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- Genex Power (ASX:GNX) wins approvals to load a full 50MW capacity into its Bouldercombe battery project in Queensland
- The BBP is a big battery project
- The battery is grid-scale, meaning it can store power generated by wind and solar overnight for dispatch into the local grid
- Energy storage batteries are a crucial element of decarbonisation
- Tesla’s big battery division is currently more profitable than its car business
- Shares last traded at 17.5 cents
Genex Power (ASX:GNX) is the latest to claim fame from operating a big battery project in Australia, with its Bouldercombe battery project (BBP) going live today.
Genex now has receipts for full approvals to dispatch up to 50 megawatts (MW) into the local Bouldercombe substation.
That substation is a key node in QLD’s state electricity grid.
Tesla megapacks in use
Genex is using 40 Tesla-made megapack grid-scale storage batteries with 38 of 40 being initially utilised as commercial operations kick off.
The models are not without controversy.
They have been implicated in at least two big battery fires in Australia in the last three years – and have already caused trouble at Bouldercombe.
Two fires in three years
In 2021 in Victoria, a Tesla megapack unit caught fire at the Victorian big battery project near Geelong.
Then that happened again in September last year, this time at Genex’s Bouldercome battery project.
Insurance boffins will likely be watching closely to see what happens over this summer.
In both cases, fires burnt out over a number of days. Due to the nature of large lithium batteries, simply hosing down the assets doesn’t particularly work.
Nearby residents were advised on both occasions to close windows, lock doors, and to not breathe in any fumes.
Lock in concerns
Also worth noting is that Tesla’s megapack batteries come with software that ultimately gives Tesla control of electricity flows.
This software contract also gives Tesla a ten-year lease over the assets it’s just sold to third parties.
Purchase of the software is, unsurprisingly, highly recommended by the automaker best known for its eccentric billionaire owner.
Management comment
“I would like to extend our gratitude to Tesla, Consolidated Power Projects, Powerlink and Amplitude Consultants for their collaborative roles,” Genex CEO Craig Francis said.
Powerlink is a QLD utility provider facilitating the connection between the BPP and the Bouldercombe substation.
“A looming El Nino summer … is anticipated to place significant stress on the
electricity network,” Mr Francis added.
“The commencement of operations will mark the next step-change in revenues
and cash flows for Genex, and we are also extremely pleased that Bouldercombe will be able to play its part in supporting the Queensland energy system over this period.”
Standalone BESS
All in all, Genex now runs the first standalone battery energy storage system (BESS) asset in the northeastern mining state.
Notably, key electricity approvals have been attained right before the start of summer.
In Q4 of CY22, the National Electricity Market (NEM) saw 40 per cent of demand supplied by renewables.
Race to net zero
These numbers may not be particularly impressive for West Australians who are used to seeing rooftop solar contribute huge chunks of South West Interconnected System (SWIS) grid demand.
With Genex’s BBP, it’s likely that summer demand could be more than 40 per cent of renewables supplies in Queensland – whether critics like it or not.
Genex Power is also developing the Kidston Pumped Hydro project in Queensland, which is nearing completion after years of work and myriad delays.
Shares last traded at 17.5 cents.
