Gas in Retreat: How Big Batteries Are Displacing Fossil Gas and Reshaping Australia's Grid

A major structural turning point is underway in the Australian energy market. Fossil gas—long considered the primary fallback for evening peak demand—is officially losing its grip on the grid, yielding its market share to utility-scale battery energy storage systems (BESS).

In its latest June quarterly report, Origin Energy—one of Australia’s largest gentailers—revealed a telling divergence in its energy operations. While electricity sales volumes edged up by 1% over the 2025–26 financial year, gas sales volumes plunged by 17%.

This drop isn't an anomaly. It reflects a fundamental market transformation: large industrial customers are curtailing gas usage, while grid-scale and distributed batteries are taking over the highest-value peak demand hours previously dominated by gas peaking plants.

Here is an analysis of why gas is losing ground, how battery fleets are winning the peak pricing race, and what this means for commercial energy strategies.

⚡ Origin’s Battery Pivot: Replacing Gas with Storage

Origin is actively driving the shift away from gas by aggressively building out its own battery portfolio. The company now has 980 MW / 3,408 MWh of operational storage, with thousands of megawatt-hours more progressing through development and off-take contracts.

Origin's Battery Storage Portfolio

Asset / Project	Location	Capacity	Status / Details
Eraring Battery	NSW	700 MW / 3,160 MWh	Stage 1 (460 MW / 1,770 MWh) operational; $80M expansion underway across four stages.
Mortlake BESS	VIC	300 MW / 650 MWh	Connected to the grid in early 2026; ramping up to full nameplate capacity.
Supernode Battery	QLD	520 MW / 1,858 MWh	Commercial tolling agreement for Stages 1 & 2 with Quinbrook Infrastructure.
Summerfield Battery	SA	240 MW / 960 MWh	Secured via a 10-year off-take agreement.
Northern Tablelands	NSW	800 MW / 1,000 MWh	In pipeline (combined wind and battery development).

"The addition of significant battery storage capacity has materially strengthened Origin’s energy supply portfolio, providing improved flexibility in how we balance supply and demand, manage evening and seasonal peaks, and navigate volatility in the market," stated Origin CEO Frank Calabria.

📉 Rystad Energy Analysis: Batteries Capture the High-Value Hours

A concurrent market report from Rystad Energy underscores exactly where batteries are displacing open-cycle gas turbines (OCGT).

While coal still provides a significant portion of bulk energy, batteries have captured the intraday morning and evening peak demand windows. In June alone, battery discharge reached 360.7 GWh across the National Electricity Market (NEM)—effectively matching OCGT generation during the coldest month of the year.

Furthermore, between November 2025 and May 2026, battery generation consistently exceeded OCGT output across the NEM, keeping average spot prices in a moderate band of $53/MWh to $77/MWh.

By soaking up midday solar generation and discharging during sunset, battery storage is suppressing peak wholesale price spikes, dismantling the business model for expensive gas peakers, and reducing routine gas demand across the power sector.

📍 What This Means for Commercial & Industrial Energy Users

The retreat of gas and the rapid dominance of BESS signal a permanent change in how commercial electricity contracts and on-site generation should be structured:

• Gas Peaker Economics are Broken: Relying on gas peakers to manage grid volatility is becoming financially unviable. As gas generation shrinks, commercial facilities exposed to spot price tariffs must adapt to battery-driven price profiles.

• Time-of-Use Optimization: With batteries flattening evening peak spikes, commercial facilities can leverage Behind-the-Meter (BTM) energy storage to capture low daytime rates and discharge during peak hours, creating a direct hedge against retail price volatility.

🚀 De-Risk Your Storage Assets with EServices4U

As battery storage replaces traditional thermal generation, successfully deploying commercial BESS assets requires deep technical engineering and independent financial verification.

At EServices4U, we serve as your dedicated Owner's Engineer, providing end-to-end technical and commercial advisory across Australia:

• Design Validation & Grid Compliance: We perform rigorous OpenSolar design audits and verify Single Line Diagrams (SLDs) to ensure your solar and BESS assets meet strict distribution network (DNSP) compliance standards.

• Commercial Advisory & Fixed-Fee Pricing: We protect your capital through transparent, fixed-fee engineering review models that eliminate unexpected EPC costs.

• KPO & BPO Data Operations: We deliver specialized back-office data management and Knowledge Process Outsourcing (KPO) to monitor battery yield, track long-term OPEX performance, and streamline asset management.

Capitalize on Australia's battery transformation and secure your commercial energy advantage today.

🌐 Website: eservices4u.com.au

📧 Email: growthpartner@eservices4u.com.au