Iberdrola Buys Tungkillo Battery Storage Project in Australia

In a bid to gain exposure to South Australia’s dynamic electricity market, Spanish utilities firm Iberdrola has acquired the Tungkillo battery storage project, located in South Australia, from the RES Australia group, for a little over $320 million.

This infrastructure, which will have 270 MW and a storage capacity of 1,080 MWh, has all the key approvals and very advanced connection rights, in addition to the land already secured. Its entry into operation is expected in 2028.

The Australian system requires a significant increase in battery storage capacity to integrate the new renewable capacity and bring flexibility to the system. The location of the Tungkillo project, in the south of the country, is optimal for providing this service.

Tungkillo is a small rural town located approximately 60 km northeast of Adelaide, and it was named after a nearby mine that opened in 1867, with the town itself nestled among sweeping hills and meandering valleys, adorned with giant gum trees.

The project will connect to the adjacent ElectraNet-operated Tungkillo substation via a dedicated transmission corridor, providing direct access to South Australia’s transmission network and the wider National Electricity Market (NEM).

In the case of Iberdrola Australia, the storage systems provide backup capacity for its portfolio of energy sales contracts to customers. The company has two other projects under construction, Smithfield (in New South Wales) and Broadsound (in the state of Queensland), which will come into operation in 2026.

Consistent with 2025-28 Plan

The acquisition of the Tungkillo battery system is fully consistent with the Group’s recently presented 2025-28 plan, which foresees total investments of more than $1.17 billion in Australia, a country with a AAA credit rating, mainly in battery development.

The plan foresees a total investment of $67.62 billion, an amount that will be allocated 85% to countries with an A rating equipped with stable, predictable and attractive regulatory frameworks. The UK will be the main destination for investment, with $23.32 billion, followed by the US with $18.65 billion, the Iberian Peninsula, with $10.49 billion, Brazil, with $8.16 billion and other EU countries and Australia, with $5.83 billion.

Iberdrola in Australia

According to media reports, Iberdrola maintains a strong presence within the Australian energy storage market, operating multiple renewable energy and storage projects across New South Wales, Queensland and South Australia.

The Spanish utility’s Australian portfolio includes operational and development-stage projects across multiple states. In New South Wales, Iberdrola’s 130MWh BESS recently became ready for commissioning at the Avonlie Solar Farm, while in Queensland, the company started construction of a solar-plus-storage project featuring 275MW of solar generation co-located with 137.5MW /275MWh of battery storage.