The Clean Energy Finance Corporation (CEFC) has announced the latest wave of successful transactions under its large-scale solar financing program, investing $77 million in three new projects in Queensland and Victoria.
The latest three large-scale solar projects are all expected to be operational by the start of 2018, adding a combined 165MW (AC) of renewable energy to the national electricity grid, enough to power about 87,000 homes. They include:
• The 57.5MW (AC) Whitsunday Solar Farm, north of Collinsville, which has a 20-year Power Purchase Agreement with the Queensland government. The project is expected to generate around 144,000MWh of energy a year, enough to power about 31,000 homes. This project has attracted $9.5 million in grant funding from the Australian Renewable Energy Agency.
• The 57.5MW (AC) Hamilton Solar Farm, also north of Collinsville in Queensland, which is expected to generate around 144,000MWh of energy a year, enough to power about 31,000 homes. Energy will be sold into the grid on a merchant basis.
• The 50MW (AC) Gannawarra Solar Farm, west of Kerang in Victoria, which has a 13-year PPA with EnergyAustralia. It is expected to generate about 116,000MWh of energy annually, enough to power about 25,000 homes. This is the CEFC’s first commitment to a Victorian solar farm.
The projects will lead to 300 jobs during construction. The projects are being developed by Australia’s Edify Energy, alongside leading international renewable energy investor Wirsol.
The investment takes the CEFC’s total commitment for large-scale solar to $281 million, above its $250 million target.
The CEFC, Commonwealth Bank and Germany’s NORD/LB have committed to a syndicated senior debt facility to support the three projects. Edify Energy and Wirsol are providing equity. The transaction is Australia’s largest single solar project financing deal to date.
CEFC large-scale solar program lead Gloria Chan said: “The Commonwealth Bank and NORD/LB worked alongside the CEFC to complete the financing over a longer tenor, which is notable given the merchant price risk component of the project.
“This trend of increasing competition and appetite for renewables among domestic lenders is central to the ongoing development of large scale solar in Australia.”
The investment package includes financing for Victoria’s first large-scale solar farm, representing the achievement of an important new milestone in the state’s renewable energy transition.
The CEFC recently announced a $150 million investment commitment to three large-scale solar projects in regional NSW, as well as a $54 million commitment to the innovative Kidston Solar Project near Townsville, which is looking to combine solar generation with pumped hydro storage.
These projects have also received ARENA funding.
Separately, the CEFC also committed to a $20 million equity investment in Australia’s largest solar farm, at Ross River in Queensland.
“We created our large-scale solar program as a means of providing tailored finance to accelerate large-scale solar projects in Australia at the lowest possible cost,” Ms Chan said.
“Through our recent investments, we have also seen a continued reduction in the cost of solar energy, to the point where it is increasingly competitive with other forms of electricity generation, confirming the central role of solar energy in Australia’s renewable energy mix.”