Coal hub inks deal to source 100 pct of its power from solar and battery being built by global oil giant

Newcastle Coal Infrastructure Group (NCIC), the owner of one of Australia’s biggest coal export terminals, has inked a deal to run its New South Wales Hunter region operations entirely on renewable electricity, sourced from a massive solar farm being built nearby by Lightsource bp.

NCIC said on Sunday that it had signed a power purchase agreement (PPA) for clean energy from the Goulburn River solar farm, a 585 megawatt (MW) project that commenced construction near Merriwa, NSW, in December of last year.

The “firmed renewables” project is being developed by Lightsource bp – the fully owned renewable energy arm of oil major bp – as hybrid generation and storage project, with an eight-hour battery expected to be added sometime before 2026.

NCIC says the PPA for Goulburn River will supply solar at a volume to achieve 100% renewable energy for its Kooragang Island facility from 2030 onwards – and marks a “key step forward” in the group’s commitment to “operational net zero.”

“This PPA not only secures long-term pricing for our energy needs but also paves the way for other businesses in the region to make similar commitments toward a cleaner, more sustainable future,” NCIC CEO Aaron Johansen said in a statement.

“[Lightsource bp’s] expertise in renewable energy, combined with the shared vision for sustainability, has been instrumental in getting us to this point,” Johansen said.

For Lightsource bp, the Goulburn River PPA follows the news that the solar and battery developer’s parent company is slashing investment in clean energy, from a planned $US30 billion out to 2030, to around $4 billion, and redirecting funds back into fossil fuels.

This abrupt change of focus looks unlikely to affect Lightsource bp much, although bp now plans to bring a strategic equity partner back in to the picture, less than two years after taking full ownership, to “further grow and optimise the platform as a standalone joint-venture.”

The fact is that Lightsource bp has been a new energy success story, delivering double-digit equity returns, building more than 2GW of solar projects under budget in 2024, and developing strong battery storage capabilities.

Since its entry into the Australian market in 2018, Lightsource bp has developed and financed more than 1.2GW and is working up a solar and battery portfolio of more than 7.5 gigawatts (GW) across Australia and New Zealand.

The Goulburn River solar farm is a particularly important project for the company, being one of the largest approved single solar farms in NSW to reach shovel-ready status to date. It is also one the winners of federal Labor’s Capacity Investment Scheme (CIS), announced at the end of 2024.

Lightsource bp had already secured a Long-Term Energy Service Agreement (LTESA) in late 2023 from the NSW government to provide one of only three eight hour battery projects in the country.

In December, Lightsource bp chief operating officer for APAC, Adam Pegg described the Goulburn project, alongside the Woolooga solar and BESS project the company is developing near Gympie in Queensland, as examples of “exceptionally well-designed” and complete power solutions.

“While there’s ongoing debate about the role of nuclear, the reality is that we have solutions today for firmed renewables – wind and solar backed by batteries – which are already proving to be the most cost-effective and reliable energy solution,” Pegg said.

“These projects set a new benchmark for how we approach all future developments, demonstrating how market-driven innovation can deliver cost-effective solutions that meet growing energy demands.

“By embracing firmed renewables, we can build a modern energy grid that is cleaner, more resilient, and capable of powering the nation’s growth, driving both economic progress and sustainable development in a rapidly changing world.”