The Australian Renewable Energy Agency has announced that all 12 of the projects that won funding under its large-scale solar program have now reached financial close and will begin construction shortly, if they haven’t already.
The last of the 12 projects to get to financial close – the 20MW White Rock solar farm in northern NSW – did so late last week. Funding was never really in doubt considering that the project is owned by Chinese giant Goldwind, which is building a 175MW wind farm by the same name at the same place.
ARENA, however, used the milestone to hail its $90 million initiative as a huge success, helping to bring down the cost of large-scale solar to the level of wind energy – and five years ahead of what had been expected.
The 12 projects have also benefited from $320 million in low-cost finance from the Clean Energy Finance Corporation, as the country’s major banks tried to wrap their mind around this new technology.
But there is every sign that they have, and have lowered the risk quotient on their financing, at least for those with long-term power purchase agreements. While the ARENA program will deliver 490MW of large-scale solar, another 1,500MW is thought to be also under construction, or about to begin, around the country.
“This competitive round is the perfect demonstration of how ARENA is accelerating Australia’s shift to a low emission, renewable energy future,” Frischknecht said in a statement.
“From zero to more than 20 plants in five years, Australia’s large-scale solar industry has grown at a tremendous pace thanks to concerted efforts by ARENA and the CEFC.
“We know of at least six new plants that are being developed without any ARENA grant funding support.”
He said the ARENA program had unlocked $1 billion in investment from other sources and regional economies would benefit, with an estimated 2,300 direct jobs and thousands more indirect jobs expected to be created by these plants.
Frischknecht said planning, developing and financing large-scale solar projects remained a complex task involving multiple different parties. That’s why the knowledge gained from the project is so valuable.
“ARENA believes in the power of shared knowledge. That’s why we require project developers to share the learning from each stage of development, construction and connection with the renewable energy sector,” Mr Frischknecht said.
“Our support for Whitsunday Solar Farm assisted project developer Edify Energy to secure debt finance for two additional plants, Hamilton Solar Farm in Queensland and Gannawarra Solar Farm in Victoria. ARENA is benefitting from knowledge sharing activities across the three projects.”
The projects are expected to be completed between late-2017 and mid-2018, and will help reduce wholesale prices in all three states where these projects will be built when they come on stream.