The Australian Renewable Energy Agency (ARENA) will allocate $999,000 for a feasibility study to investigate transmission capacity in NSW’s New England region.
TransGrid will undertake the $3.45 million study to develop, test and deliver a technical design and commercial process for the development of the New England Transmission Infrastructure (NETI).
ARENA’s funding will support the initial development phase for a new transmission line between Tamworth and Gunnedah.
The NETI would include a 330kV line and new substation east of Gunnedah, and would allow for connection of an additional 1,400MW of renewable energy peak generation capacity to the grid within the next three to five years.
ARENA’s funding will also help to facilitate the demonstration of an innovative unregulated transmission development model that can unlock additional private investment in transmission infrastructure to support new large-scale renewable energy investment, and further inform regulatory reform and market design.
TransGrid aims to deliver a new commercial model for transmission investment in the National Electricity Market (NEM) as an alternative to the current lengthy regulatory process.
ARENA CEO, Darren Miller, said, “This study will support and unlock more large-scale renewable energy projects in the New England region in northern New South Wales.”
In June 2020, ARENA also announced funding for TransGrid to undertake a scoping study to develop the Central-West Orana Renewable Energy Zone (REZ) with the New South Wales Government.
The New South Wales Government has also announced $79 million in support for grid infrastructure to unlock up to a further 8GW of large-scale generation in the wider New England region as part of its REZ strategy.
“Together, these TransGrid studies will provide two test cases for developing future renewable energy zones and the transmission infrastructure needed to support them,” Mr Miller said.
“Knowledge gained and shared during the study will also underpin other broad-based market reforms.
“It is hoped it will inform energy network businesses and regulatory bodies to develop the regulatory framework to promote more efficient investment outcomes.
“The NETI will host and underpin a significant amount of new renewable energy capacity for the NSW electricity market, while allowing TransGrid to test and validate new commercial models.”
Federal Minister for Energy and Emissions Reduction, Angus Taylor, said the study would look to leverage more private investment in energy infrastructure across New South Wales, which will help secure the region’s energy needs for the next decade and beyond.
“This study could see the network in northern NSW grow to provide for the future needs of regional businesses and families,” Mr Taylor said.
“This project has the potential to bring job opportunities to the region and see New England attract more private sector investment.
“This study will help to manage the integration of renewables into the grid. This is essential to help keep the lights on, keep energy bills low and importantly support local jobs in regional New South Wales.”
Member for New England, Barnaby Joyce, said the electorate had played a significant role in supporting locally-based renewable energy projects.
“The Federal Government has delivered millions of dollars of investment already for renewable energy generation right here on our doorstep in places like Inverell and Glen Innes,” Mr Joyce said.
“We still need baseload power supply from traditional energy sources, but this shows we’re also looking to the future and planning for the transition when the technology and energy demand allows.”
As part of the study, TransGrid is currently seeking expressions of interest (EOI) from renewable energy companies with large-scale generation projects in the New England region.
Participants will be asked to competitively bid an all-inclusive service fee for connection into the NETI.
In return for the service fee, participants will have guaranteed access to the NETI and related rights, in addition to development obligations.
Following the EOI to determine the market’s interest in taking capacity from the NETI, there will be a Request for Capacity process.
TransGrid Executive Manager of Business Growth, Richard Lowe, said, “TransGrid Services welcomes the ARENA funding, and we look forward to working with industry and renewable energy proponents in the region.
“We encourage companies looking to operate and connect to the grid in this area to respond to TransGrid Services’ EOI.
“The new transmission infrastructure in the state’s north-west will host 1,400MW capacity and is one of three NSW energy zones presenting potential large-scale generation options.
“The Federal and NSW Governments and the Australian Energy Market Operator support efforts to explore these zones to help enable the nation’s transition to a lower carbon economy.”
The New England Connection Capacity Auction process will be managed by Mitsubishi UFJ Financial Group on behalf of TransGrid Services.
Expressions of Interest in the NETI are due by 29 July 2020.
Interested parties should contact [email protected] for more information.