AGL, Australia’s biggest coal generator, has snapped up a newly approved solar thermal project in South Australia, adding to its options for long duration storage and marking a landmark moment for the innovative Australian technology.
The company announced on Wednesday that it had bought the Yadnarie solar and long duration energy storage project, near the town of Cleve on the Eyre Peninsula in South Australia, from Photon Energy.
The Yadnarie project, potentially sized at 150 MW of solar capacity, 90 MW of thermal energy capacity and 720 MWh (8-hours) of energy storage, has recently won state planning approval, and has long been expected to the first big project to be built following the success of the technology at a pilot plant at Carwarp in Victoria.
The technology has been developed by Australian innovator RayGen, in which both AGL and Photon are shareholders. But AGL, unlike the European-based Photon, has deep pockets and the funds to build the project, although the company still insists it is just one of a number of technology options on the table.
“This project incorporates RayGen’s innovative solar-and-storage system technology as one potential solution to the need for long duration energy storage,” says Travis Hughes, the head of power development at AGL.
“AGL has long been an early supporter and adopter of innovative energy solutions like RayGen’s, and this development has the potential to be a reliable and affordable solution to the challenges of long duration energy storage as Australia transitions to a renewable energy system.”
The location of the Yadnarie project in South Australia is significant, given that the state already sources 75 per cent of its annual electricity demand from wind and solar – a world record – and aims to be the first major grid to reach 100 per cent net renewables (wind and solar) by 2027, although it is short of long duration storage options.
AGL remains the dominant player in the South Australian wholesale market, courtesy of its control of asses such as the Torrens Island gas generators, and has built one big battery (at Torrens Island), and controls another at Dalrymple North.
The RayGen system – which the company has been developing since 2010 – uses mirrors to concentrate sunlight onto Australian-made, highly efficient solar modules. In addition to producing electricity, heat is captured from the modules and stored in water reservoirs for on-demand electricity dispatch.
The Carwarp plant – opened in 2023 – is rated at just 4 MW of solar capacity and 50 MWh of storage, but has been valuable in proving the technology and providing information on how to lower costs further to make it competitive with other technology options.
“Yadnarie is a groundbreaking project and will be the first utility-scale deployment of our technology,” RayGen CEO Richard Payne said in a statement.
“(AGL’s) extensive energy market operations and deep appreciation of our technology’s unique capabilities mean they are ideally placed to steward the project through the next phase.”
Solar thermal has held promise for a decade or more, and several large scale projects have been built in Spain, Chile, the US and the Middle East, but it has failed to progress because it has been largely sidelined by the plunging cost of solar PV.
The technology now has a new window of opportunity because of the value placed on long duration storage in high renewable grids, although now it must also contend with the falling price of battery storage technology.
Payne says the Carwarp facility has attracted interest from a number of major global energy players.
It recently completed a $127 million series D capital raise, led by global technology company SLB, and attracting new investors including infrastructure project company Quanta Services, Oxy Technology Ventures and Breakthrough Victoria.
Its other investors include global energy giants such as Norway’s Equinor Ventures, Chevron Technology Ventures, and the Australian Renewable Energy Agency.
Last year, the company opened Australia’s largest renewable energy manufacturing facility, a 170MW per annum solar module production line in Melbourne.
Payne is hopeful a final investment decision can be made soon following the development approval and the AGL purchase of the Yadnarie project.
Yadnarie will feature three 30 MW turbines, each fed by 50 MW solar arrays, based around the same 1 MW solar tower modules that have been deployed at Carwarp. The solar can be fed directly into the grid, or to heat the water which is then used to power conventional Organic Rankine Cycle turbines.
Payne says the technology also supports the grid because it can provide inertia and synchronous generation.
“Traditional CSP (concentrated solar power) technologies use those very large towers and molten salt,” Payne told Renew Economy.
“We are not playing in that area. We operate at low temperatures, modular structures, and we can produce electricity directly from tower. The hot water is a by-product, and that makes us very different from traditional CSP.”
A Knowledge Sharing report filed with ARENA last year said the technology is already cost competitive at a “fraction of the deployed volume with alternatives like lithium batteries and pumped hydro with 12 hours of storage.”
Payne says the Yadnarie project will enable the technology to be replicated at large scale elsewhere, including in South Africa where Photon is pursuing a project. “We will come down further in costs as our projects are rolled out,” he said.
