Early work on Canberra's Capital Battery project began on Tuesday with site preparation under way for the construction of the 100 megawatt large-scale battery.
The project, located adjacent to the Queanbeyan substation in the ACT, will provide the capital with its first large-scale power station when complete in 2023.
International renewables provider Neoen will construct the station which will be a power supply for the region and is designed to back up other power supplies and other power stations in the network.
Neoen's head of development Garth Heron said fundamentally it was exactly the same technology as inside a mobile phone or laptop computer.
"Basically you start with individual cells, which are about the size of a AA battery, and inside of one of these big batteries there's millions of those little cells," he said.
Mr Heron said all those little cells are bought together in big battery packs and modules which are connected to advanced control systems on the batteries.
He said when the sun's shining the ACT's solar panels are generating electricity that will be stored in the big battery and can be delivered throughout the night.
Mr Heron said the current demand for big batteries was driven by the stability they provide to networks due to their remarkable speed.
He said the batteries Neoen operates can go from zero output to full output and then back to zero in the blink of an eye.
"In every electricity system there's always little changes in both supply and demand as energy sources such as solar panels or wind turbines output fluctuates and as users turn off devices," Mr Heron said.
"These batteries are able to respond instantly to that and keep supply and demand balanced."
Neoen committed to building the battery as part of its winning bid in the ACT government's 2020 renewable energy auction.
As part of the winning bid, Neoen is already supplying half of Canberra's renewable energy.
In response to the emerging market for battery services, Neoen increased its original Capital Battery commitment from a 50 MW battery to 100 MW / 200 MWh.
Mr Heron said going to large-scale storage was an important step to increasing the penetration of renewables in the national electricity market.
ACT Minister for Energy and Emissions Reduction Shane Rattenbury said the doubling of battery capacity indicated the confidence in the market.
"This switch to renewable electricity has played a vital role in reducing greenhouse gas emissions in the ACT," Mr Rattenbury said.
"It has also resulted in positioning Canberra as a centre of excellence in renewable energy and stimulated a very welcome level of investment in the ACT."
