Hitachi Energy has been awarded the contract to build major components for the Darwin-Katherine Battery Energy Storage System.
"The cutting-edge technology in our battery energy storage system will reinforce the NT as the solar capital," Chief Minister Michael Gunner said on Monday.
"The (big battery) will store power and be the backbone of the Darwin to Katherine electricity grid which keeps the lights on for 150,000 Territorians."
The 35 megavolt amp battery is expected to cost $45 million and fully pay for itself within five years by delivering a $9.8 million per year cost saving.
It will be built and located at Territory Generation's Channel Island Power Station.
The battery is the first step towards reducing the use of gas generators to power the Darwin to Katherine grid.
"Hitachi Energy's battery energy storage solution will be part of an intelligent electrical ecosystem and ensure full utilisation of solar energy generation and less reliance on fossil fuels," Hitachi Energy Australia director Bernard Norton said.
It is expected to help reduce carbon emissions in the NT by about 58,000 tonnes per annum.
It will also help stabilise the power supply by smoothing fluctuations associated with solar energy.
Construction will commence in 2022. The system is expected to be operational in 2023.
Territory Generation is an NT government corporation that owns and operates eight power stations.
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