Neoen to build Australia’s largest solar farm after power deal with CleanCo

French renewables developer Neoen will go ahead with its plans to build a massive solar farm in Queensland’s Western Downs region after securing a contract to sell most of the power to the state government-owned renewable energy generator, CleanCo. With a capacity of around 400 MW, the Western Downs Green Power Hub is set to become Australia’s largest solar farm.

CleanCo has agreed to buy 352 MWp of the project’s output, which will help the state make progress on its target of 50% renewable energy by 2030. This is one of the first offtake deals for the corporation since its establishment in 2018, when the Palaszczuk Government moved to restructure its two publicly-owned electricity generation companies into three, creating a strategic portfolio of low and zero-emissions power generation assets designed to reduce power prices, known as CleanCo. 

The power purchase agreement will contribute over 30% of the energy required for CleanCo to meet its target of 1 GW of new renewable generation by 2025. The project, located 22 km south of Chinchilla in the state’s south-west, will generate energy to power 235,000 Queensland homes, or enough to power every home on the Sunshine Coast.

“The best thing we can do to support Queensland jobs is to support investment in our state,” Premier Annastacia Palaszczuk said. “Today we’re announcing support through CleanCo to unlock hundreds of jobs on the Darling Downs.”

The $570 million investment by Neoen is expected to create up to 400 jobs for the local and South West Queensland area when construction begins in July. Connection will be via publicly-owned Powerlink’s existing Western Downs substation via a new overhead line, with energy generation scheduled to start in the first quarter of 2022.

“As our economy emerges from the worst impacts of Covid-19, we need projects ready to go that will create jobs and stimulate spending, especially in regional Queensland,” Deputy Premier Jackie Trad said. “This is CleanCo’s third investment on behalf of its owners, the people of Queensland, and means Queenslanders now have 820 MW of new renewable energy in the pipeline.”

The deal with Neoen comes as calls emerge for a renewables-led economic recovery from coronavirus that could both encourage investment and speed up Australia’s renewable energy transition. A report published by the Clean Energy Council on Tuesday found that bringing forward the gigawatts of renewable energy projects in the development pipeline will: create over 50,000 new direct jobs, and many more indirect jobs during construction; triple the amount of large-scale renewable energy installed in Australia with the addition of more than 30 GW of new capacity and inject $50 billion of investment into the Australian economy — much of it in rural and regional areas.

Once construction begins, the Western Downs solar farm will become the first solar farm in Australia to be greater than 300 MWac. The facility is over 100 MWac larger than the second runner-up the 275 MWac Darlington Point owned by Octopus Investments and Edify Energy, which is then followed by innogy’s 249 MW Limondale Solar Farm, both developed in New South Wales. Assuming the facility finishes commissioning in 2021, Rystad Energy’s RenewableCube shows the dramatic increase in scale the utility PV industry has undergone since 2018.

For Neoen, which sees Australia as one of its key growth markets, the Western Downs Green Power Hub will be its first Queensland-based project. The French developer already has six solar farms, three wind farms, and the world’s biggest lithium-ion battery, South Australia’s Tesla big battery, under its belt.

“We are 100 percent committed to delivering this landmark deal by making the most of the region’s abundant solar resources, the use of cutting edge bifacial solar panel technology, and our experience in delivering ground-breaking solar farms on time and on budget,” Louis de Sambucy, Neoen Australia’s Managing Director.“We look forward to Western Downs becoming a lighthouse project in achieving excellent regional economic and local community outcomes that will be needed in the aftermath of Covid-19’s impact on the economy.” 

As per its strategy, Neoen will also be the long-term owner and operator of the project, sharing the ongoing benefits of this development with the local community. The developer will establish an annual $100,000 Community Benefit Fund that provides opportunities for local community-building initiatives for the duration of the project’s life.

With this move into Queensland, Neoen has confirmed its status as Australia’s leading independent producer of renewable energy. In 2018, the developer commissioned five utility-scale PV farms, all in New South Wales, with a combined capacity of just over 250 MW. In 2019, it commissioned a further 100 MW of PV – the Numurkah project that has a major supply contract secured with the Laverton Steelworks and is one of two solar farms supplying 100% renewable energy to offset Melbourne’s entire tram network. Neoen also tops the list of lithium-ion battery developers and ranks within the top 10 wind developers as well. 

Overall, as of end-September 2019, Neoen had 1.1 GW of renewable energy assets in operation or under construction around Australia, a mark that makes it Australia’s top independent power producer. It appears determined to keep this ranking.

“We would like to thank CleanCo Queensland for putting its trust in us. The signing of this first power purchase agreement for a Queensland project fully illustrates our willingness to extend our leadership in Australia, our first country in terms of capacity installed,” said Xavier Barbaro, Neoen’s Chairman and CEO.