National Electricity Market: dispatchable energy storage for firming capacity

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National Electricity Market: dispatchable energy storage for firming capacity

Firming generation for energy network security
Early-stage proposal (Stage 1)
National Electricity Market
Energy Transformation
Problem/Opportunity timeframe
Various (0-15 years)
Proposed By
Infrastructure Australia identified proposal
Date added to the IPL
26 February 2021
National Electricity Market-Dispatchable energy storage for firming capacity


The National Electricity Market (NEM) will require significant investments in dispatchable energy storage to support growing renewable energy generation and the future retirement of coal-fired generators.

The 2019 Australian Infrastructure Audit identified that new forms of large-scale energy storage are increasingly available, including pumped hydroelectric and battery assets.

Introduction of new firming capacity will complement variable renewable energy sources and support the transition to the new electricity mix. However, without sufficient dispatchable capacity, there is a risk of power outages and load shedding in the NEM.

Dispatchable storage can absorb energy in off-peak periods and release it when it is most needed to secure stability of the NEM.

The Australian Energy Market Operator has released the 2020 Integrated System Plan, which forecasts that 6–19 Gigawatt (GW) of new dispatchable storage will be required by 2040. This is to firm up distributed energy sources and utility-scale variable renewable energy, such as solar farms.

Storage options range from large-scale investments (such as utility-scale pumped hydro) to smaller battery storage facilities.

The Infrastructure Priority List separately includes an Early-Stage Proposal for the expansion of Renewable Energy Zones in the NEM.


Potential options to address the proposal include:

  • distributed batteries
  • large-scale battery energy storage systems
  • utility-scale pumped hydro.

It is likely that a diverse mix of technologies will be required to support the NEM.

Next steps

Proponent(s) to be identified.