Salvos’ Neighbourhood Batteries To Bring Broader Benefits

Twenty-two Salvation Army sites in Victoria are among sixty-five more locations across the state to have energy storage installed under the Victorian government’s neighbourhood battery initiative.

The latest projects were announced as part of round two of Victoria’s $42 million 100 Neighbourhood Batteries Program. For the Salvation Army projects, batteries will be installed at various facilities including foodbanks, domestic violence refuges and emergency crisis accommodation.

Electricity can be a big expense for community organisations, and the Salvation Army is expected to see $790,000 in energy bill savings and income (from selling stored electricity at peak times) that will be invested back into their work in the community. Over what timeframe the $790,000 benefit will be wasn’t noted. The batteries will also provide backup power to the facilities during blackouts, allowing the services to continue some level of operations.

Among other organisations funded for neighbourhood batteries under round 2 are Housing Choices Australia sites across Melbourne, Venus Bay Community Centre and Reefton Fire Station in the Yarra Ranges.

The capacity of these batteries wasn’t mentioned in the media release, but under the initiative the minimum is 50 kW/ 100 kWh and the maximum 5 MW/ 10 MWh.

Other Benefits Of Neighbourhood/Community Batteries

One of the often-asked questions about neighbourhood (aka community)¹ batteries is how the broader community benefits – and in some cases, this isn’t really clear. This has led to some calls for community battery cash to be diverted to rebates for households for residential energy storage.

But community energy storage has its place.

There are scenarios such as the Salvation Army’s where the wider benefits are apparent – providing savings to groups that can then be re-routed to their core activities in the community, which can be invaluable.

Other benefits include taking pressure off the mains grid by sopping up surplus solar through the day. This supports grid reliability and can allow more solar power systems to be installed locally without more expensive network upgrades; the costs of which are usually passed on to electricity customers. Where flexible exports are in place, it can also mean lighter throttling less often for those with solar power systems; not that solar feed-in tariff rates are anything to get particularly excited about these days in many places.

Also, storing and dispatching energy locally is more efficient than having to transport it to larger-scale battery systems further away.

Even under some trial “pay for play” models where households subscribe to virtual storage services, the subscription costs have been designed to be less than what households would generally otherwise pay for equivalent conventional electricity supply – and subscribers avoid the significant cost of buying a solar battery. Western Australia’s Powerbank trial saw 533 participants save on average $70 per bill after subscription fees according to Synergy.

But community/neighbourhood battery models are a case of horses for courses – what might work well in one location may not in another.

Victoria’s Energy Storage Targets

The 100 Neighbourhood Batteries Program is contributing to the state’s energy storage targets that were legislated in March 2024, which are:

• at least 2.6 GW by 2030, and
• at least 6.3 GW by 2035.

The targets include the deployment of short, medium and long duration energy storage systems. Among the short duration systems are household batteries that can be aggregated and co-ordinated to operate as virtual power plants (VPPs).

There are now 90 neighbourhood battery projects in place or in the pipeline across metropolitan and regional areas of the state. More information on Victoria’s 100 Neighbourhood Batteries Program can be found here.