Origin Energy on course to prized transmission access as NSW whittles down bidders

Securing access to a key cog in the NSW renewables plan will come as relief to Origin following its $300m acquisition of the giant Yanco Delta wind development.

Australia’s largest electricity and gas retailer Origin is on course to secure access to a much-coveted transmission line after being preliminary-selected for a region earmarked as central to NSW’s energy transition plans.

The decision of NSW’s EnergyCo, which has yet to be made public as final details are still to be determined, would be a major fillip and relief for Origin, which paid $300m for the Yanco wind development.

Australia’s largest renewable energy developers late last year sent applications for access to the so-called South West Renewable Energy Zone, which emerged as the most coveted of the six regions identified as future homes to large-scale wind, solar and batteries.

The South West REZ is appealing to developers looking to overcome prohibitice planning laws as it is broadly supportive of new projects, enticing the likes of Neoen, Origin Energy, Acciona Energia, Squadron Energy and Iberdrola to seek transmission access to the zone.

The South West REZ stretches from Murrumbidgee in the east to Buronga in the west.

Sources, which declined to be named amid strict confidentiality clauses in the negotiations, told The Australian bidders have in recent weeks been notified of whether they have been successful.

A source familiar with the broad details said Origin had been allocated access and indicated AGL would also be victorious and progress to contract negotiations between NSW and successful bidders.

Representatives for both Origin and AGL declined to comment. Representatives for other bidders also declined to comment.

The South West REZ will be carried by the $3.3bn 500KV ­HumeLink, primarily built to carry the electricity produced by Snowy Hydro. With line constraints, the South West REZ will house about 2.5GW of new renewable energy projects, much smaller than other REZs.

A map of the Transgrid Humelink. Picture: Supplied

If Origin and AGL are successfully able to secure access for all of their proposed projects, there would be little left for others.

The Yanco Delta is projected to house 1.5GW, while AGL’s South West REZ plans involve a joint venture with Someva Renewables, which is expected to consist of a 1.2GW wind farm, 300MW solar farm, and 500MW battery.

If the South West REZ was bigger, the state would have been able to accommodate all of Australia’s largest renewable energy developers and given its transition plan a major boost.

NSW’s proposed Central West REZ, for example, has been earmarked for 14GW of new renewable energy generation and storage projects.

However, the South West REZ has limited capacity to be ­expanded amid vocal opposition to the HumeLink transmission line, although industry sources said they were confident it would eventually get built.

The allure of the region contrasts significantly with the so-called New England REZ, where nearly all developers insist new projects will be prohibitively difficult to secure social licence and therefore planning approval.

The New England REZ has been earmarked to house 8GW of renewables and batteries, but large swathes of the region — which has significant Nationals representation — have signalled their opposition to onshore wind and solar projects.

The federal Labor government has set an ambitious goal of having renewables generate more than 80 per cent of the country’s electricity by 2030.

NSW is particularly sluggish in its aim to reach its target. The state earlier this year was forced to strike a deal to keep open its largest coal power station, Origin Energy’s Eraring, for up to four years longer than scheduled.

Originally published as Origin Energy on course to prized transmission access as NSW whittles down bidders