A major fault in New South Wales’ largest battery project has forced a delay of up to a year and could push up wholesale electricity prices while repairs are completed.

Akaysha Energy, the BlackRock-backed developer behind the $1 billion Waratah Super Battery, said two large transformers were damaged during final testing, pushing the project’s completion from late 2025 to 2026.

Transformers are essential for converting electricity between voltage levels so it can move efficiently through the grid. Without them, large-scale storage systems like Waratah cannot connect or discharge power.

The company said the fault occurred during the final stage of commissioning as the battery’s control systems were being synchronized with the state grid. Despite the issue, the battery continues to operate at 350 megawatts.

“The Waratah Super Battery is still operating and actively bolstering energy security for NSW’s grid,” Akaysha said.

The 850-megawatt system, located about 100 kilometres north of Sydney, was designed to power roughly 150,000 homes for an hour and act as a “shock absorber” for the electricity network. Analysts said the outage could contribute to higher power prices in 2026, particularly during winter when demand peaks and coal plants face breakdown risks.

Industry experts warned that replacing the damaged transformers could take time, as high-voltage units are in global short supply. “Getting a like-for-like replacement might be difficult as it is not a common network voltage,” said EnergyEdge managing director Josh Stabler.

The delay highlights the challenges of Australia’s renewable energy transition. Large batteries are crucial for balancing solar and wind power, yet they depend on complex systems that can be prone to faults.

The setback also comes as NSW continues to rely heavily on coal. The Eraring power station, originally due to close this year, will now remain open until at least 2027.

Located on the site of the former Munmorah Power Station, the Waratah Super Battery required extensive grid upgrades, including work on 22 substations and four transmission lines by network operator Transgrid. Despite the delay, the project remains central to the state’s long-term energy security plans.