South Australia will build Australia’s largest battery to store renewable energy and a new 250 megawatt gas-fired power plant.
South Australia’s premier Jay Weatherill announced on Tuesday the government’s plan to build, own and operate the plant which will cost $360 million.
He said it was part of a plan to spend $550 million to take control of the state energy market.
Mr Weatherill said the plan would put downward pressure on electricity prices.
“We’ll get reliable, affordable and clean power,” he said.
“Our state has built its reputation on a clean, green environment and this plan recognises that clean energy is our future.
“We’re taking charge of our energy future with a plan that will deliver South Australian power for South Australians.
“South Australians have been let down by a broken national energy market that puts profits before people. We’re going to put people first. ”
The plant will provide emergency back-up power and system stability services for South Australians, in the meantime procuring temporary back-up generation if necessary.
The strategy will also include legislation to give the energy minister direct power to intervene in the electricity market and the establishment of a $150 million renewable energy fund to encourage investment.
The government will also be able to use its purchasing power through its own electricity contract to attract a new power generator, increasing competition in the market, the announcement said.
The plan is expected to create at least 630 new jobs.
The government will set an energy security target to enforce electricity retailers to use more locally-generated power.
“This is a plan that puts control of our energy system back in South Australian hands,” energy minister Tom Koutsantonis said.
“For too long South Australian households and businesses have been at the mercy of private companies seeking to maximise their profits and a national operator that manages our grid from Melbourne and Sydney.”
It is unclear whether the announcement was linked to an offer from Tesla Inc boss Elon Musk on the weekend to install $25 million worth of battery storage within 100 days.
“We can’t rely on this broken national market any longer.
“Our plan will deliver increased local generation and powers to help prevent outages and more competition to put downward pressure on power prices for families and businesses.”
Mr Musk tweeted that if he couldn’t do it within the time limit the technology would be free.
Mr Weatherill said he would examine the offer.
Today’s announcement follows a string of power outages in South Australia, including a blackout that left industry crippled for up to two weeks and sparked fears of more outages across the national electricity market due to tight supplies.