The Australian Renewable Energy Agency (ARENA) has congratulated Fotowatio Renewable Ventures (FRV) – the developers of the Moree Solar Farm (MSF) – on reaching a “landmark” agreement with Origin Energy for the sale of 100% of the electricity and large-scale generation certificates (LGCs) generated by MSF for the next 15 years.
Commenting on the agreement, ARENA CEO Ivor Frischknecht said the partnership brings to fruition the project’s commercial potential, made possible by FRV taking the project risk with support provided by ARENA and the Clean Energy Finance Corporation (CEFC).
He noted that FRV reached financial close on MSF in July 2014 by being willing to sell electricity and LGCs in the spot market, instead of obtaining a power purchase agreement first.
“In doing so FRV has pioneered an alternate PPA pathway for project developers in the development and construction phase of large-scale solar PV projects. This could encourage other renewable developers to consider taking on market risk, and therefore result in more large-scale renewables being developed,” Mr Frischknecht added.
The roles of ARENA and CEFC are uniquely distinct but complementary. The two agencies have been working together on a funding round for large-scale solar projects, with ARENA making $100 million available in grants and the CEFC $250 million in loans for eligible projects.
“ARENA’s large-scale solar funding round was made possible through the experience we gained in supporting MSF and other large-scale solar projects such as those located in Nyngan and Broken Hill,” Mr Frischknecht said.
“The commercial success of these first-of-a-kind projects for Australia provided ARENA with confidence that the $100M funding round could result in large-scale solar reaching commercial viability in Australia in the next five years.”
ARENA has shortlisted 22 large-scale solar project proposals – with a total project value of $1.68 billion – to proceed to the full application stage of the competitive round. The projects are seeking approximately $332 million in grant funding and have a total capacity of 766 megawatts (MW).