In its South Australian Power for South Australians plan, state premier Jay Weatherill laid out a series of measures to increase his administration's role in the energy sector.
They include A$150 million ($113 million) for the South Australia Renewable Technology Fund to develop the country's largest energy storage site.
The 100MW project will be used to store wind and solar energy, the government said.
The programme also includes a new gas-fired power plant and plans to tender 75% of the government's energy needs over the next decade.
"South Australians have been let down by a broken national energy market that puts profits before people. Our plan will restore security and put downward pressure on prices," Weatherill said.
"South Australia will now lead our nation's transformation to the next generation of renewable storage technologies and create an international reputation for high-tech industries," he added.
The announcement comes in the middle of a debate in Australia over the use of battery storage in its energy network. Technology mogul Elon Musk offered South Australia to fix South Australia's energy system in 100 days using battery storage or to give the money back.
South Australia has suffered blackouts in recent months, usually as a result of storms damaging grid infrastructure – although some politicians have blamed renewables' influence on the grid.
In early March, developers Neoen Australia and Megawatt Capital completed financing for the 109MW third phase of the Hornsdale wind complex in South Australia.
Hornsdale 3 will be the cheapest of the three stages, supplying power at A$73/MWh (US$56/MWh).
This is a 21% fall on the A$92/MWh price agreed for Hornsdale 1 in 2015 and a 6.5% fall on the A$77/MWh agreed in January 2016 for Hornsdale 2.