Wind, solar and battery projects totaling more than 15 gigawatts are vying for a spot on the New South Wales grid, in an impressive response to the first tender for access rights in the South West Renewable Energy Zone (REZ).
NSW energy minister Penny Sharpe says the tender for the South West REZ, conducted by AEMO Services, attracted almost four times the 3.98GW of capacity on offer, while a call for 1GW of long duration energy storage of at least eight hours drew proposals for more than 2GW of projects.
Tender five of the NSW Electricity Infrastructure Roadmap was launched in May, just over a week after the deal to delay the closure of the 2.88 GW Eraring coal fired power station, with competition for a spot in the region and along Project Energy Connect expected to be fierce.
The projects that win access rights are guaranteed a spot in the highly coveted South West REZ and – in principle – are protected against network curtailment, but they must also pay access fees, which will be funneled into the state’s Community and Employment Benefit Program.
The tender for storage, meanwhile, is part of the state’s Long Duration Storage (LDS) program, which seeks a total of 2GW and 16 GWh of storage capacity by 2030, in a bid to fill the gap created by the closure of its remaining coal fired power generators in the coming decade.
AEMO Services’ executive general manager Nevenka Codevelle says the response to the tender has demonstrated the compelling value proposition for the South West REZ.
“From our conversations with investors and proponents, we could see that South West REZ would attract a lot of attention and it’s encouraging that this enthusiasm has been reflected in the slate of proponents who have come forward with bids,” Codevelle said.
Sharpe says the strong competition will help identify those projects that can be built and powered up the fastest, for the best value to NSW electricity consumers, and in a way that best supports local communities.
“The very strong interest in this tender shows that NSW continues to be a leader in Australia’s energy transition and a highly attractive destination for investment in renewables,” the minister said on Thursday.
“The interest means that the best projects can be chosen to provide NSW with affordable, clean and reliable energy.”
Sharpe says EnergyCo, as the administrator of the South West REZ access scheme, will award the access rights in early 2025, on the recommendation of the Consumer Trustee, AEMO Services.
The South West REZ, pictured above, has an intended network capacity of 2.5 gigawatts, but an initial allocation of nearly 4GW is being made available due to the variability of wind, solar and battery projects.
Once the first access rights are dealt out, the state will assess whether further generation capacity can be made available in future tenders within the access scheme guidelines.
“Ahead of our next tenders opening later this year, we’re further engaging with industry and other stakeholders to explore how we can help deliver the energy transition in a way that benefits communities and consumers,” Codevelle said.
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