Hong Kong real estate fund backs $2 billion of battery and solar projects in Australia

Renewable energy and battery storage developer Maoneng Group has partnered with a Hong Kong-baed real estate fund manager to secure finance and accelerate some $2 billion of big battery and utility scale solar projects in Australia.

The deal with Gaw Capital Partners – described as a private equity firm specialising in real estate and “high barrier to entry” markets – will create a new joint venture company, majority owned by Gaw, to help secure equity and debt financing for 1.9GW of big battery and solar projects in Victoria, NSW and South Australia.

The first project to be rolled out is the 240MW, two hour storage (480MWh) Mornington battery in Victoria, which has already received development and connection approvals, and is expected to start construction early next year.

Other projects include the 225MW/450MWh Gould battery project just north of Adelaide in South Australia, which has also gained development approval.

Maoneng also another three battery projects in NSW linked with its agreement to supply AGL with up to 400MWh of storage – at Tamworth, Lismore and Armidale – as well as the recently announced Merriwa hub, which proposes up to 550MW of solar and 1600MWh of battery storage in the Upper Hunter region of NSW.

The deal with Gaw appears to be a significant step forward for Maoneng, which has seen its Mugga Lane solar farm in the ACT put in the hands of receivers, and whose small stake in the 200MW Sunraysia solar project suffered from project delays and ongoing disputes over claims for liquidated damages.

Batteries key to renewable energy transition

“We are very excited to partner with Gaw Capital in building out our renewable energy portfolio, including six battery storage projects,” said Morris Zhou, the Maoneng chief executive who will lead the new joint venture company Gaw Maoneng Renewables.

“The transition to renewable energy in Australia is accelerating under this government’s policy, and batteries are a key piece to the puzzle in facilitating higher grid penetration by solar and wind. The partnership allows us to focus on the job and to get it done sooner.”

Gaw says it is making the investment in the new joint venture through its growth equity arm, Gaw Growth Equity Fund I, and says it has been looking for an opportunity to enter the Australian market.

“We have been looking for some time at a suitable entry into the clean energy investment sector, and utility-scale batteries underpin the dispatchable energy requirements for the grid to transition from its mix from coal and gas to renewable energy generation,” said Herbin Koh, Gaw Capital’s head of venture and growth equity.

“We are pleased to work with Morris and the Maoneng team to lead the way and expect to expand GMR significantly in the coming years through the development and investment in renewables.”

Christina Gaw, the managing principal and head of capital markets at Gaw Capital, said its institutional investors had shown growing interest in the clean energy and ESG space in Asia and Australia.

“We are very pleased with the opportunity to back one of the largest energy infrastructure investments in support of Australia’s energy transition away from fossil fuels.”