BlackRock aims to deploy A$1bn into Australian energy storage

With the acquisition of Australian battery energy storage developer Akaysha Energy, the firm intends to build out a 1GW portfolio of projects in the country’s National Electricity Market.

BlackRock Real Assets has acquired Australian battery storage developer Akaysha Energy, marking the first energy storage investment in the Asia-Pacific region for the firm’s climate infrastructure business.

Infrastructure Investor understands the acquisition was made via the firm’s Global Renewable Power Fund III.

Speaking to Infrastructure Investor, managing director Charlie Reid, co-head of BlackRock’s climate infrastructure business in APAC, said the firm would look to deploy A$1 billion ($699.4 million; €688.2 million) towards the build-out of Akaysha’s 1GW portfolio – consisting of nine projects in Australia’s National Electricity Market – over the next three to five years. The firm will also look to allocate capital to building out assets in other APAC markets, particularly Japan and Taiwan, Reid said.

He declined to comment on the purchase price for the acquisition.

As Australia moves to meet its new renewable energy target of 80 percent of the country’s electricity mix by 2030, “this is a very attractive time to be investing in the Australian market”, Reid said.

“We believe that Australia is one of the most attractive markets globally as it relates to climate infrastructure and has the potential to become a renewable energy superpower,” he said.

“We think it’s an attractive market, both for domestic investment but also, as we’re doing [in the case of Akaysha Energy], for exporting the skills and capabilities that are derived from project experience in this market domestically, particularly across the Asia-Pacific.”

According to Reid, the firm identified battery storage across the Asia-Pacific region as a strategic priority roughly two years ago.

“Battery storage is a fundamental enabler for the energy transition,” he said, highlighting recent power cuts in Taiwan where the country’s push to meet its renewable energy capacity target of 27GW by 2025 had seen its grid placed under significant stress. The state-owned Taiwan Power Company recently announced its intention to source 10GW of battery storage in coming years to support a smoother transition to renewables.

“This is not an isolated event,” he added. “This will happen in each and every market. Renewables will be deployed up to a certain proportion of the grid and then there will be a fundamental requirement for battery storage to help support the grid through the transition.”

BlackRock’s GRP Fund III recently more than doubled its commitment in South Korean clean energy company Korea Renewable Energy Development and Operation Holdings, a company it acquired last July for an undisclosed amount.