The Australian state government of New South Wales has announced the successful projects in its first tender under the Electricity Infrastructure Roadmap. Developers are building two large solar farms, a wind farm and an eight-hour battery energy storage system to manage the phase-out of coal-fired generation from the state’s grid.
AEMO Services, which is managing the tender process as the New South Wales consumer commissioner, said the four projects, with an investment of A$2.5 billion ($1.66 billion), will generate nearly 1.4 GW of capacity, while the large battery will supply at least eight hours 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 720MW New England Solar Farm and proposed the 400MW Stubbo Solar Farm, while Goldwind Australia won the 275MW Coppabella wind farm in the southern Tablelands region.
Germany’s RWE Renewables has also secured support to build a long-term lithium-ion battery energy storage system with a storage capacity of at least eight hours. The 50MW/400MWh large battery will be built next to the company’s existing 249MW Limondale Solar Farm near Balranaldi in the state’s south-west.
AEMO Services Executive General Manager Paul Verschuer said that together the successful projects would provide enough electricity to power 700,000 homes and represent a total investment of more than $2.5 billion in New South Wales’ renewable energy infrastructure.
Verschuer said the tender was supposed to support about 950MW of new generation at about 2,500GWh, but the total was exceeded “due to the quality and value of the bids”.
All in all, the tender will support 1,395 MW of capacity, which includes 4,009 GWh of production and an eight-hour battery.
“There is clearly a strong appetite for private sector investment in generation, storage and consolidation, which will take advantage of the huge economic opportunities of the energy transition, and we are encouraging investment through this tender,” he said, adding that all the projects “have comprehensively demonstrated their economic value to (New South Wales) electricity consumers and benefits to their host communities.”
Successful projects have been awarded Long Term Energy Service Agreements (LTESAs), providing developers with income security and helping to accelerate a new wave of new large-scale energy infrastructure as the NSW Government looks to implement its Electricity Infrastructure Roadmap.
Launched in 2020, the Roadmap outlines a path to bring at least 12 GW of renewable energy generation capacity and 2 GW of long-term storage online by 2030 as the state prepares to phase out its aging coal-fired power plants. The auctions are planned to be held twice a year at least until 2030, in order to build enough renewable capacity to support the transformation of the state’s energy system.
ACEN Australia CEO Anton Rohner said LTESAs enable greater investment certainty for companies like ACEN.
“LTESAs will help drive investment in renewables and storage capacity, which are essential to accelerate the transition to clean, reliable and most importantly, affordable electricity for Australians,” he said. “LTESAs provide rights to receive a minimum price for generation projects over a 20-year period, protecting 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 achieved 4.1GW of its statutory renewable energy target of 12GW by 2030, making it a third of the way there.
“The transition to clean renewable energy in NSW is essential and underway,” he said. “These projects will fill the gap left by the planned shutdown of coal-fired power plants in the coming decade.”
AEMO Services expects the selected projects to be operational and connected to the grid as early as 2025.
AEMO Services said projects would still be subject to normal planning approval processes, including community consultation, but social licensing criteria – including community benefit sharing, employment and workforce development, local supply chain development and land use – were part of the bid evaluation.