News: AGL Australia's New South Wales awards $2.5 bln battery contract to Shell

SYDNEY, May 25 (Reuters) - Australia's New South Wales (NSW) state said on Tuesday it has awarded a A$3.2 billion ($2.5 billion) contract to Royal Dutch Shell RDSa.L and renewable energy firm Edify to build a 100-megawatt battery to boost its energy supplies.

Authorities said the battery, to be built by early 2023 and operated by Edify, will ease concerns around energy supply shortages related to the closure of AGL Energy's (AGL) aging coal-fired Liddell power station after two years.

"This battery will help to keep the lights on and keep costs down during peak energy periods, and support more renewable energy to come online," NSW state Energy Minister Matt Kean said in a statement on Tuesday.

Kean said the battery would be built alongside the Darlington Point Solar Farm in the state, one of the largest solar projects connected to the national electricity market.

The decision comes just days after the federal government decided to build a taxpayer-funded A$600 million gas-fired power plant in NSW to offset a looming power shortfall once the Liddell power station shuts down.

Officials said the new contract would begin in July 2022 and run for 10 years.

($1 = 1.2897 Australian dollars)