Switching gears, we move to vanadium. Graham Arvidson, who's the CEO of Australian Vanadium Limited. Graham has over two decades of experience in key leadership roles, including project studies, design, construction, commissioning, and operations management across Australian and international resource and energy sectors. Prior to being appointed CEO of AVL in 2022, Graham held key leadership roles with IGO, Primero Group, and Pilbara Minerals, where he established a track record in successful project development, operational turnarounds, and optimization of mineral processing operations. Graham's combined energy and metals background matches AVL's pit to battery strategy, providing a unique skill set to create shareholder value as the global energy transition towards decarbonization and the electrification accelerates. Graham, the floor is yours.
Thanks, Andrew. Just a quick comment. It's hugely privileged to be here. Speaking after Simon Larson, as a bit of a groupie of Simon Larson, a big privilege, as a quick story of what diggers and dealers can do, and I think is the essence of good leadership in our industry. When I was in a much more lowly state in the industry, I bumped into Simon Larson in a pub. At that time, he would have been a rock star, and he took the time to show interest in me as a person and how I could make an impact in the industry. I think just to elaborate on his story, that's really what we want to see more of. My journey has certainly put me across lots of people like Simon. We need more of it. Today, I'm here to talk to you about a wonderful story.
It's not gold, but I think for reasons I'll get into, it's something you should really pay attention to right now. I'm going to start with a bold statement, which is a true statement. The energy transition is going to come to a grinding halt unless we do something about long-duration energy storage. That term may not be on everyone's minds, but I'm here to say it should be right now. It is no longer a luxury. It's a necessity. Long-duration energy storage is a story of vanadium. Vanadium can play a key role in that. Today, I'm going to talk about policy settings, why that's really important, and why vanadium can play a competitive proven role in enabling the next steps of the energy transition.
At AVL, importantly, we are ready with a full supply chain solution to deliver into that opportunity, a massive addressable market, whether you're in the resource sector, data centers, or grid-connected applications. Every single one of those addressable markets are moving beyond the four-hour mark, which is the important piece for us. Policy setting matters, and I'll share one live example in real time that I think is telling and should make people pay attention to not just long-duration storage, but the vanadium story. In the United Kingdom, a place where you'd probably least expect this to happen, they've put out very prudent policy. In that policy, they've done specifically long-duration energy storage, and they've specifically said this needs to be for the long term. 25-year assets are the only thing going to be considered for the cap and floor pricing mechanism being contemplated. Eight-hour batteries, importantly.
I think illustrative of what vanadium flow batteries can bring to the table, in the most recent tender under that new policy setting, existing deployers who've successfully deployed lithium-ion batteries into grid-scale technologies, what did they put in the tender? Vanadium flow batteries. 2.4 GWh of vanadium flow batteries were tendered into the most recent tender. To put it out in vanadium terms, that's 8% of the world's vanadium supply. That's one tender process in one country. This is happening all over the world. Variable renewable energy penetration is increasing to that point where longer and longer duration technologies are needed, and they need to be competitive and sustainable. That's what vanadium brings to the table. Meanwhile, we have 30 GWh of pipeline being built out in China in terms of vanadium flow batteries, the largest vanadium battery in the world, 1 GWh , went operational two months ago.
In lockstep, China is commissioning 35 GWh of full supply chain solution. That would imply doubling or quadrupling the vanadium industry in the next five years, depending on what view you take. Pay attention to vanadium, but more importantly, pay attention to vanadium batteries and the supply chain benefits. Importantly, policy setting does matter specific to Kalgoorlie. I'm here today to talk very specifically about Kalgoorlie because this is going to play a very important role in the next steps of the energy transition because we're going to unlock vanadium flow batteries as a proven competitive technology delivering value here in Kalgoorlie. The government recently committed AUD 150 million of funding for specifically a battery here in Kalgoorlie. That's a 500 MWh, 10-hour battery, long duration. Importantly, the main purpose here is to improve the security of the grid. We all know that's an important facet.
Equally, the government is not focused just on unlocking security of the grid. That's the baseline. What we're interested in here, and I'm going to quote Roger Cook, I want this project to be a catalyst to drive a new vanadium mining and processing and export industry for WA. I think that's telling. This is about a lot more than just one battery, and long duration and economic diversification are at the center of the state's policy and indeed the national policy. Our business is ready to go with the supply chain that can provide the perfect solution to projects like Kalgoorlie VBESS . On the upstream, we continue to do the heavy lifting to complete an optimized feasibility study that brings together the two large projects that we merged recently.
We're also making headway on the heavy lifting to finish all of our remaining primary approvals. Just last week, we received a major approval for our process plant near Geraldton, which is the development application approval, and it paves the way for us to unlock our processing hub near Geraldton. In the midstream, we're the only established electrolyte producer. We have a commercial production facility here in Perth. We've successfully deployed vanadium electrolyte in operating batteries with Horizon Power. That gives us the track record. It gives us the midstream component to delivering a battery like Kalgoorlie BESS , and it allows us to have a scalable platform to deliver into our downstream business. On the downstream side, we've successfully deployed operating batteries, most recently with Horizon Power. They've publicly said it has exceeded expectations.
A wonderful outcome, especially when it's operating in Kununurra, where they've intentionally put it in use without any cooling systems in the hottest, most unhospitable climate they can put it into, and it's still exceeded expectations. At the same time, in the last 12 months, we've worked hard on what we call our Project Lumina architecture. That is just simply taking what they do in China at gigawatt-hour scale and asking ourselves, what is the off-the-shelf solution to make sure this is ready to go in Australia with Australian engineering, Australian contractors, Australian content? What's the lowest cost way to do that? That's what we're ready to do and what we think positions us so well to make an offering into the Kalgoorlie battery. Why are vanadium flow batteries being taken up? Of course, it's economics as the primary driver.
The reason being, the longer the duration, the more economic they become against other technologies. Likewise, they don't degrade. You can put a battery into use today, and you can have it in operation 50 years from now, and you can have a battery operating at full capacity. All the other benefits of the battery can also come into play, which will continue to see them be adopted. Ultimately, long-duration energy storage is what's going to drive the uptake now. The makeup of vanadium battery and in particular context of the Kalgoorlie VBESS is important. What AVL can bring to a solution like this is electrolyte production that is roughly 50% of the value of the battery. Of course, we're the only established producers of electrolyte in Western Australia.
In terms of the remainder, all very straightforward things we do in Western Australia all the time, with the exception of power stacks. I would like to say, if ever there was a battery industry to be localized in terms of supply chain in our great country, it certainly is vanadium flow batteries in that it is tanks, pumps, piping, and power stacks, all of which are easily manufactured in this country and can be done cost-effectively. In terms of the state policy, again, I'm crapping on about policy and federal policy, we are poised to see this uptake just as the addressable market for long-duration where vanadium batteries are more economic and play best.
I'm pleased today to share that we've shared correspondence on Friday with Minister Amber- Jade Sanderson, the Energy Minister for WA, stating that they acknowledge AVL's early leadership in unlocking this supply chain, including progress on upstream vanadium processing and work to develop the domestic battery supply chain. Our integrated approach aligns well with the government ambitions. I think that's a critical endorsement of what we've done at a time where people may have questioned why a traditional mining company is pursuing a full supply chain solution. It's because it makes cost-effective sense and it delivers the outcomes that align with policy. Furthermore, Minister Sanderson gave an update on the Kalgoorlie VBESS, and I'm proud here today to deliver that update to the group in Kalgoorlie. The Kalgoorlie VBESS will be tendered competitively very soon.
Importantly for us, the facets of that tender will include obviously inclusion of competitiveness and value, but also readiness, which is what we bring to the table, and contribution to Western Australia's vanadium industry. Importantly, our local supply chain solution should be able to bring a compelling offer to that proposition on all points. These batteries take time to build. The target is 2029. Importantly, what I'd like to highlight is we bring an 18-month lead time doing the detailed design of what one of these batteries look like. We bring proven electrolyte capability that we can scale immediately. What we can bring in terms of value is an opportunity to compress that schedule and give certainty of delivery into the gold fields where we all know the grid needs an improved solution and multiple solutions. Do not forget about the vanadium.
Of course, this battery in Kalgoorlie would be 2% roughly of the world's vanadium supply. There is a 1.6 GWh battery going into construction in Switzerland. That would be some 4%- 5% of the world's vanadium supply. The tender I spoke about in the United Kingdom would be 8% of the world's vanadium supply. I hope you can understand that it just takes a small handful of grid-connected batteries to make a huge impact on the demand side of the vanadium curve. Do not forget that. Shamelessly quoting Premier Cook, Western Australia of itself is going to have a strong demand for vanadium as part of our domestic market. That is not an overstatement. Whether you are in the resources sector, data centers, or grid-connected applications in the Swiss or the NOWIS, all of these sectors need to take the next step with 6, 8, 10, and 12-hour batteries.
This becomes compelling at that point. Western Australia itself needs a lot of this. The upstream is important to us. With a low vanadium spot price, perhaps people are overlooking the opportunity here to have a shovel-ready project in the near term. We continue to do the heavy lifting and the hard work. We are very grateful that we continue to have the support of a federal grant to do a lot of work moving that through the permitting processes to the point of being shovel-ready. We are nearing the completion of our optimized post-merger feasibility study. In summary, what we bring to the table is, yes, vanadium upstream capability in the near term. I hope I made the case that vanadium is a metal that is perhaps overlooked right now and should be on people's minds. We are at the cusp of the long-duration transition.
I hope I made the case that even the United Kingdom has adopted policies that are making it very attractive to take up vanadium flow batteries for long-duration storage. AVL has a ready-to-go supply chain solution across the full value chain. We can right now deliver greater than 70% local content into our supply chains, and importantly, at a competitive lifecycle cost. Already with lithium at four hours, we are competitive. The Lumina VFB architecture and our electrolyte capability being ready to go matters. Our partners, the funding and delivery partners that are ready to work with us on Kalgoorlie will make sure that we can deliver a value proposition there. Getting access to that wonderful flagship project, the AUD 150 million funding supporting it that should ensure positive economics, is vitally important to us. We intend to put all our energies into that.
Please join us as we seek to unlock Australia's long-duration energy future. Thank you very much.