Published on 19 July 2022
I begin by acknowledging the traditional owners of the land and pay my respects to their Elders, past, present and emerging.
Thank you to the Clean Energy Council for the invitation to speak with you today. Energy Minister Matt Kean passes on his apologies for not being here with you.
You understand that the case for acting on climate change and accelerating NSW’s potential to be a renewable energy superpower is more compelling than ever.
It requires us to take on the greatest engineering feat of our time.
But by marshalling the power of human ingenuity, science, technology and private capital, we can give NSW a contemporary energy network that delivers clean, reliable and affordable power.
Over the past two years, NSW has worked relentlessly to realise the objectives of our Electricity Infrastructure Roadmap.
In December 2020 we gave legislative effect to the transformation by passing the Electricity Infrastructure Investment Act with bipartisan support.
Our Renewable Energy Zones are modern day power stations which combine renewable energy generation, storage such as batteries and the network infrastructure to reach homes, business and industries.
In May this year, we shortlisted three consortia to design, finance, build, operate and maintain the Central-West Orana Renewable Energy Zone network infrastructure.
The Central-West Orana REZ will initially unlock three gigawatts of new generation capacity from solar and wind within the next decade – bringing up to $10 billion in private investment to the region.
Registrations of Interest for projects in the Central-West Orana, New England, South West and Hunter Central Coast Zones have been conducted.
On each occasion, responses exceeded the capacity required to build out the zones.
For the fifth zone in the Illawarra, the registration of interest is open until the end of this week and we expect the REZ to be formally declared by the end of 2022.
And there are now more than 180 large-scale renewable energy projects totaling around 35,000 megawatts either approved or currently progressing through the State’s planning system.
We’re also responding to the urgent need to invest in critical transmission infrastructure.
We announced in the State Budget delivered last month that the Government is investing $1.2 billion into a new Transmission Acceleration Facility.
The Facility will help fast track the Zones and other critical transmission we need to bring capacity online in time as our existing power stations retire.
We expect to catalyse an estimated $14 billion of private investment in transmission infrastructure alone.
It will fund development activities for new transmission projects to deliver our Roadmap.
Development funding will be recovered from investors and recycled into new projects. All government contributions are expected to be recovered.
In addition, we announced earlier this year that we will invest in a 700 megawatt Waratah Super Battery which will be the largest network standby battery in the Southern Hemisphere.
The battery will effectively act as a shock absorber, unlocking transmission capacity that otherwise has to be left in reserve to handle events like power surges from lightning strikes or bushfire.
EnergyCo recently launched a competitive procurement process to identify suitable battery developers and appropriate sites for the development of the Battery.
The expression of interest attracted global interest.
The final decision is expected to be made toward the end of 2022 to determine the best project development proposal and site requirements.
We will continue to accelerate our work to ensure the battery is in operation well in advance of the earliest potential closure date for Eraring Power Station.
These achievements are only the beginning.
We are now taking a quantum leap forward in fulfilling our vision – the launch of the first tender under the Electricity Infrastructure Investment Safeguard.
The Safeguard provides a framework for technologies to compete and provide the long duration storage, firming and generation solutions we need.
The Safeguard also offers price guarantees that will provide long-term certainty for investors, reduce the risk profile on projects and lower the cost of capital.
It stipulates that the Consumer Trustee will run competitive tenders to offer Long-Term Energy Service Agreements for generation, long duration storage and firming infrastructure.
The Consumer Trustee yesterday published the draft tender pack to provide projects with the information they need for the first tender we expect to launch in October.
The tender will seek bids on Long Term Energy Service Agreements for projects across NSW, and access rights in Central West Orana Renewable Energy Zone.
The Agreements will be option contracts that give the project optional access to a competitively set minimum price for their energy service.
It is the culmination of 18 months of consultation and collaboration with industry to get the design right.
The indicative size of the first tender was increased earlier this year to 2,500 gigawatt hours of annual generation and 600 megawatts of long duration storage.
This reflected the Consumer Trustee’s response to the announcement that Eraring would close earlier than anticipated.
The Consumer Trustee will continue to ensure that the competitive tenders are conducted in the long-term financial interests of consumers.
That means they may well award more or less than the indicative size based on their assessment of the competitiveness of submissions.
But the rolling schedule of bi-annual tenders to be conducted over ten years will secure our State’s energy future whilst putting downward pressure on prices.
It will ensure we remain on track to replace the generation capacity produced by four out of five of NSW’s existing fleet of coal-fired generation plants.
The exciting progress we have made under the Roadmap shows our plans are working.
We are on track to meet our emission reduction targets - including net zero by 2050.
We are on track to deliver the trifecta of clean, reliable and affordable power.
And we are on track to make NSW a renewable energy superpower to propel our prosperity for decades to come.
I thank everyone who is already part of our clean energy transformation in NSW and I look forward to working to continuing to work with you.
Featured article photo: