AEMO Services, which is administering the tender process in its capacity as New South Wales Consumer Trustee, said the four projects, worth AUD 2.5 billion ($1.66 billion) of investment, will deliver almost 1.4 GW of capacity, while the big battery will deliver at least eight hours of continuous discharge of stored electricity.
AEMO Services, an independent subsidiary of the Australian Energy Market Operator, has announced successful projects under the Electricity Infrastructure Roadmap. AC Energy's Australian unit is building the 720 MW New England Solar Farm and proposed 400 MW Stubbo Solar Farm, while Goldwind Australia won with the 275 MW Coppabella Wind Farm in the southern Tablelands region.
Germany'S RWE Renewables has also secured support to build a long-duration lithium-ion battery energy storage system with at least eight hours of storage capacity. The 50 MW/400 MWh big battery is to be built beside the company’s existing 249 MW Limondale Solar Farm near Balranald in the state’s southwest.
AEMO Services Executive General Manager Paul Verschuer said that together, the successful projects would deliver enough electricity to power 700,000 homes and represent more than $2.5 billion in total investment in New South Wales' renewable energy infrastructure.
Verschuer said the tender was due to support about 950 MW of new generation, with an output of about 2,500 GWh but the total was exceeded “due to the quality and value of the bids.”
In all, 1,395 MW of capacity will be supported under the tender, involving 4,009 GWh of generation, as well as the eight-hour battery.
“There is clearly a strong appetite for private sector investment in generation, storage and firming assets which capture the enormous economic opportunity of the energy transition, and we’re incentivising that investment through this tender process,” he said, adding that all the projects “have comprehensively demonstrated their financial value to [New South Wales] electricity consumers and benefits to their host communities.”
The successful projects have been awarded long-term energy service agreements (LTESAs) that will provide revenue certainty for the developers, helping to accelerate a new wave of new large-scale energy infrastructure as the NSW government looks to implement its Electricity Infrastructure Roadmap.
The Roadmap, launched in 2020, sets out a path to bring at least 12 GW of renewable energy generation capacity and 2 GW of long-duration storage online by 2030 as the state prepares for the exit of its ageing coal-fired generators. Auctions are to be held twice a year until 2030 at least to ensure enough renewables capacity is built to support the transformation of the state’s energy system.
ACEN Australia Chief Executive Officer Anton Rohner said the LTESA’s will allow for greater investment certainty for businesses like ACEN.
“The LTESAs will help encourage investment in the renewables and storage capacity necessary to accelerate the transition to clean, reliable and more importantly, affordable power for Australians”, he said. “The LTESAs offer the rights to access a minimum price for generation projects over a 20-year timeframe, which protects investors like us from the risk of unexpectedly low wholesale electricity prices.”
NSW Energy Minister Penny Sharpe said the new generation supported by this tender process meant NSW had now locked in 4.1 GW of its legislated 12 GW of renewables target by 2030, so was one-third of the way there.
“The transition to clean renewable energy in NSW is essential and underway,” she said. “These projects will fill the gap that will be left with the planned closures of coal-fired power stations in the coming decade.”
AEMO Services expects the selected projects to be operational and connected to the grid by as early as 2025.
AEMO Services said the projects remain subject to normal planning approval processes, including community consultation, but social licence criteria – including community benefit sharing, employment and workforce development, local supply chain development, and land use – formed part of the tender assessment.
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