EnergyAustralia has announced it would sign agreements to buy around 500 megawatts (MW) of power from new wind and solar energy projects across eastern Australia.
Managing director Catherine Tanna said the foundation contracts, worth an aggregate $1.5 billion, would underpin significant investment in new renewable energy developments.
In the first commitment announced under the program, EnergyAustralia has agreed binding terms to buy all the electricity produced by a 42.6MW solar farm at Manildra in regional New South Wales.
A final, 13-year power purchase agreement is expected before the end of the year.
“EnergyAustralia owns two of the largest coal-fired power stations in the country, providing customers with reliable, affordable electricity,” Ms Tanna said.
“But our operations also generate more than 20 million tonnes of carbon dioxide a year at a time when the community rightly expects us to play our part in lowering carbon emissions.
“Owning big power plants comes with the responsibility of promoting and leading the development of cleaner forms of energy. That’s why we’re committing to buy 500MW of power from new solar and wind projects around the country, providing the support they need to get built.
“These are the projects which will come to underpin energy supply in Australia as coal-fired power plants are retired, so customers continue to enjoy reliable, affordable energy.”
EnergyAustralia’s program will contribute toward the Australian Government’s Renewable Energy Target to have 23 per cent of total energy in the national electricity market provided by renewable sources by 2020.
The Manildra Solar Farm is supported by funding from the Australian Renewable Energy Agency (ARENA) and is being developed by First Solar, one of the world’s largest developers of utility-scale solar projects. Construction is scheduled to commence in early 2017 for completion in 2018.
“Today’s announcement is representative of the widespread support for utility-scale solar as a competitive and bankable energy source in Australia, and we congratulate EnergyAustralia on their leadership and commitment to renewable energy,” said Jack Curtis, First Solar’s regional manager for Asia Pacific.
“ARENA’s ongoing support for high-quality project deployment has been instrumental in driving the commercial competitiveness of utility-scale solar in this country, and we’re pleased to deliver the Manildra Solar Farm.”
EnergyAustralia’s agreement covers the farm’s entire electricity output, enough emissions-free, renewable energy to power up to 14,000 homes each year, until 2030.
Ms Tanna said negotiations between EnergyAustralia and proponents of other solar and wind projects across eastern Australia were well-advanced.
To date, EnergyAustralia has underpinned more than $1 billion of capital investment in new renewable generation.
Its existing renewable energy investments include the rights to more than 450MW of electricity from wind farms in New South Wales, Victoria and South Australia, representing enough power to meet the electricity needs of 300,000 average homes for a year.