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South Australia has unveiled a $550 million energy plan that includes the nation's biggest battery storage

Wind turbines in Waterloo, South Australia. Photo: Morne de Klerk/Getty Images

South Australian premier Jay Weatherill’s energy plan for the state, released today, will invest $550 million in a range of projects including Australia’s biggest battery storage system, with 100MW capacity, as well as a state-owned 250MW gas-fired generator for emergency backup supply.

“The national energy market is failing South Australia and the nation,” Weatherill says in the introduction of “Our Energy Plan”.

The 28-page Weatherill document comes just days after Elon Musk offered to fix the state’s energy reliability problems with $200 million worth of Tesla batteries to capture and store renewable energy.

The new 250MW gas-fired generator is expected to cost $360 million and the government has set itself the nearly impossible task of having it ready by next summer.

The race to build South Australia’s 100MW battery storage system is already on, with a number of local suppliers throwing their hat into the ring alongside Tesla, including WA’s Carnegie Clean Energy, Lyon Solar and SA’s Zen Energy, which has already put forward plans with Santos for a 100MW dual-fuel power station in the Upper Spencer Gulf region using gas and solar.

The storage plan will be funded via a $150 million South Australia Renewable Energy Technology Fund.

Alongside a focus on renewable energy, the government plans to increase public ownership of power assets, build more generating capacity and encourage more competition in the market, becoming more self-reliant.

“Our country, with its abundance of solar, wind and gas resources, is now facing an energy crisis. We also have a system that puts profits before people,” Weatherill said.

“An absence of coherent national energy policy and ideological attacks on the renewable-energy sector have led to under-investment in much-needed new energy sources.”

The government plans to use its own energy contract to attract a new energy supplier to the state and increase competition.

Incentives will also be offered to source and use gas locally, with the exploration grants doubled to $48 million and landowners offered a 10% royalty share for allowing exploration on their property.

The plan claims it will create 630 jobs – 530 through the construction of initiatives in the plan and 100 from increased gas exploration.

The state’s go-it-alone approach will also see it legislate to give the SA energy minister and treasurer Tom Koutsantonis greater powers to direct the energy market if there’s a supply problem.

The plan says it’s “a last-resort measure if the national market does not act in South Australia’s best interests”.

Load shedding during a heat wave in February led to another round of political bickering and blame-shifting after it emerged that a gas-fired plant in the state had not been turned on despite the shortfall in power generation.

The plan has an “energy security target” demanding that retailers source 36% of their energy from “cleaner generators that produce their electricity using South Australia’s abundant natural resources”, a figure that increases to 50% by 2025. The state is also aiming for $10 billion in low carbon generation by 2025 and net zero emissions by 2050. It wants Adelaide to become the world’s first carbon neutral city.

“We have taken on significant challenges and come up with the solutions,” Weatherill said, releasing the plan.

Here’s how the government explains its energy plan:

Our Energy Plan from Jay Weatherill on Vimeo.

NOW READ: ACCC’s Rod Sims: ‘Our energy markets as a whole could be said to be in crisis’

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