CEFC passes 1GW big solar milestone, after backing two new projects

The Clean Energy Finance Corporation has notched up a massive one gigawatt of big solar investment across Australia, after committing another $207 million to two new projects being developed in Victoria and Queensland.

The CEFC announced the major milestone on Friday, alongside its latest investments in the 110MW Wemen Sun Farm in near Mildura, and the 90MW Clermont Solar Farm west of Rockhampton in Queensland.

Both solar plants plants are being developed by German-owned Australian renewables outfit Wirsol Energy.

It said the CEFC’s role of sole debt financier to the two projects – $110 million towards Wemen, and up to $97 million towards Clermont – would allow Wirsol to begin construction on both of them before having secured a Power Purchase Agreement for their generation output.

The Wirsol projects will be built by diversified engineering and infrastructure company RCR Tomlinson, which said on Friday that with the EPC and O&M contracts now executed “and a notice to proceed received,” construction activity would begin immediately.

“With these latest commitments, the CEFC has invested in 20 large-scale solar projects since 2013, becoming Australia’s largest solar investor, supporting projects across Queensland, New South
Wales, Victoria and Western Australia,” the CEFC said in a statement on Friday.

And the achievement is all the more impressive considering a good chunk of the CEFC’s existence was spent fighting for survival, and funding, during the Coalition government’s anti-renewables Abbott-era.

That particular fight more or less came to an end once Malcolm Turnbull took over as Prime Minister, but the party’s entrenched hard right resistance to ambitious renewable energy and climate policies means that the CEFC, alongside ARENA, remains one of the few effective policy levers driving Australia’s shift to low-carbon energy.

“Increasing the amount of renewable energy generation in our electricity mix is essential for the Australian economy to achieve net zero emissions in the second half of the century,” said CEFC large-scale solar lead Monique Miller in a statement on Friday.

“Our investment in large-scale solar continues to play a major role in accelerating Australia’s clean energy transition, with CEFC finance helping to demonstrate the commercial potential of these investments in the ongoing development of Australia’s critical energy infrastructure.”

And according to CEFC transaction lead Niall Brady, the green bank still has a key role to play, despite the momentum Australia’s large-scale solar market has built up over the past few years. Particularly in light of the new policy uncertainty generated by the proposed National Energy Guarantee.

“Australia’s large-scale solar market is maturing, and we are pleased to see growing interest from private sector financiers in refinancing projects once they are contracted and operational, because of
the lower perceived investment risk,” he said.

“(But) there is still a gap in investor appetite for projects that are in the process of finalising Power Purchase Agreements (PPAs), which has the potential to delay construction.

“The CEFC’s role as an ‘interim’ financier is ultimately helping to crowd in additional private sector investment to support the sector’s continued development.”