Transmission company Transgrid says it has short-listed a number of projects that will be able to bid for capacity and access to a new transmission line in the New England region of NSW, although these represent just a fraction of the projects that had been proposed.
Transgrid says that it received submissions from 23 different proponents amounting to 6,900MW of renewable energy capacity seeking a spot on the new purpose built line that will run between Tamworth and Gunnedah,
However, the new line will only be able to accommodate 1,400MW of capacity, and these will be invited to take part in the next stage of the process – a Request For Capacity (RFC) stage to be released in November this year.
Transgrid says the list of proponents includes established local and overseas project developers, utilities, original equipment manufacturers and advisors. RenewEconomy understands that most of the shortlisted projects are solar, with some form of storage.
The new 330kV line is one of a number of new transmission projects – being dubbed renewable energy zones – that are being brought forward to ensure that the sort of grid congestion and system strength issues experienced in Victoria, north Queensland and south-west NSW are not repeated elsewhere.
The effort to co-ordinate the construction of wind and solar projects is an attempt to move on from what some describe as the “free-for-all that occurred elsewhere in the grid, and is a key part of the NSW government plan to ensure it has enough capacity installed to replace the ageing coal generators that will retire over the next decade.
It will also help transmission companies dodge the lengthy and unsatisfactory regulatory process that rules over most infrastructure assets. This will form part of the company’s “unregulated” business.
The company says the short-list provides a level of redundancy (in capacity, projects and proponents) to support a competitive process where proponents will be asked to bid an all-inclusive service fee for connection to the new transmission project. The chosen projects will be expected to fund the entire cost of the new line, but presumably will get access guarantees in return.
“We’re pleased there has been very strong interest from the market, totalling about 6,900 MW, from those wanting to secure capacity on the new, purpose built line,” said Transgrid’s head of business growth Richard Lowe
“It demonstrates a healthy appetite to invest in renewable energy generation where enabling infrastructure services can be delivered.”
Transgrid says the New England Transmission Infrastructure (NETI) project will create up to 2000 construction jobs and 150 ongoing operational roles, and is part of a $1 billion infrastructure development investment by TransGrid and renewable energy generators connecting to NETI.
The creation of renewable energy zones in all states is a key part of the Integrated System Plan put forward by the Australian Energy Market Operator, a 20-year blueprint outlining the investment needed to support a grid that will support up to 94 per cent renewables by 2040.