NSW is to hold more and bigger auctions for wind, solar and long duration storage in coming years, as part of an ambitious new “stretch” target for capacity laid out by the state’s consumer trustee.
ASL, formerly AEMO Services, on Monday published a new infrastructure roadmap with new targets and an ambitious timetable of capacity auctions, which it says are necessary to ensure wholesale prices stay as low as possible as the state’s ageing coal fired power stations retire over the next decade.
It says the previously announced target of securing a minimum 12 gigawatts (GW) target of new wind and solar by 2030 has now been lifted to 16 GW, while the 2034 target for long duration storage has been jacked up to 42 gigawatt hours (GWh) from the previous target of a minimum 28 GWh.
NSW currently has around 7 GW of wind and solar capacity in operation, from around 50 different projects, and another 50 projects reflecting another 13 GW of capacity have received development approvals.
CEO Nevenka Codevelle admits the new targets are ambitious, and will require a step change in how proponents and the broader industry accelerate development, and she said ASL is now calling for quality early stage projects that can be fast-tracked to completion.
“16 GW of renewable generation in NSW by 2030 will require projects to progress through the development pipeline approvals, financing and construction processes much faster than has been achieved in the past,” Codevelle says in the report.
Much of the early capacity for NSW is to be meet through the federal government sponsored Capacity Investment Scheme, but once its allocation of 7.1 GW is met – likely at the end of this year, but possibly early in 2026 – ASL says it will hold a series of state-based tenders.
The size of these generation tenders – four of them will be held over 2026 and 2027 – will be boosted to 7,000 gigawatt hours per annum, reflecting a capacity of around 2.5 GW, depending on the mix of wind and solar.
From 2028, and into the 2030s, there will be further tenders amount to 4,600 GWh per year, or around 1.6 GW of new capacity. Sizes may vary according to the quality of the bids in any particular tender.
The scale of this increased ambition is reflected in the graph below.
The NSW government recently announced a tender for 500 MW of “firm capacity” targeting the major load areas around Sydney, Newcastle and Wollongong, and ASL confirms that this will be held in the December quarter this year, with further details to be announced.
ASL also proposes to hold large tenders for long duration storage infrastructure in 2026 and 2027. The LDES tenders are defined as eight hours or more, and the three held so far have awarded contracts mostly to battery storage projects, but also to an advanced compressed air storage facility at Broken Hill, and a pumped hydro proposal.
ASL says storage tenders will be open to projects still in their pre-development phases, as long as they have had a response to a connection enquiry and obtained a Secretary’s Environmental Assessment Requirements (SEARs).
The tender plans were released as ASL released two new reports looking at the 20-year investment horizon for NSW, the 2025 Infrastructure Investment Objectives (IIO) report and an inaugural NSW Generation Investment Outlook (NSW GIO).
NSW currently has the biggest coal generation fleet in Australia, pipping Queensland with total capacity of more than 8 GW. But while the planned closure of the biggest, the 2.8 GW Eraring facility, was put back at least two years to 2027, the new ASL modelling contemplates all four remaining coal generators shutting down by 2034.
The GIO report identifies what it describes as a “healthy pipeline” of more than 50 GW of proposed wind and solar generation capacity in NSW, including the 12.5 GW of projects already with development approval.
“There is sufficient capacity in the pipeline to meet the minimum objectives,” its says. But adds: “Current project lead times won’t be fast enough to meet the 16 GW ambition unless roadblocks are addressed.”
Those bottlenecks include the development pipeline, from community support and planning approvals through to road infrastructure and workforce limitations, transmission delays, as well as bottlenecks in supply chains and the complexity from the sheer scale of the energy transition.
Codeville says ASL is calling on developers to bring forward early stage projects.
“What we’re finding now is that to maximise consumer benefits, we need to target a greater infrastructure build both before and after 2030,” she says. The report puts those benefits at $6.8 billion over the next 20 years.
“From our inaugural NSW Generation Investment Outlook (NSW GIO) we know interest in the project pipeline and investment exists, but the pace of development needs to increase.
“It’s our job as the State’s independent Consumer Trustee to use the IIO report and our tenders to help meet this challenge.”
