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Vanadium flow batteries are taking on the long duration storage challenge

As Australia continues its transition from fossil fuels to renewable energy, there is growing interest in vanadium flow batteries and other storage technologies that can provide medium-to-long duration storage.

Energy Synapse sat down with Jeremy Peters, an expert in vanadium flow batteries, to get his insights on the key advantages of the technology, how it is being deployed, and where the biggest opportunities are in the Australian market. Jeremy Peters is the General Manager Energy at Vecco Group and is responsible for downstream business including electrolyte manufacturing and battery projects. Jeremy has 20 years of experience in the electrical industry and is a Director of the Advanced Materials and Battery Council

Can you tell us more about vanadium flow battery technology and how it has been deployed internationally?

Vanadium flow batteries (VFBs) are a mature and proven technology developed in Australia in the 1980s and have been commercialised overseas.  There are hundreds of VFB installations globally with China leading the world on scale with a 700 MWh project commissioned in 2024 and gigawatt manufacturing facilities now in operation.  We are seeing significant growth in the pipeline for VFBs locally in Australia, with recent deployments in South Australia and Western Australia, as well as the battery jointly delivered by Vecco and Sumitomo Electric for Energy Queensland in 2024 with 100% of its electrolyte made at Vecco’s Townsville facility.

VFBs are durable, have no cycle limitation, are not susceptible to thermal runaway and the electrolyte does not degrade. The battery’s energy capacity is directly linked to electrolyte volume installed, with systems typically ranging from 4 to 12 hours of duration. As a result, they are highly scalable and cost-effective. To increase storage, you simply add more electrolyte to the tanks. As capacity (i.e. duration) increases, the cost per kilowatt-hour drops significantly.

Due to their proven capability and unique characteristics, both fundamental to the bankability of these batteries, VFBs are becoming a key long duration energy storage solution set to significantly increase their market share, as the supply chain matures, and adoption accelerates.

What are the biggest opportunities for vanadium flow batteries in an Australian context, in terms of application, size, storage duration?

In Australia, the greatest opportunities for VFBs are in applications requiring long duration storage – typically 6 hours or more – where their unique advantages offer both technical and economic benefits. VFBs excel in scenarios where durability, safety and daily cycling are critical, offering a distinct competitive advantage over other technologies.

The greatest opportunities we see are:

Energy shifting in distribution networks: With Australia having one of the highest per capita rates of rooftop solar, VFBs can play a key role in energy shifting. This means storing excess solar energy generated during the day for use in the evening when demand peaks. Their long-duration capabilities allow for substantial load shifting, easing pressure on the grid and enhancing system resilience.

Diesel replacement in mining and industrial sectors: Australia’s remote mining operations and industrial sites, often relying heavily on diesel generators, can significantly benefit from VFBs. The battery’s ability to provide reliable, long duration storage without degradation makes them an ideal solution for off-grid power, reducing both fuel costs and carbon emissions. VFBs’ durability and unlimited cycle operations also mean they can handle the demanding, continuous energy needs of these industries.

Storage integration with grid scale generation: VFBs can be deployed alongside large-scale generators to improve resilience and allow for more flexibility in export scheduling. Their ability to provide extended discharge times without degradation makes them ideal for balancing out load changes, and smoothing out variability in renewable generation, ensuring a steady supply of power in more situations.

Vecco Group is actively building a local vanadium battery supply chain in Australia. Can you tell us more about the benefits of having a local supply chain and how it will impact VFB economics? 

With Australia hosting the world’s third-largest vanadium deposit and established mining and processing capabilities, Vecco plans to leverage our local manufacturing talent and develop a local end-to-end supply chain, rather than relying on the mine-and-export model Australia has adopted in the past.

From our customers, we know that one of the key barriers to vanadium flow battery deployment has been the historical volatility in vanadium prices, which can account for around 60% of the total battery cost. By controlling the entire supply chain – from mining to electrolyte manufacturing – Vecco can offer customers price certainty on the cost of vanadium electrolyte as they develop their battery project.

Our customers also recognise Australia’s low sovereign risk and strong mining reputation, which positions us as a reliable trading partner for VFB projects.

What is needed to increase adoption of VFBs in Australia? 

Essentially, everybody needs to keep doing what they’re doing. We are confident the market is heading in the right direction, and it’s important the industry continues advancing technology, improving efficiencies, and reducing costs.  Project owners need to critically assess and choose the right battery technology for their specific needs, ensuring that VFBs are considered for suitable applications. Governments also play a crucial role by supporting the development of a secure, domestic supply chain, fostering Australian manufacturing, and reducing reliance on imported batteries.

Are there any unique considerations that project developers and EPCs need to take into account if they are thinking about using vanadium flow batteries in their projects?

The batteries want to be used, developers and owners should focus on maximising the unique advantages these batteries offer. Rather than protecting them from use, they should leverage the unlimited cycle capability, fast response times, and apply value to the elimination of thermal run-away risk.  The long battery life (25 years) should be fully utilised and consider a second use or end-of-life cost recovery for the completely reusable electrolyte, adding further value to the system. Too often, we mistakenly see the operational parameters adopted in a lithium-ion battery model lifted and applied to vanadium flow batteries, which leaves value on the table.

We know from our customers that when operated in these sweet spots (e.g. duration, cycling frequency, life of asset etc), VFBs become economically competitive with lithium-ion batteries, which benefit from a mature supply chain operating at significant scale and capital invested.

While VFB technology is mature and proven, its supply chain is only now gaining significant momentum with the recent acceleration of demand for long duration energy storage. China is leading the way with GWh production facilities and battery deployments, which is already bringing costs down through scale and performance improvements. This ongoing investment into the VFB supply chain and learnings from deployments will only improve the cost competitiveness across broader long-duration energy storage applications. In August 2024, the US Department of Energy (DoE) released its extensive Earthshots Report on Long-Duration Energy Storage Technologies, which recognises this pathway for VFBs. The DoE project a levelised cost of storage of $0.06/kWh for flow batteries by 2030, outperforming all other electrochemical and thermal storage systems.

About Vecco Group

Vecco is an integrated critical mineral mining and manufacturing business, developing a vanadium battery supply chain in Australia, the USA & Europe.  Vanadium electrolyte is currently being manufactured by Vecco in Townsville at its commercial demonstration scale facility. Vecco’s critical mineral mining project in Julia Creek QLD is under assessment for mining lease approval.  Once operational, the Vecco integrated supply chain will mine, process and manufacture over 1 GWh of vanadium electrolyte each year.  Vecco is supported by Idemitsu (a global energy company), who recently acquired a controlling interest in Vecco via Idemitsu Australia, taking Idemitsu’s total investment in the Vecco Group to more than AUD $75 million.

About Energy Synapse

Energy Synapse is an Australian modelling and analytics firm specialising in wholesale electricity markets, renewable energy, and energy storage. We can tailor our market and revenue models to account for the unique technical parameters of any storage technology, including vanadium flow batteries. Learn more about our modelling services.

How sodium-sulfur batteries can help bridge the storage gap in the energy transition

As Australia’s coal-fired power stations progressively close over the next 10-15 years, it will be critical to ensure that the grid has enough storage to balance variable supply from wind and solar.

The size of energy storage systems is described by two parameters:

(1) the maximum power they can discharge into the grid; and

(2) their storage duration i.e. how long they can keep discharging at maximum power.

To date, the rollout of utility-scale battery storage in Australia has been dominated by lithium-ion batteries with short storage durations of two-hours or less. Batteries have big advantages in that they are modular, can be rolled out relatively quickly, and are not dependent on unique geographic formations.

However, long duration energy storage (LDES) has an important role to play in derisking the clean energy transition by protecting against prolonged droughts in wind/solar output. The federal government as well as the Queensland state government have both committed significant resources to pumped hydro projects. For example, Snowy 2.0 is expected to have almost a week’s worth of storage while Borumba Pumped Hydro could have up to 24 hours. However, these pumped hydro projects are incredibly complex and have long lead times. There is an opportunity for alternative battery chemistries, such as sodium-sulfur, to help bridge the gap between lithium-ion batteries and pumped hydro by providing medium-to-long duration storage within a much shorter lead time.

Energy Synapse sat down with Ross Sang, an expert in sodium-sulfur batteries, to get his insights on how this technology can help Australia transition to clean energy. Ross is National Business Manager, Energy Storage at BASF Australia (provider of NAS® batteries). BASF has recently been announced as a successful proponent in a battery trial designed to boost reliable renewable supply for regional WA.

Ross Sang, BASF Australia

Can you tell us more about sodium-sulfur (NaS) battery technology and how it has been rolled out internationally?

NAS® batteries were the first commercialised battery energy storage technology designed for large-scale stationary application. They have a successful track record over more than 20 years and have been deployed at more than 250 locations worldwide with a total power exceeding 720 MW and a storage capacity of approximately 5.0 GWh. It may be a surprise to many, that the largest battery in the world in 2016 was a 50 MW / 300 MWh NAS® battery that was constructed in 6 months in Japan and remains operational today.

What is the sweet spot for sodium-sulfur batteries in an Australian context?

The primary role of NAS® batteries in the energy transition is to support decarbonisation through energy arbitrage. This involves shifting large amounts of renewable energy to periods of low generation on a daily basis. The NAS® batteries large energy capacity and optimal discharge duration of 6-8 hours can support the displacement of fossil fuels in microgrids, industrial processes, and power generation and can be scaled up to hundreds of megawatts to support Australia’s path to its renewable energy targets on the grid.

What do you see as the main advantages of NaS batteries compared with other long duration storage technologies?

NAS® batteries operate at high temperature so they are not affected by ambient temperatures and do not require air-conditioning or a fire suppression system. This means they are particularly well suited to many arduous environments and have a very predictable degradation. This was well proven last year, whilst the first Australian NAS® battery was being commissioned at 45°C in Western Australia, another system was coincidentally being commissioned in South Korea at an ambient temperature of -18°C.

Furthermore, these attributes along with a number of others, mean the NAS® batteries have low maintenance requirements and the containerised design enables fast and simplified installation on site leading to a much shorter construction time compared to other LDES technologies.

Are there any unique considerations that project developers and EPCs need to take into account if they are thinking about using NaS technology in their projects?

As mentioned, the standard 20ft containerised form factor of NAS® batteries allows straightforward installation at the project site, and as the containers can be stacked, the footprint is relatively small. Due to the C-rate of 1/6, NAS® batteries are suited to applications of 6 hours or more and when paired with suitable Power Conversion Systems the NAS® batteries impressive response rate of <10ms can be utilised to perform advanced grid stabilisation services.