy transition’.
ORG has really picked up since the end of last year, having improved its share price value by more than 24% in the past full year, and more than 7% over the past three months.
Trading at $8.29 at the time of writing, Origin’s stock had a lead on the wider market average by around 27% on a 12-month rolling average:
www.TradingView.com
Origin’s FID for construction of large-scale Eraring battery
The energy company announced this morning that it will be devoting $600 million to first stage development of a large-scale battery at the Eraring Power Station.
Eraring is Australia’s largest power station, supplying around a quarter of NSW’s energy and is Origin’s only coal-fired generator.
Agreements have already been executed for the supply and construction of the battery, and the company has said that works are to commence within a matter of weeks.
Stage one of the battery project will include the construction of a 460-megawatt battery storage system with a dispatch duration of two hours.
Origin has expressed that it also has the option to increase the battery to 700 megawatts, with a four-hour dispatch period.
The company said the batteries are set to come online by Q4 2025.
Mr Calabria commented:
‘We are pleased to make this significant capital investment in Origin’s first major battery project to support the growth in renewable energy that’s occurring across the NEM, together with the expansion of our own portfolio of renewable energy developments.’
Origin’s head of energy supply and operations, Greg Jarvis, added:
‘Eraring is a strategic site with high quality connection infrastructure enabling us to deliver energy into major demand centres. Development of the Eraring battery is a key next step as we look to transform the Eraring site for the future, given our intention to exit coal-fired generation by as early as August 2025.
‘We are grateful for the strong support Origin has received from the local community and other stakeholders, and we look forward to working with our key contractors to deliver the Eraring battery safely and expeditiously, consistent with the conditions of approval granted by the NSW Government.’
Full planning approval for the Eraring battery project was given by the NSW Department of Planning and Environment in May last year.
Finnish technology group Wärtsilä are to supply the battery equipment, and Enerven (a subsidiary of SA Power Networks Group), will oversee design and construction.
Origin has also expressed intent to place the Eraring coal-fired power station into ‘early retirement’, which could be scheduled within the next three-and-a-half to four years.
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Mahlia Stewart
For Money Morning
