31 October 2023
AEMO Services has opened registrations for the fourth tender of the NSW Electricity Infrastructure Roadmap, seeking generation projects located anywhere in NSW that can demonstrate benefits to host communities and financial value to NSW electricity consumers.
In its role as Consumer Trustee under the Roadmap, AEMO Services has already supported an estimated $2.5 billion in investment through its highly -competitive first tender for generation infrastructure, from projects set to produce enough energy to power 700,000 homes in NSW.
AEMO Services Executive General Manager Paul Verschuer said that projects hoping to be successful in Tender 4 would have to pass a similarly rigorous process.
“We use a two-stage tender process that establishes, in the first instance, a project’s social licence commitments, deliverability and proponent quality, followed by a financial value assessment.
“We have a strict mandate to only recommend those projects which can demonstrate value to their host communities and financial value to electricity consumers, and successful bids will need to reflect both of these priorities.”
Successful participants will be awarded Long-Term Energy Service Agreements (LTESAs), which provide the necessary insurance against future price risk to help fast-track project development.
The tenders are an important facet of AEMO Services’ broader blueprint for the energy transition in NSW, as set out in the Infrastructure Investment Objectives Report. This plan, updated every two years, sets out a 20-year development pathway and 10-year tender schedule to transition to a clean and reliable energy system at minimal cost to consumers.
“The tender schedule is designed to adapt over the next decade to capture value from new technology and adjust to new market dynamics and emerging needs within the system, ensuring an optimal outcome for electricity consumers through all conditions. “The regular cadence of the tenders also allows projects multiple opportunities to participate, and we’ve designed the process to minimise the cost and time required to re-submit updated and improved bids.
“We’ve already seen this in action, with unsuccessful participants from our first tender coming back and updating their bids in future rounds.
“We expect that tenders held in the second, third and fourth years will be the most competitive, as access is opened to additional REZs across the State, and as the market continues to deliver new solutions to the energy transition,” Mr Verschuer concluded.
Access Rights for the Central-West Orana REZ will not be released in this tender round to allow more time to consider the detailed feedback received from generation projects in the REZ.
EnergyCo will continue to work with AEMO Services to make Central-West Orana REZ Access Rights available as soon as possible.
Last updated 31 Oct 2023