NSW’s Central-West Orana renewable energy zone wins green light for 4.5GW project

Approval for transmission lines at NSW’s Central-West Orana renewable energy zone is expected to drive up to $20bn in private investment for solar, wind, and energy storage projects.

The federal government has granted planning approval for NSW’s Central-West Orana renewable energy zone, a key plank of the state’s ambition to add12 gigawatts of green power to the electricity grid.

The move follows NSW in June approving a 240km stretch of transmission line and enabling infrastructure as part of broader plans to concentrate large-scale renewable energy generation ­capacity so as to minimise the upheaval on regional communities.

The Central-West Orana zone will deliver at least 4.5GW of electricity, with the Energy Corporation of NSW moving ahead with a tender to award a preferred network operator for the deal to design, build, operate and maintain the transmission line network.

EnergyCo says the zone covers approximately 20,000sq km and takes in cities and towns including Dubbo, Dunedoo and Mudgee.

Aerial view of the Stubbo solar farm project under construction just north of Gulgong, part of the Central-West Orana renewable energy zone. Picture: Max Mason-Hubers

The project is expected to drive up to $20bn in private investment in solar, wind, and energy storage projects, supporting about 5000 jobs during peak construction.

“Securing planning approval for the Central-West Orana REZ transmission project is a huge step forward in progressing 12GW of generation under the NSW Electricity Infrastructure Roadmap and moving towards NSW’s clean energy future,” EnergyCo chief executive James Hay said.

“This is the first REZ in the country to obtain full planning approval, paving the way for a significant boost in renewable energy generation to replace ageing coal-fired power stations.”

Construction on the transmission line is expected to begin later this year to allow the REZ to start operations in 2028.

The approval of the transmission line comes as Australia struggles to secure community support for the necessary infrastructure.

The nation needs to build about 10,000km of transmission lines by 2050 to connect the renewable energy projects required to adequately replace coal and meet expected growth in electricity demand.

Some communities are opposed to new power infrastructure. Picture: Max Mason-Hubers

Some regional communities have vowed to oppose the infrastructure, however, insisting the transmission lines will damage their property values and disrupt farming operations, and they say the compensation they have been offered is inadequate.

In bid to strengthen support, the NSW government last year announced it would spend $128m over the next four years in the Central-West Orana REZ to deliver community projects and employment opportunities.

The Central-West Orana REZ will be the first of the planned five, in which NSW intends to establish 12GW of renewable energy projects and 2GW of storage, most likely large-scale batteries.

Each will need transmission lines to connect them to the main grid, but the Australian Energy Markets Operator has said bolstering the amount of renewable energy will help lower wholesale electricity prices.

A vineyard on the approach to Mudgee. The Centra-West Orana REZ covers approximately 20,000sq km and takes in cities and towns including Dubbo, Dunedoo and Mudgee. Picture: Max Mason-Hubers

NSW is under mounting pressure to deliver its transition road map as its largest coal power station, Origin Energy’s Eraring, will close by 2029, potentially even two years earlier.

The NSW government was forced to strike a deal with Origin to ensure it stayed open until at least 2027 after an independent expert concluded allowing it to shut as planned next year would heighten prices and increase the risk of blackouts.

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 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.

NSW electricity consumers will save as much as $240m over the next two decades following the Clean Energy Finance Corporation backing the zone with a major loan package in May.