Collie is home to Western Australia’s biggest state-owned battery. (ABC News: Mya Kordic)
Western Australia's economic watchdog has put the owners of the state's big batteries on notice amid "unusual" behaviour that appears to have been driving up prices in the market.
Economic Regulation Authority (ERA) chair Steve Edwell confirmed the agency had been investigating the pricing activities of batteries in the WA market, known as the wholesale electricity market, or WEM.
The inquiries come as scrutiny mounts over the role of WA's fleet of large-scale batteries, owned by state-controlled utility Synergy and French firm Neoen.
It is believed the issue has also caught the eye of the Australian Energy Market Operator.
From practically nothing a few years ago, large-scale battery capacity in WA's main grid has risen to about 1400MW.
Those batteries regularly meet more than 20 per cent of demand for power at peak times and can sometimes provide more than a third.
More pointedly, they are now setting the prices in WA's main grid more than 90 per cent of the time.
Mr Edwell said batteries had rapidly become an instrumental part of the state's power system.
He said the technology had the capacity to deliver significant benefits to consumers by allowing renewable energy to be stored at times of surplus and supplied at times when it was scarce.
But Mr Edwell signalled that those benefits were not guaranteed.
Steve Edwell is the chairman of the Economic Regulation Authority Western Australia. (ABC News: Cason Ho)
"We have been actively undertaking enquiries on these matters, as we always do when we see unusual behaviours or unexpected outcomes in the wholesale electricity market," he said.
Australia is leading the world in the adoption of batteries. But in one state, storage is fuelling some perverse and pricey outcomes.
"Where we suspect non-compliance with the Electricity System and Market Rules, we will investigate and take compliance action.
