The future..., page-6

You are too kind ozmacca.   

I don't see IFN has any need for a partner. A battery would be a profit centre in its own right  Also, the modifications needed to install a battery at Lake Bonney are so modest, the LGA would be nuts to delay the planning application unless they were part of Tony Abbott's rearguard action on behalf of coal.

I just posted this on reneweconomy's discussion on pumped hydro:

https://reneweconomy.com.au/pumped-hydro-slowly-starts-put-head-54001/

Excellent analysis and thank you David. I suspect the arbitrage opportunity has narrowed significantly with the introduction of the Hornsdale battery and more battery installations announced - today by Infigen for its Lake Bonney SA windfarm.

If this kit profitably removes the most extreme prices and encourages imitation through more installations, as is already happening, the benefits to pumped hydro shrink dramatically. I would hate to be committed to a half-decade engineering construction project and see the price arbitrage opportunities shrink and shrink and shrink each year. I think batteries will eat their lunch.

Adding a battery to any windfarm is a no-brainer. The frequency oscillation discount is removed, production above contracted can be saved and even on still days when wind cannot offer into the market, a zephyr that intermittently turns blades a little and pumps out a few volts has a use, a destination.

The widest price differential is between late night production and afternoon consumption. Wind, coal and run-of-river hydro all stand to benefit from batteries, much more than, say, solar, gas or biddable hydro. However, coal power businesses are universally being run for cash and cannot justify battery capex when the coal plant will clearly be closed by cost in the near future. They can of course free ride on the wind/battery combos of other players in the meantime, as their withdrawal from bidding into the midnight market increases coal's returns.

Disclosure: IFN.ASX

Ash