Italian asset management company Sosteneo has purchased 100% of the Koorangie Energy Storage System (KESS) project, which is being developed by Edify Energy in Victoria, Australia.

The transaction marks Sosteneo’s entry into Australia following its launch in September 2023 as a joint venture between Generali Investments Holding and industry experts.

Edify Energy has now closed financing on the A$400m ($254.9m) project, a 185MW/370 megawatt-hour battery storage system.

To be located in the Murray River region near Kerang in Victoria, KESS has also received A$119m from the Victorian Government.  

It is also supported by a long-term syndicated debt facility offered by Australia’s Commonwealth Bank (CBA), Norway’s DNB and French bank BNP Paribas.

The project is scheduled to come online in 2025 and help to meet Victoria’s targets of 2.6GW of energy storage by 2030 and 6.3GW by 2035.

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KESS has a 20-year system support agreement in place with the Australian Energy Market Operator (AEMO).

The storage system will be powered by Tesla Megapacks, which feature grid-forming inverters that run in “virtual machine mode”.

This feature allows the system to work in a similar manner to a conventional generator, with the capacity to meet the energy needs of 350,000 households for two hours.

Shell Energy has already entered a 15-year offtake agreement for the full capacity of KESS.

Edify Energy founder and CEO John Cole stated: “Edify continues its march forward, developing, financing and operationalising new energy assets to increase renewable penetration and power system stability as well as delivering affordable, reliable and dispatchable clean electricity.

“We welcome Sosteneo as our equity partner and their faith in us. Edify delivers, and we look forward to bringing our third and largest BESS [battery energy storage system] to market in short order.  Our ecosystem of trusted partners is maturing and deepening with KESS. 

“We are delighted to be delivering a groundbreaking project with partners and stakeholders we have worked with on other assets including AEMO, BNP Paribas, CBA, Consolidated Power Projects, DNB, Gannawarra Shire Council, Shell Energy, Tesla and the Victorian Government. Strong relationships are a cornerstone of the Edify team and are critical for an accelerated energy transition.”