The 2025 edition of the Energy Storage Summit (ESS) Australia was held over two days in Sydney last week.

With energy storage projects currently experiencing something of a boom, I flew down to Sydney to attend the conference to gain some insight into the state of development, project financing and operations for this growing subsection of the market.

Rather than offering an exhaustive summary of the conference, this short article reflects on three high-level themes that stood out to me as I reviewed my notes from the conference.

1. A wave of first-time owners will join the ranks

Back in October, James Tetlow spoke at the All-Energy conference in Melbourne about why operating a BESS is fundamentally different from operating a wind or solar farm—using a brilliant flying analogy to illustrate his point. We’ve since published that presentation as an article here on WattClarity, so I’d highly recommend reading it if you haven’t already.

On the morning of day one at ESS last week, Matt Grover from Fluence spoke about this same theme in his opening keynote. He showed that all batteries currently connected to the NEM have been operated by just thirteen participants—and built over a span of eight years. Yet in the next two years alone, fifteen participants are expected to begin operating their first battery.

This shift, he explained, is likely to bring about several macro and micro effects:

• Market-level impacts: such as increased competition, mitigation of market power, and greater diversity in trading objectives; and
• Participant-level impacts: such as the need to understand how to operate scheduled assets, adopt new IT systems and processes (e.g. auto-bidding software, spot traders, 24/7 control rooms), and greatly enhance other organisational capabilities.

Ironically, it was Matt—representing one of the earliest auto-bidding providers— who was one of the few speakers to clearly convey that operating a battery in the NEM is far from a set-and-forget exercise. There is a growing feeling from those inside the market that many of these new entrants may get caught unaware that operating a ‘scheduled’ asset involves far more compliance obligations and commercial risks than ‘semi-scheduled’ wind or solar farms that many renewable developers would be more familiar with.

On a similar note, in a panel session later that day, I noted that one existing battery owner made the point that while their auto-bidder had helped the asset outperform initial revenue models, the level of human interaction with the software had been increasing in recent years—driven by growing market complexity.

2. Development taking centre stage over the market

Building on the previous theme, much of the conference focused on opportunities/challenges in the development and financing space.

Some of these development pains were mentioned on a panel titled ‘The Developer Conundrum – Challenges to Operations’, with panelists Killian Wentrup from ACEN Renewables and Tom Best for Eku Energy particularly noting two key issues slowing down storage assets in the grid connection process, making the argument that:

• The process would benefit from OEMs directly communicating to the AEMO and NSPs about capabilities of grid-forming inverters;
• GPSs would benefit from more standardisation so language is consistent, as too often, these agreements need to be written from scratch.

For me, it was also striking to reflect on what wasn’t being discussed on stage.

Whilst there were some presentations and panels on price volatility and recent merchant revenue outcomes, I found it surprising that little discussion was made about underlying drivers of volatility or how incoming market changes will impact storage assets.

As an example of this, in my notes, I wrote down that the new FPP mechanism did not garner a single mention on stage over the two-day conference. This was surprising to me, given the recent analysis from Jack Fox that we’ve published, who has declared batteries as one of the big winners of the incoming FPP changes and even listed the top 10 batteries during the current NFO period.

Based on that underlying data, individual battery assets were projected to earn up to $600k annualised, on a net settlement basis, based on the NFO period of the new mechanism. To stick to the early mentioned flying analogy, perhaps both the winners and losers are flying blind to such market changes.

3. Banks are starting to make sense of volatility

Volatility was a buzzword over the two days.

Simon Brooker from Zenobe delivered a memorable one-liner about the NEM’s volatility: “It feels like we have one hand in the oven and one in the freezer, but somehow everything sort of seems okay for now.”

Sahand Karimi from OptiGrid further pointed out that many in the industry appear to conflate price volatility with price spreads. I interpreted these comments to mean that volatility implies unpredictability—not just rapid or wide-ranging price changes—a rather crucial distinction for operators and analysts.

One of the most consistent themes across the two-day conference was that investor attitudes toward batteries are evolving quickly.

Thomas Schmitz from Aquila Clean Energy reminded the audience for his panel that despite current market dynamics, energy investors continue to tend to be more conservative by nature – in his opinion, it’s typical for them to seek a return on investment in the range of 7 to 9%. With this in mind, the consensus appears that banks are becoming more comfortable with newer revenue models beyond traditional tolling agreements.

Craig Francis, the CEO of Genex, echoed these thoughts. Although the company’s two storage assets are fully contracted long-term (Kidston with a 30-year PPA and Bouldercombe underwritten by a long-term revenue-sharing agreement with Tesla), he believes that investors are becoming more open to higher levels of merchant exposure.

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With storage becoming an increasingly important and fast-growing part of the electricity market, ESS 2025 proved to be a worthwhile addition to an already busy conference circuit. It provided a timely snapshot of how this part of the industry is beginning to mature—and where attention is focused.