CEFC finance supports cleaner grid with forecasting technology at battery ready Oakey Solar Farm
30 December 2017
The Clean Energy Finance Corporation (CEFC) is extending its commitment to the 80MW (AC) Oakey Solar Farm in south-east Queensland, in an investment that will also deliver forecasting technology to enhance grid stability and energy reliability.
CEFC Large-Scale Solar lead Gloria Chan today confirmed the CEFC would commit $55 million in debt finance to Oakey 2, the 55MW second stage of the Oakey Solar Farm. The investment builds on the CEFC's earlier a commitment of $19.5 million for the adjacent 25 MW Oakey 1 development, which is already under construction.
When completed, the combined 80MW Oakey project is expected to deliver enough renewable energy to power around 24,000 Queensland homes.
"This is an exciting development for the next generation of Queensland solar, with the Oakey project being 'battery ready'," Ms Chan said.
"A key feature of the CEFC's role in the market is to encourage critical technologies that assist in Australia's smooth transition to a cleaner, more reliable electricity grid.
"As part of this investment, equity sponsor Foresight Solar Fund Limited will collaborate with the Australian Energy Market Operator (AEMO) to install suitable five-minute forecasting technology that can assist AEMO enhance grid stability as Australia transitions to higher penetration of renewables."
The CEFC recently committed $150 million in debt finance to stage one of the Lincoln Gap wind farm, in South Australia's Port Augusta region. The CEFC financing facility includes finance towards a 10MW battery energy storage system, capable of producing up to 10MWh of fast response storage capacity.
Ms Chan said: "We are pleased to invest in innovative clean energy projects such as Oakey and Lincoln Gap, which are at the forefront of a new model of renewable energy development. Both projects will demonstrate how we can accommodate an increasing proportion of renewable energy into the electricity grid, helping Australia lower electricity-related emissions while delivering a clean and reliable grid. We expect this trend to continue in future projects that we finance."
The CEFC has committed approximately $495 million in finance towards large-scale solar projects in Queensland, accelerating the development of more than 750MW in large-scale solar capacity in the Sunshine State.
"Our solar investments in Queensland have supported a number of innovative projects, including the first stage solar farm at the Kidston Renewable Energy Hub, which will eventually use pumped hydro as a form of energy storage. We are also financing the Kennedy Energy Park in Queensland, which integrates wind, solar and battery technologies," Ms Chan said.
"Solar is an increasingly cost-effective energy solution in areas like Oakey, which have high levels of solar irradiation. It makes sense to increase solar energy generation in these areas alongside investing in complementary technologies that enhance the stability of a renewables-powered grid."
Oakey 2 is being developed by Canadian Solar on an uncontracted or merchant basis. Oakey 1 secured an offtake agreement from the Queensland Government as well as funding support from the Australian Renewable Energy Agency.
The development, which is on agricultural land, provides local land owners with the opportunity to improve the resilience of their farming operations by generating an additional source of income through long-term leasing.
The Foresight Solar Fund Limited announced the acquisition of a 49 per cent share in Oakey 1 and 100 per cent interest in Oakey 2 in October. The Foresight fund's Australian solar portfolio includes the Longreach solar farm in Queensland and the Bannerton Solar Park in Victoria. In addition, Foresight Group, on behalf of KDB Infrastructure Investments Asset Management Co. Ltd and Hanwha Energy, acquired the Barcaldine Remote Community Solar Farm in Queensland, which also benefited from CEFC finance.
Ricardo Pineiro, Partner of Foresight commented: "We are delighted to be working alongside the CEFC once again on the financing of the Oakey projects. This project is particularly interesting for the Fund because it will be the first to include forecasting technology which will help enhance grid stability. This is very important as more renewables generation gets connected to the grid."
Canadian Solar's General Manager Daniel Ruoss said: "Since 2014, Canadian Solar has been investing millions of dollars in Queensland and its world-class solar resources. Through our project developments, we are collaborating closely with local stakeholders to maximise the benefits for the region and local communities.
"Oakey 2, which will involve 120 construction jobs, is scheduled to commence construction in the first quarter of 2018 and we expect it to be grid connected by the end of 2018."
ABOUT FORESIGHT SOLAR FUND LIMITED
FSFL is the largest of the solar focused renewables infrastructure companies listed on the London Stock Exchange in terms of operational assets. Having raised £150 million at IPO in October 2013, FSFL has since raised a further £313.2 million from institutional investors and private investors, and continues to deliver its target dividend return which, for calendar year 2017, is 6.32p per share (inflation adjusted from 6.17p in 2016). The Company invests in ground-based predominantly UK solar power assets with the objective of delivering a sustainable and increasing index-linked dividend to shareholders with the potential for capital growth over the long-term. Of the Company's 621MW portfolio 475MW is UK based, operational and fully accredited, with the remaining capacity under construction in Australia.
ABOUT CANADIAN SOLAR
Founded in 2001 in Canada, Canadian Solar is one of the world's largest and foremost solar power companies. As a leading manufacturer of solar photovoltaic modules and a provider of solar energy solutions, Canadian Solar has a geographically diversified pipeline of utility-scale power projects in various stages of development. In the past 16 years, Canadian Solar has successfully delivered over 22 GW of premium quality modules to over 100 countries around the world. Furthermore, Canadian Solar is one of the most bankable companies in the solar industry, having been publicly listed on NASDAQ since 2006. For additional information about the Company, follow Canadian Solar on LinkedIn or visit http://www.canadiansolar.com
Media release, 2017