The mothballed Angas Zinc Mine, about 45 kilometres southeast of Adelaide, will be converted into an advanced compressed air energy storage plant.

The project will cost $30 million, with South Australian taxpayers chipping in $3 million and $6 million coming from the Federal Government’s Australian Renewable Energy Agency (ARENA). The facility will produce five megawatts of output and feature 10 megawatts of storage.

It will be built and run by Canadian company Hydrostor Australia.

The technology works by using electricity from the grid to run a compressor, which produces heated, compressed air.

The air is then pumped into an cavern deep underground – displacing water into an above-ground reservoir – and kept at constant pressure.

When power is required, hydrostatic pressure is used to force water back into the cavern and push the compressed air up to the surface, where it is reheated and expanded through a turbine to generate energy.

ARENA CEO Darren Miller says the pilot project could “open up a new form of renewable energy storage in Australia, which helps to support ARENA’s investment in delivering security and reliable electricity”.

“While being a commercial demonstration at this stage, Hydrostor’s innovative way to store energy with air could add to Australia’s grid-scale storage capability, complementing pumped hydro and batteries,” he said.

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Federal Trade and Investment Minister Simon Birmingham said the project would produce reliable, renewable energy.

“Federal and state governments are committed to seeing renewable energy deployed – but we know that the downside of renewable energy is that it doesn’t always provide the reliability when you need it,” Birmingham told reporters at a press conference in Strathalbyn this morning.

“That’s why energy storage is so critical.

“This type of project … is a new technology that runs in a way not dissimilar to the way pumped hydro works, providing clean, reliable storage that can go into the grid when required.”

Federal Energy Minister Angus Taylor said in a statement that “a 250 per cent increase in variable renewable energy over the next three years requires additional investment in energy storage to deliver reliable 24/7 power”.

“The Commonwealth Government, through ARENA, is supporting the reliable integration of renewable energy through energy storage projects like this.”

South Australian Energy Minister Dan van Holst Pellekaan said the State Government was “fully committed to making energy cheaper, more reliable and cleaner; all three of them are high priorities for us”.

“We are wonderful in South Australia at generating electricity from sun and wind, but storage has been the missing piece of the puzzle that the Marshall Liberal Government is determined to insert into our energy system.” he said.

Labor energy spokesperson Tom Koutsantonis told InDaily although he was pleased that the Government was investing in renewable energy, he wanted to know what happened to other renewable projects announced by the Marshall Government.

“All new renewable energy projects … are fantastic, but quite frankly, you need less announcements and more construction,” he said.

“Where is the (Port Augusta) solar thermal plant (and) the pumped hydro in the Flinders Ranges?”

He said documents released under freedom of information laws showed only 100 solar batteries from the Marshall Government’s 40,000 home solar battery scheme had so far been installed.

“We (the former Weatherill Government) got the world’s largest battery built … in a year,” he added.

Hydrostor CEO Curtis VanWalleghem explained that his company’s technology pushes air down to lift water up, as distinguished from pumped hydro plants, which push water to the top of an incline before releasing it downwards.

“The main advantage of this is we’re not reliant on the hills or the right sites for pumped hydro – so we can go really anywhere, and it’s a much cheaper alternative to batteries,” he told reporters.

“We think it’s a great complement to the existing technologies and suite that exists on the electrical grid here.

“We’re excited to take this mine that was in care and maintenance and give it a second light.”

He said the company intended to establish other compressed air energy storage projects elsewhere across the country.