The biggest solar and battery hybrid projects in Australia have reached financial close, locking in a landmark deal that will help power giant aluminium smelters and refineries and help change the debate around the future of the grid.
Edify Energy, now owned by Canadian giant La Caisse, says 14 Australian and international lenders have come together to back the Smoky Creek and Guthrie’s Gap projects in central Queensland, which will combine 600 megawatts (MW) of solar and 600 MW and 2,400 MWh of battery storage.
The two neighbouring projects are a key part of mining giant Rio Tinto’s plans to close the ageing Gladstone coal fired power station in 2029 and turn to green energy and storage, from Smoky and Guthrie’s Gap, as well as the Upper Calliope solar farm, the Bungaban wind project, and other projects yet to be announced.
“Smoky Creek and Guthrie’s Gap are critical projects in the energy transition, generating cost-effective, reliable and dispatchable renewable energy,” Edify Energy CEO Ben Warne said in a statement.
“These are the first projects to reach financial close under La Caisse ownership and reflect the scale of Edify’s and La Caisse’s ambition in making a meaningful contribution to the energy transition.”
The two projects have locked in a 20-year off take deal with Rio Tinto – for 90 per cent of their output to help power the Boyne Island smelter in Gladstone and two refineries – and they are also supported by underwriting agreements with the federal government’s Capacity Investment Scheme.
The deal is an important one for the federal government’s ambitions to reach its target of 82 per cent renewables by 2030, which has been made more difficult by the actions of the LNP state government in Queensland, which has scrapped the state’s own renewable targets and erected barriers to new projects.
Indeed, the LNP’s energy roadmap makes clear that the only wind and solar projects that it wants to see go ahead in its state are those that support the transition of the Gladstone smelters and refineries, which are the biggest energy users in the state.
It has “called in” a number of other wind and battery projects, and some of them remain in limbo after more than a year of uncertainty.
Ironically, the Smoky Creek and Guthrie Gap projects represent one of the nation’s largest renewable energy off-take deals for the industrial sector, and one of the most advanced examples of firmed solar energy powering heavy industry.
“The Smoky Creek and Guthrie’s Gap Solar power stations will deliver utility‑scale solar generation integrated with battery energy storage and advanced grid-forming inverters, purpose‑designed to provide low cost, reliable dispatchable renewable power,” Edify Energy said.
“Together, the projects will strengthen Queensland’s energy system, support industrial demand and contribute to improved reliability as aging thermal generation retires.”
Edify has already begun early works on the sites and Malaysia-based DT Infrastructure has won the main contract to build the projects. DTI is also building the Carmody’s Hill wind farm in South Australia and the Jinbi solar farm in Western Australia.
Edify says the project has strong backing from landholders, the local community in the Banana Shire, and the Gaangalu Nation people. The project will create up to 800 jobs at peak construction and support local apprenticeships and skills training.
“The projects will maximise local procurement, supporting local suppliers and the Australian domestic steel industry. Supported by a community benefits program spanning more than 35 years, the projects are designed to leave a lasting, positive legacy for the region,” the company said.
It also describes the “greenfield renewable energy portfolio financing package” as a first for Australia and will provide a scalable foundation for future projects.
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Giles Parkinson
Giles Parkinson is founder and editor-in-chief of Renew Economy, and founder and editor of its EV-focused sister site The Driven. He is the co-host of the weekly Energy Insiders Podcast. Giles has been a journalist for more than 40 years and is a former deputy editor of the Australian Financial Review. You can find him on LinkedIn and on Twitter.
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