Contact will build a 100MW grid-scale battery at Glenbrook, rural South Auckland.
In an announcement to the NZX, Contact said the development will provide the company and the market with an important source of renewable electricity flexibility, and ultimately reduce reliance on traditional fuel sources as the company transitions to a low-carbon future.
The Glenbrook location was chosen because of its proximity to the NZ Steel plant and Transpower's grid connection point.
Tesla will supply its Megapack 2 XL battery energy storage system and will provide long-term maintenance at the facility.
The agreement also includes a provision to expand the capacity to 130MW over time.
Construction is expected to start immediately, costing $163m2 and is scheduled to be online early-2026.
"With the New Zealand Aluminium Smelter now confirmed to stay for the long-term, providing improved market certainty, Contact is advancing its plans for investment in new intermittent renewable generation across New Zealand," the company said in the NZX announcement.
"The battery will support new wind and solar on an intra-day and intra-week basis and ultimately reduce reliance on gas peakers as Contact transitions to a low-carbon future."
