Sydney-based publicly listed Genex Power has announced that it has landed a concessional debt funding of $516 million from the Northern Australia Infrastructure Facility (NAIF) for the second stage of its Kidston power facility, comprising a 270 MW solar PV plant and a 250 MW of pumped storage hydro project.
The potential loan is for a term of 20 years at concessional interest rates, and will account for the bulk of the project debt funding.
“This is a significant milestone in the development of the Project,“ said James Harding, CEO of Genex. “We are looking forward to working with NAIF over the coming months as we move towards achieving financial close in the latter half of the year.“
The subordinated loan is subject to a number of conditions and customary terms, such as negotiating offtake agreements, grid connection and dispatch right to the satisfaction of NAIF, concluding a cost benefit analysis which will be important in determining the level of concessionality that NAIF can offer the Project, and finalizing terms for senior debt funding.
“NAIF sees the project as important for the transition of the market to lower emission renewable energy sources, and the board’s preparedness to consider a capital commitment of the size referred to in this announcement reflects the alignment of this type of project with NAIF’s objective to contribute to the transformation of Northern Australia through infrastructure development,” said Laurie Walker, the CEO of NAIF.
In his welcome of the Genex Kidston announcement, Minister of Resources and Northern Australia Matt Canavan made sure to clarify this is not yet a done deal.
“Genex Kidston project is one of several progressing through the various stages required before approval,“ Canavan said, noting that the NAIF has not yet made an investment decision nor has it given an commitment for financial assistance
The Kidston Stage 2 project, which received a development approval in April, comes on top of the 50 MW Stage 1 solar farm switched on late last year. Stage 3 of the hub will consist of an up to 150 MW wind farm.
To date, the Kidston energy hub, located on the site of a 100-year-old mine in Queensland, has received $8.9 million in funding from the Federal Government, through the Australian Renewable Energy Arena (ARENA) for the construction of the Stage 1 solar project, and up to $9 million in funding to support the development of K2-Solar and K2-Hydro.