Genex achieves financial close for Jemalong and refinancing for Kidston

Sydney-based developer Genex Power Limited (Genex) has fought its way back from several unlucky blows to achieve financial close for the 50MW Jemalong Solar Project and the refinancing of the 50 MW Kidston Solar One Project.

December 19, 2019 Blake Matich

Genex's 50 MW Kidston Solar Farm 1 in Queensland.

Image: Genex Power

Several months ago the likelihood that Genex would manage the comeback it has seemed low. Today the Sydney-based developer has announced the financial close for the 50MW Jemalong Solar Project in New South Wales (NSW) and the refinancing of the existing debt facility for the 50 MW Kidston Solar One Project in Queensland, integral solar generator for the Kidston solar-pumped hydro project.

Last month Genex had its funding fall through after failing to lock in a previously announced offtake agreement with EnergyAustralia. This would mean Genex would not be able to secure finance on its landmark 250MW Kidston pumped hydro project and required a halt in trading on its securities.

This seeming calamity was compounded by the near loss of one of the projects’ major investors, Japan’s J-Power, whose investment hinged on federal funding put in doubt by the funding fallout.

Thankfully, the federal government’s Northern Australia Infrastructure Facility Board (NAIF) extended its funding to 30 June 2020, which also saw J-Power recommit to the project.

Now the comeback, like the projects themselves, is near complete. The total debt funding package weighs in at $192 million and has been independently verified as a Green Loan and is the first Green Loan globally to be certified under the latest internationally recognised Climate Bonds Standard. The combined Portfolio Financing is thus the largest certified Green Loan by an Australian renewable energy group.

“Genex welcomes the funding provided by the Clean Energy Finance Corporation, DZ Bank AG, Nord/LB and Westpac Banking Corporation,” said Genex CEO James Harding. “Genex is now in a strong position to grow earnings from its portfolio of renewable energy assets.”

Clean Energy Finance Corporation (CEFC) CEO Ian Learmonth spoke to the strengthening of the relationship between CEFC and Genex, a relationship that dates back to the CEFC’s original investment in the Kidston Renewable Energy Hub in 2017. Given the strong base provided by the Kidston Solar One Project, the CEFC is excited to support the Jemalong project in NSW. “The clean energy generated by the Jemalong Solar Project will provide more electricity capacity to the grid as it prepares for the upcoming retirement of coal-powered generation,” said Learmonth.

The Jemalong project is expected to see completion by the end of 2020 after Genex announced an Engineering, Procurement and Construction (EPC) contract and an Operation and Maintenance (O&M) contract with Victoria’s Beon Energy Solutions. “Genex is very pleased to enter into the EPC and O&M contracts with Beon, who have a strong history of renewable energy construction in Australia, complemented by their in-house expertise in grid connection, commissioning and electrical works,” said Harding.

Genex’s quick turnaround is a good sign for large-scale solar PV projects as Australia moves into 2020, a future without a federal renewable energy plan for large-scale projects. Evidently, increasingly secure and profitable investment in renewable energy projects means that industry can push on without government assistance. The federal policy vacuum may slow renewables down, but it can’t stop them.

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