The NSW government has committed $380 million over the next four years to boost network infrastructure for the state’s first renewable energy zones, which it hopes will unlock tens of billions of dollars in new investment in wind, solar and storage projects.
The funding will be used to underwrite the development of new transmission network infrastructure for the Central-West Orana Renewable Energy Zone, and the government wants new grid infrastructure to be ‘shovel ready’ early next year.
Funding has also been allocated to set up a number of oversight bodies, including a new Consumer Trustee to act as a consumer advocate, as well as a Financial Trustee and a new regulator to oversee investment decisions being made in the new Renewable Energy Zones.
The NSW government is pursuing a vision to support massive amounts of new investment in clean energy infrastructure, including 12GW of new low emissions generation capacity and 2GW of energy storage to be built before the end of the decade.
This is expected to both slash the state’s greenhouse gas emissions footprint while also locking in lower energy prices for NSW consumers, and largely replace the state’s fleet of ageing coal generators.
Energy minister Matt Kean said that the NSW government had committed to the ‘most ambitious’ renewable energy policy of all Australian jurisdictions.
“With four of our five coal fired power stations due to reach the end of their technical lives in the next fifteen years, we are on the clock to replace them before they close to keep the lights on and prices down,” Kean said.
“The Roadmap is expected to deliver NSW families and businesses some of the cheapest electricity in the OECD and will set the State up for success in a low carbon world.”
The money has been set aside by the Berejiklian government ahead of the next state government budget, which is due to be handed delivered next Tuesday.
NSW Treasurer Dominic Perrottet said the funding would be used to implement the government’s Electricity Infrastructure Roadmap that it expects to unlock a substantially larger amount of private investment.
“The Roadmap is expected to attract $32 billion of investment over the next decade and create thousands of jobs,” Perrottet said.
The Electricity Infrastructure Roadmap is also expected to support the creation of 6,300 new construction jobs and as many as 2,800 ongoing jobs, mostly located in regional New South Wales, by 2030.
The NSW government expects the Central-West Orana Renewable Energy Zone could attract as much as $5.2 billion in private investment in new wind, solar and dispatchable energy projects – providing as much as 3,000MW of new generation capacity.
The additional funding has been welcomed by the Clean Energy Council, which said it would help underpin investor confidence and ensure the state was on track to meet its ambitious investment targets.
NSW has legislated ambitious plans to completely transform its electricity sector in the coming nine years, with a comprehensive plan to strengthen and expand its transmission backbone and attract clean energy generation and storage capacity,” CEC chief executive Kane Thornton said. “Delivering strategic transmission upgrades will be critical to attracting private investment within the renewable energy zones.”
“We’re pleased to see this scale of ambition will be matched with significant funds in this year’s budget to establish the necessary governance bodies, undertake the strategic planning, lay the foundations for the future transition build and begin to contract with the private sector.”
The government received an extraordinary response to a call for interest from prospective project developers, with more than 27,000MW worth of proposed projects registering their interest. It has recently put out a similar call for New England, despite the protestations of local federal member Barnaby Joyce.
The Liddell (1,680MW), Bayswater (2,640MW), Vales Point (1,320MW) and Eraring (2880MW) power stations – all fuelled by black coal – are all expected to close between now and 2035.
The NSW government recently launched a $50 million recoverable grants program to support the development of new pumped hydro energy storage projects in the state.
Through the program, the government is hoping to support the development of 3,000MW of new longer-term storage capacity that can provide at least eight hours of backup supply.
The new funding for the state’s first Renewable Energy Zone follows earlier commitments from the NSW government of $40 million for the Central West-Orana REZ and $79 million to support the development of an additional zone in the state’s New England region.
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