(Reuters) - Australia's AGL Energy Ltd (AX:AGL) has agreed a 15-year deal to buy battery power from Australian-Chinese Maoneng Group to ensure supply and pricing security during peak periods, the companies said on Wednesday.
Maoneng will develop four large-scale batteries with a total capacity of 200MW/400MWh to be operational from 2023 to fulfil the deal.
AGL will be able to call on that supply, which is enough energy to power up to 30,000 homes, for a fixed price over the 15 years.
The deal comes as Australia struggles to cope with variable wind and solar power and ageing coal-fired plants that are often overloaded during the hot summer months, leading to widespread shutdowns and price spikes for consumers.
"Australia’s energy market is undergoing significant changes and large-scale batteries like these will be pivotal in providing firming capacity in the shift between baseload power and renewables," AGL Chief Executive Brett Redman said in a statement.