Squadron Energy chief executive Jason Willoughby has warned that Australia’s National Electricity Market cannot reach full decarbonisation relying only on solar-and-battery hybrid projects, even though that combination has already pushed renewable penetration past the fifty percent mark. The message is clear: the technology mix must widen urgently to include wind, pumped hydro, long-duration storage, and demand-side flexibility if the grid is to remain reliable as coal exits.
Australia’s rapid rollout of utility-scale solar paired with lithium-ion batteries has been the workhorse of the transition so far, delivering low-cost energy during daylight hours and shifting a portion of it into the early evening. That formula has proven commercially attractive and technically straightforward, which explains its dominance in recent investment pipelines. But the operational limits are becoming apparent: multi-day cloud events, winter demand peaks, and the need for synchronous inertia to stabilise system frequency all expose gaps that four-hour batteries and midday generation simply cannot fill.
Willoughby’s intervention carries weight because Squadron controls one of the country’s largest renewable development portfolios and is directly exposed to the revenue risks of an over-concentrated technology stack. His call for diversity echoes the Australian Energy Market Operator’s Integrated System Plan, which models a least-cost pathway requiring roughly equal contributions from wind and solar, backed by deep storage and firming capacity. The industry’s challenge now is commercial: long-duration storage and pumped hydro projects face longer lead times, higher upfront capital, and revenue uncertainty that current market designs do not adequately reward.
Policy signals are starting to shift. The federal Capacity Investment Scheme has broadened its eligibility beyond short-duration assets, and several states are advancing structured tenders for long-duration storage and offshore wind. Yet the pace of financial close on these “next wave” projects still lags the retirement timetable for remaining coal units. Unless that gap closes, the NEM risks trading one reliability problem for another — replacing fuel-security risk with technology-concentration risk.
Read the full report at Energy Storage News.