Grid-forming batteries like FRV’s Terang BESS and AGL’s Tomago project are quietly rewiring Australia’s grid, turning AI-driven storage into core green infrastructure.
Australia just cleared another 2,200MWh of large-scale battery storage — and not just any batteries, but grid-forming systems that can actively stabilise the power system instead of passively following it.
This matters because the National Electricity Market (NEM) is racing towards very high levels of wind and solar. Coal exits are accelerating, extreme weather is more frequent, and volatility is rising. The grid either gets smarter and more flexible, or reliability and prices become a real problem.
The reality? It’s simpler than you think: big, intelligent batteries are becoming the backbone of a modern green grid, and they’re powered by software and algorithms as much as by hardware.
In this post, part of our Green Technology series, we’ll look at two milestone projects – FRV Australia’s Terang BESS in Victoria and AGL’s Tomago Battery Project in New South Wales – and break down what they signal for clean energy, AI-enabled storage, and investment opportunities in the next wave of green infrastructure.
Grid‑Forming Battery Storage: Why These 2,200MWh Matter
The key point: FRV Australia and AGL have progressed 2,200MWh of grid-forming battery energy storage that will help keep the NEM stable as more renewables come online.
Here’s what’s actually happening:
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FRV Terang BESS (Victoria)
- 100MW / 200MWh grid-forming battery
- Now connected to the grid and entering commissioning
- Supplied by e‑STORAGE (Canadian Solar) with optimisation from Fluence’s Mosaic software
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AGL Tomago Battery Project (New South Wales)
- 500MW / 2,000MWh grid-forming battery
- Construction underway, targeting operation in the second half of 2027
- Approx. AU$800 million project cost
- Fluence contracted for technology, construction, and long‑term service
Both projects will connect to the National Electricity Market and both are grid-forming, which is the real story here.
What “grid‑forming” means in practice
Most older batteries are grid-following: they “listen” to the grid’s voltage and frequency and then respond. Grid-forming batteries work differently:
- They create a stable voltage and frequency reference instead of just following one
- They provide synthetic inertia and fast frequency response when the grid is stressed
- They help restart parts of the system after blackouts (black start capability)
So as coal and gas plants retire, grid-forming storage can take over many of the “invisible” services those generators used to provide — but faster, cleaner, and usually cheaper once built.
From a green technology perspective, this is where hardware, power electronics, and AI‑driven control software meet to keep a renewables‑heavy grid stable.
Inside FRV’s Terang BESS: A 200MWh AI‑Optimised Grid Asset
FRV Australia’s 100MW / 200MWh Terang BESS is its first standalone storage project in the country and is now energised and entering commissioning. It’s relatively modest in size compared with Tomago, but strategically important.
Why Terang is a meaningful milestone
Terang shows how software-defined storage is becoming standard in utility projects:
- The battery hardware is supplied by e‑STORAGE, a Canadian Solar subsidiary
- Operations are optimised using Fluence’s Mosaic software
- Intelligent algorithms control when to charge, discharge, and provide grid services
Instead of just storing excess solar and releasing it in the evening, Terang can:
- Respond to price signals and congestion in real time
- Reduce demand peaks and support system security
- Provide grid‑forming services that support higher renewable penetration
In other words, it behaves less like a static asset and more like an AI‑enabled energy trader + grid stabiliser.
What Terang tells us about the next wave of storage
For developers, utilities, and investors, Terang highlights three clear trends:
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Stand‑alone storage is now mainstream
This isn’t just about co‑located solar‑plus‑storage anymore. Batteries are being built where they create the most value for the grid, not necessarily where the sun is strongest. -
Software is the differentiator
Two 200MWh batteries can have totally different economics depending on how smart their control systems are. Better algorithms mean:- Higher revenue per MWh installed
- Longer asset life via smarter cycling strategies
- Better participation in multiple markets (energy, FCAS, capacity, etc.)
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Grid‑forming is becoming a default expectation
As AEMO and state governments push for firmed renewables, projects that support system strength and inertia get prioritised. Terang fits exactly into that policy direction.
If you’re planning a project or building a business case for storage, you don’t just ask, “How big should the battery be?” You now ask, “Which grid‑forming capabilities and which optimisation stack do we need to compete?”
AGL’s Tomago Battery: 2,000MWh at the Heart of the NEM
AGL’s Tomago Battery Project in New South Wales is on a different scale: 500MW / 2,000MWh, AU$800 million in capex, and one of the largest grid‑forming batteries in Australia.
Why Tomago is strategically placed
Tomago isn’t just big; it’s in a critical location:
- New South Wales is heavily exposed to coal retirements
- The Hunter region is a major industrial cluster that needs reliable power
- The site connects directly into the NEM, giving it broad system impact
Tomago is designed as a 4‑hour battery (2,000MWh at 500MW), which is ideal for:
- Covering the evening demand peak as solar drops
- Firming wind and solar over intraday swings
- Providing extended contingency support during outages or extreme weather
AGL has a corporate target of adding 12GW of renewables and firming by 2035. Tomago is a cornerstone of that strategy, not a side project.
Fluence’s role and what that signals for the market
Fluence has secured what it calls its largest global contract for Tomago’s 2,000MWh grid-forming battery system, supplying its Gridstack Pro platform and constructing the project.
Why this matters:
- Standardised, modular tech: Gridstack Pro is purpose‑built for large, complex projects, which means faster deployment and better reliability compared with bespoke one‑offs.
- End‑to‑end scope: Fluence isn’t just providing hardware; it’s also constructing and maintaining the system. That’s attractive to investors who want fewer integration risks and clearer performance guarantees.
- Bankability: Having a global storage specialist with a long‑term service commitment makes it easier to finance and insure assets of this scale.
From a green technology and AI angle, Tomago is effectively a software‑driven power plant. Its real value comes from how intelligently it orchestrates charging, discharging, and grid services over thousands of hours every year.
How AI and Smart Software Turn Batteries into Grid Infrastructure
The core idea: AI and advanced control software are what turn a 2,200MWh pile of batteries into reliable, investable grid infrastructure.
Both Terang and Tomago use intelligent software layers (like Fluence Mosaic and Gridstack Pro) that:
- Forecast demand, prices, and renewable output
- Optimise when the battery charges or discharges
- Manage state of charge and degradation to extend lifetime
- Provide multiple services at once (energy arbitrage, FCAS, system strength)
Practical benefits for operators and the grid
Here’s what smart, grid‑forming storage delivers in practical terms:
- Reduced curtailment of renewables: Instead of spilling excess wind and solar, batteries store it and feed it back when it’s needed.
- Lower peak prices: By discharging during extreme peaks, batteries can reduce wholesale price spikes and lower average costs over time.
- Improved reliability: Fast frequency response and synthetic inertia improve grid resilience during faults or sudden outages.
- Faster coal exit: As more of these batteries connect, system operators are more comfortable allowing thermal plants to retire.
For businesses and investors looking at green technology, this is the key shift: storage is no longer just a “nice to have” attached to renewables – it’s core grid infrastructure.
What this means if you’re planning or investing in storage
If you’re considering utility‑scale storage, either in Australia or in another market following a similar path, here’s what I’d prioritise:
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Grid‑forming capability as a design requirement, not an add‑on
Ask directly: what services will the asset be able to provide apart from simple energy arbitrage? Can it support system strength, inertia, and black start? -
Software stack and data strategy
- Who owns and controls the operational data?
- How are optimisation algorithms updated over time?
- Can the system stack value streams across multiple markets?
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Policy and market alignment
In Australia, the NEM is evolving quickly to reward system services. That’s likely where other markets are heading. Design your project so it can monetise future services, not just today’s. -
Partnership model
Projects like Tomago show the value of working with specialists on EPC and long‑term service. For most organisations, trying to do everything in‑house is a distraction and a risk.
These are the levers that separate profitable, bankable green technology projects from stranded or underperforming assets.
Australia’s Green Superpower Ambition – And Where You Fit In
Australia’s grid‑forming battery pipeline is now measured in dozens of projects and multiple gigawatt‑hours, with 2026 and beyond set for exponential growth in both front‑of‑the‑meter and behind‑the‑meter storage.
Terang and Tomago are early proof points of a much bigger shift:
- The NEM is being redesigned around flexible, digital, and low‑carbon assets
- Energy storage is moving from experimental to essential
- AI‑driven control is becoming standard in every serious green infrastructure project
If you’re:
- A business with rising energy risk, these projects show what “firmed renewables” will look like in practice – and what you should be asking your energy suppliers about.
- A developer or utility, they’re a template for integrating grid‑forming capability and advanced optimisation from day one.
- An investor, they’re a signal that large‑scale, software‑defined storage is now central to Australia’s path to becoming a green energy superpower.
The next few years will reward organisations that treat energy storage not as an afterthought, but as a core pillar of their green technology strategy.
If you’re planning a project, reviewing an energy strategy, or building a business case around storage and AI‑enabled clean energy, this is the moment to move from watching to acting.