Clean Energy Finance Corporation backs Central-West Orana Renewable Energy Zone

NSW electricity consumers will save as much as $240m over the next two decades, with the Clean Energy Finance Corporation backing a renewable energy zone in the state’s central-west.

The central west of NSW has some of the world’s best solar and wind resources. Picture: Ray Strange

NSW electricity consumers will save as much as $240m over the next two decades following the Clean Energy Finance Corporation backing the Central-West Orana Renewable Energy Zone with a major loan package.

In the largest transaction the CEFC has entered, the organisation will lend the project $490m from the Rewiring The Nation Fund, with the money to be spent to secure the land to build out electricity infrastructure in the zone.

The CEFC debt will be extended to NSW EnergyCo at a government cost of funds, which was significantly cheaper than would otherwise be available on the commercial market, CEFC chief executive Ian Learmonth said.

Those savings would over time flow back to consumers in the form of lower energy bills.

EnergyCo is the statutory body charged with planning the infrastructure for the renewable energy zone, with ACEREZ, a consortium formed by Acciona, Cobra and Endeavour Energy, selected as the preferred network operator to design, finance, build and operate the project.

The NSW government is planning five renewable energy zones across the state, with each to be built out with supporting infrastructure to facilitate the development of large renewable energy projects and storage projects.

The CWO-REZ is expected to unlock 4.5GW of new network capacity by the middle of this decade, bringing up to $10bn in private investment to the region, centred around Dubbo and Mudgee, as well as about 5000 construction jobs at its peak.

“The Central-West Orana REZ is a truly transformative project for Australia’s low emissions future and for the NSW economy,’’ Mr Learmonth said.

“It will deliver a bigger, stronger, cleaner and more reliable energy grid fit for the 21st century.

“With an additional 4.5GW in network capacity, it will also unlock new low-cost solar and wind generation, backed up by battery storage.

“As the second commitment through the RTN Fund, it also signals the strength of our focus on delivering much needed capital in a timely manner to this large and complex investment task.”

Mr Learmonth said the region had some of the world’s best solar and wind resources, and would play a crucial role as a large proportion of the state’s coal generation exited the network by 2030.

The Central West region was selected as an area suitable to host a renewable energy zone after a statewide study carried out in 2018, and it was the first such zone declared in Australia.

Originally published as Clean Energy Finance Corporation backs Central-West Orana Renewable Energy Zone