Australia's AGL Energy greenlights $515 mln grid-scale battery project (updated)

AGL Energy

31/07/2025 24:27

Adds details and background throughout

July 31 (Reuters) - AGL Energy AGL.AX said on Thursday it had reached a final investment decision on an A$800 million ($515.28 million) grid-scale battery project, expanding its portfolio of flexible energy assets as part of a broader shift to cleaner energy.

The 500-megawatt, four-hour duration Tomago Battery will be located in the Hunter region in New South Wales. The company expects to begin construction later this year, with operations slated to commence by late 2027.

The battery will be funded through AGL's balance sheet using a mix of operating cash flow and existing debt facilities, including green capex loans.

The Tomago battery adds to AGL's growing stable of grid-scale assets, which includes operational batteries at Torrens Island and Broken Hill, as well as the 500 MW Liddell battery scheduled to come online in early 2026.

The company said it has a pipeline of a further 900 MW of battery projects approaching FID. AGL, which operates Australia's largest private power generation portfolio, is targeting a major pivot to flexible and renewable energy.

It aims to add more clean energy capacity as a part of its broader ambition to achieve net-zero emissions by 2035, shown by its recent acquisition of South Australia's Virtual Power Plant (SAVPP) from Tesla TSLA.O.

The company mentioned in its half-yearly results that it was targeting 1.4 gigawatts of grid-scale battery storage projects within the next year.

($1 = 1.5526 Australian dollars)

 (Reporting by Nichiket Sunil in Bengaluru; Editing by Leroy Leo)

 ((Nichiket.Sunil@thomsonreuters.com;))