French renewable energy producer Neoen has contracted Tesla to expand the capacity of its Hornsdale Power Reserve in South Australia by 50%.

The 100MW/129-MWh lithium-ion battery, which was built in 2017, will be expanded with an additional 50MW/64.5-MWh of capacity. The project, which will receive debt financing support from the Clean Energy Finance Corporation (CEFC), is expected to be completed by mid-2020.

The expansion of the Hornsdale Power Reserve facility is expected to further increase the grid stability and also reduce consumer’s power bills.

Tesla agreed with the South Australian Government to pair a 100MW/129MWh lithium ion battery system with Neoen’s Hornsdale windfarm in July 2017, where it supplied and installed the grid-scale energy storage systems.

Within the first year of installation, the project resulted in savings of more than A$50m ($34m) to the consumers. The South Australian Government has agreed to provide A$3m ($2m) a year for a period of five years through a grant provided by its Grid-Scale Storage Fund.

The Australian Renewable Energy Agency has also agreed to provide A$8m ($5.4m) in grant funding through its Advancing Renewables Program on behalf of the Australian Government. Additionally, the project will also receive debt financing support from the Clean Energy Finance Corporation (CEFC).

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Neoen Australia managing director Louis de Sambucy said: “I would like to thank the South Australian Government, ARENA and the CEFC in supporting the expansion of the Hornsdale battery.

“The expansion of Hornsdale Power Reserve is demonstrating the critical and multiple roles that batteries will play in the grid of the future.

“I would also like to acknowledge the great support of the Australian Renewable Energy Agency to bring forward the critical innovations and regulatory changes that the network requires, and of the Clean Energy Finance Corporation for this first financing support for a battery project.”