Developers shake funding tree for gigawatt scale projects in bid to end big wind investment drought

The owners and developers of two gigawatt scale wind projects are reportedly shaking the tree for equity investors so they can lock in finance and push the green button on their multi-billion dollar plans.

Both projects, the 1.4 gigawatt (GW) Bungapan wind farm and the 1.1 GW Theodore wind farm, are located in Queensland, which is kind of ironic given that the state LNP government has sought to put a stop to the rollout of renewables and even threatened to hold up these two projects last year.

Wind energy has struggled to get financing in Australia over the last year, with only a spate of smaller projects – Waddi, Palmer, Carmody’s Hill and Delburn – reaching FID in the last six months and paving the way for construction to start.

It’s been a long time between drinks for gigawatt scale projects – the only one to be built so far is the 1.32 GW Golden Plains wind farm in Victoria – and Bungaban looks the most likely given it has already secured a significant power purchase deal with Rio Tinto for its giant smelters and refineries in Gladstone.

Australia will need many such projects to reach financial close and get built in coming years to meet its 82 per cent renewables target, although the go-slow in Queensland is making the task harder, despite the enormous take-up or rooftop solar and home batteries.

The $4 billion Bungaban project, which will likely include a significant battery, was the subject of an ownership shuffle earlier this month after Andrew Forrest’s Squadron Energy sold its stake in Windlab to junior parter Federation Asset Management, but agreed to jointly develop Bungaban.

The AFR Street Talk column reports that – despite their respective deep pockets – the two companies have mandated Macquarie Capital to seek additional equity partners to support the investment.

Macquarie Capital has also been mandated, the Street Talk column reports this week, to find equity partners for German energy giant RWE’s 1.1 GW Theodore wind project, located near Gladstone, and also hoping to tap into industrial demand as the Gladstone coal fired power station closes before the end of the decade.

RWE, according to the report, hopes to begin construction of the $3 billion project this year. It had previously announced an MoU with the state-owned power generator Stanwell, including potential investment and off-take agreement.

However, Queensland’s state owned generators have backed away from such deals since the election of the LNP government and its scrapping of the state’s renewable energy targets.

Stanwell has already pulled out of a deal to buy into the Tarong West wind farm, while CleanCo has also abandoned previously announced plans to invest in the Moah Creek wind project.

See: LNP takes credit for Labor wind deals as it boasts of huge oil and gas project pipeline