![Solar PV panels in China's Fujian province: David Green of Lyon Group says Australia is "naive" about the technology.](/content/dam/images/g/s/z/c/o/z/image.related.afrArticleLead.620x350.gug9i6.png/1487499060484.jpg)
An Australian company says it will build solar and battery facilities in SA this year with enough storage capacity to meet the power shortfall that caused blackouts in the state 10 days ago.
David Green, a partner of Lyon Group, told The Australian Financial Review he was "very confident" his firm would install two 50 megawatt battery storage facilities in SA this year after signing an equity finance agreement with $13 billion US-based hedge fund Magnetar Capital.
Mr Green said that the facilities linked to large-scale solar generation that Lyon Group planned to build would have "easily been enough" to meet the crisis on February 8 that cut power to 90,000 homes in SA when a surge in peak electricity demand during a heatwave and problems with gas and renewables caused a shortfall of 100 megawatts a power.
Mr Green said that Australia was "very naive" about the role that large-scale batteries – which can be turned on almost instantaneously – were already playing in ensuring system reliability and cutting off peaks in demand. He said Lyon's technology was already in use in the US and Chile.
Mr Green said the deal with Magnetar on solar and an earlier deal with Mitsubishi on battery storage opened the way for projects with capacity of 1000 megawatts of grid-connected solar. Lyon has previously announced projects in SA at Roxby Downs and in Far North Queensland with a combined generation capacity of 240 megawatts.
Mr Green is due to appear at hearing in Adelaide on Monday before a Senate inquiry into the resilience of the power grid that was called after storms caused massive blackouts in SA last October .
French power company Engie, which operates SA's largest gas-fired power stations, will also be asked to explain why it did not turn on one of the turbines at the Pelican Point gas-fired plant during the SA power crisis this month. Engie told the Financial Review last week that it was uneconomic to keep the plants on stand-by in case of a demand peak without some subsidy.
The Turnbull government over the weekend however continued to blame for the crisis on the problems caused by the intermittent nature of renewables, which supply 40 percent of power in SA.
Energy minister Josh Frydenberg on Sunday said that he was looking at using the Clean Energy Finance Corporation to fund so-called high-efficiency low-emissions "clean coal" as a more source of power.
Mr Frydenberg told ABC television: "The issue is if you can lower emissions and stabilise the system with baseload power, that's a pretty good outcome for Australian households,"
"That is certainly one of the options that we are looking at because we have recognised that we have an obligation after what we have seen in South Australia to ensure that this does not happen across the country."
Under current guidelines, the CEFC cannot invest in technology unless it cuts emissions by over 50 percent, which is well beyond the capacity of clean coal plants.
But those guidelines could change, especially if the federal government appoints supporters of clean-coal technology when the majority of the CEFC board comes up for renewal this year.
That would not solve the problem that the CEFC is forbidden by law from investing in carbon capture and storage technology, which many believe would be needed to make clean coal viable.
Market sources have questioned whether the CEFC could find equity partners to fund a coal plant, given the political uncertainty over carbon pricing and the falling prices for renewables.
Moreover a new coal plant would take a least a decade to build, but renewables will grow sharply in the next few months in response to the federal government's 23-percent Renewable Energy Target.