Victoria's biggest energy supplier, AusNet, has begun trialling an electricity storage system it hopes will help prevent blackouts during hot summer days when demand is at its peak.
A one-megawatt grid energy storage system, made up of batteries housed inside four shipping containers in a lot in Thomastown in Melbourne's north, will be trialled over the next two years.
At full power the batteries can provide one hour of electricity to up to 300 homes.
AusNet said the project would cost $5 million and was the first trial of this type and scale in Australia.
The batteries could be relocated to areas where additional power demand was expected and could assist AusNet in better managing demand.
In January last year Victoria suffered through one of its worst heatwaves on record, with many homes across the state losing power due to faults and overloading.
If electricity demand outstrips supply, providers often opt to deliberately cut power in some areas, known as "load shedding", to reduce pressure.
Jonathan Geddes from AusNet Services said they were testing whether the system could supply enough energy on hot days.
"This is an Australian first trial using a network battery to provide additional support into the electricity grid to manage the network stresses of the peak demand days," he said.
"We hope it will offset or delay network investment which is good news for customers.
"We believe in the future we'll be able to relocate the batteries to power lines that are constrained on peak demand days to guarantee that customers receive safe and reliable power without upgrading the local power lines."
Dr Roger Dargaville from the Melbourne Energy Institute at the University of Melbourne said this type of system could eventually make it cheaper for consumers.
"Energy storage is a really interesting development in the energy system," he said.
"As the cost of storage comes down and electricity goes up – if we hit that crossover point - then storage is really likely to take over.
"The system is ripe for revolution. We've built a system that is catering towards just one or two high peak demand days but ... average demand is actually declining."
"If we can work out a way to smooth those peaks or supply energy through storage and minimise the amount of generation we need, then we can develop a cheaper system for everyone.
But Dr Dargaville said the trial would not have much effect on the current energy capacity.
"One megawatt is tiny – this is very much a pilot project," he said.
"We have to upsize this many, many times over and you would need 100 times, 1,000 times more than this in the system to have it make a real difference."
(This news story is from ABC News)