Putting projects, partners and people at the heart of NSW’s energy transition

The energy transition is why I go to work each day and it is at the heart of what we are trying to achieve at EnergyCo. It’s a truly challenging undertaking, requiring a radical transformation of the way we think about, plan, design, regulate, fund, build, generate, transport and use electricity. 

Yet in the 10 years I’ve worked for the NSW Government in this space, I don’t think we’ve ever had so much policy, regulatory, financial, market or people power on our side. 

In late 2020, NSW legislated its transition plan – the Electricity Infrastructure Roadmap – with bipartisan support, including targets for 12 gigawatts of renewables and 2 gigawatts of long duration storage by 2030. Three years on, we are halfway and a quarter of the way towards achieving these targets respectively.

The Roadmap sets out statutory frameworks to enable the required investment in the three legs of the energy transition infrastructure stool: network, generation and storage. This includes pathways to deliver five Renewable Energy Zones, recover network costs from consumers, support generation and storage projects through Long-term Energy Service Agreements and access rights and levy fees from industry to fund Community and Employment Benefits. Statewide, hundreds of millions of dollars of funding will become available over the next 30 years.

We’ve set up a $2 billion Transmission Acceleration Facility to overcome barriers to investment and benefit sharing faced by other projects under the National Electricity Market (NEM) framework. And last year, we legislated our Net Zero targets including to halve emissions by 2030.

At EnergyCo, we are coordinating the delivery of Renewable Energy Zones and priority transmission as part of this NSW energy transition. Our vision is for a secure, affordable, fair and sustainable energy future for everyone in NSW.

Three pillars will underpin our current and future success: projects, partners, and people.

1. Projects - EnergyCo leading the charge

As set out in our Network Infrastructure Strategy, EnergyCo is coordinating delivery of five Renewable Energy Zones and two priority transmission projects across NSW. There is no transition without transmission and these projects will unlock an initial 14 gigawatts of new network capacity to do the heavy lifting in meeting our State’s renewable energy targets. 

Because our coal-fired power stations are closing in quick succession, we need these replacement projects to be delivered in quick succession too. EnergyCo is focused on concurrent, timely and cost-effective delivery of these projects. We’re undertaking development activities like community engagement, planning and technical studies ahead of regulatory approvals and running fit-for-purpose procurement processes to identify the best possible network operators. The Transmission Acceleration Facility allows us to do this in a way that the NEM hasn't seen before.

Our projects are at various stages of development, from design to construction. As the most advanced, the Waratah Super Battery is one of the largest committed battery energy storage systems (BESS) in the world, both in terms of power and energy storage capacity and is expected to start operations next year.

Importantly, we are future-proofing these projects because the transition doesn’t stop when we get to 2030. Our approach is to keep delivering now while planning for the future. To this end, at the end of last year, the NSW Government announced an increase to the ultimate size of the Central-West Orana REZ from 3 gigawatts to 6 gigawatts, noting it will be initially powered at 4.5 gigawatts but with the ability to be increased in the future. 

At EnergyCo we’re focused on seeing our projects through to the end, including through our Port-to-REZ initiative, which will facilitate the transportation of renewable energy infrastructure from the Port of Newcastle to the Renewable Energy Zones through road upgrades and coordinated permitting and traffic management and safety measures.

We’re also focused on helping generation and storage projects to get connected and stay connected through access schemes, which reduce congestion and curtailment for generation and storage projects, encouraging efficient investment in Renewable Energy Zones.

For the initial projects connecting to Central-West Orana REZ, EnergyCo is running an access rights application process, expected to open in early April. This process will help us to coordinate the delivery of not only the backbone transmission network, but also the hub-to-project assets and centralised system strength to get new renewable energy to consumers sooner. 

2. Partners - being better together

The transition not only requires network, generation and storage infrastructure to work together, it also requires the collaboration of Government, industry and communities.

We know that collaboration is key to our success and will work with our partners to continuously improve so we can be better together. We’re working closely with AEMO Services, our partner entity under the Roadmap, to meet the legislated renewable energy and storage targets. Following extensive consultation throughout 2023, we are working to finalise the South-West REZ Access Scheme with the aim of offering access rights alongside Long-term Energy Service Agreements as part of AEMO Services’ next Competitive Tender.

We’re partnering with new and existing network companies to design and build both our REZ network and priority transmission projects. In December last year we executed a commitment deed with ACEREZ as the preferred network operator to build, own and operate the network for 35 years. This is the first time the NSW Government has competitively procured a new transmission network, with delay and cost overrun risks to be substantially borne by the network operator, rather than passing them straight to electricity consumers.

We’ve collaborated with generation and storage projects since the get-go, with Registrations of Interest bringing forward over 150 gigawatts (GW) of potential projects totalling over $230 billion dollars in investor interest across our five REZs. 

We know that we need a pipeline of approved and bankable projects to make this happen. In 2023, our colleagues at the Department of Planning, Housing and Infrastructure (DPHI) finalised 18 renewable energy assessments as State Significant Developments. These projects have a combined capacity of 7.6 gigawatts. A further 29 projects are in the planning system with 20 more about to be submitted. EnergyCo is helping get projects assessed faster through a memorandum of understanding with DPHI to fund dedicated staff working on REZ project assessments.

And we’re partnering with the Commonwealth Government to reduce costs to energy consumers through concessional financing arrangements as part of the $20 billion Rewiring the Nation fund.

3. People - what it's all about

Last but most importantly, we are focused on people.

This is ultimately what the energy transition is all about – delivering secure, affordable and sustainable energy to people across our State, while leaving a lasting positive legacy for the people who host electricity infrastructure and a better world for future generations. I don't think we'll ever look back and say we focused too much on supporting people.

At EnergyCo, one of our core values is to be ‘grounded’. Our work is grounded in our experience engaging with communities, landowners, First Nations people and industry to understand local values and deliver essential infrastructure in a strategically planned and considered way. 

We endeavour to locate the infrastructure on as much industrial land as possible to reduce the amount of privately-owned land that needs to be used, as well as to minimise impacts on land that’s used for prime agricultural purposes and the environment. 

After releasing preliminary study corridors for the New England and Hunter Transmission Project transmission routes last year, EnergyCo continues to work closely with landowners and communities to finalise route alignment for these projects. 

We understand the property acquisition process can be difficult and take the wellbeing and mental health of landowners and affected parties seriously. Our engagement approach is to treat people with respect and empathy and we’re providing individual case managers as well as mental health support services to support landowners with this process. 

Access fees, paid by generation and storage projects, will help to fund our Community and Employment benefit program – starting with the $128 million program in the Central-West Orana REZ. This is in addition to Strategic Benefit Payments of $200,000 per kilometre per year for transmission lines hosted, recognising the important role landowners play in hosting this critical infrastructure.

Finally, EnergyCo is filled with passionate and purpose-driven people. We are solutions-focused, finding new and practical ways to get things done because the NSW energy transition is too important to fail. As we grow, our commitment is to maintain a supportive, diverse, inclusive and safe work environment for our staff and stakeholders. Because at the end of the day, it is these people, along with the broader energy sector, who will deliver this energy transition for everyone in NSW.