MPower said the funding agreement with Singapore-headquartered Ampyr Energy will provide the company with a flexible funding solution to expand its asset portfolio on a project-by-project basis, in alignment with its development strategy to build a national network of circa 5 MW solar farms and battery energy storage systems.
“The agreement with Ampyr Energy provides MPower with the financial framework required to commence portfolio construction,” MPower Chief Executive Officer Nathan Wise said.
“The innovative funding model has been designed to provide the company with funding flexibility in the design and construction phase, while allowing both parties to participate in the upside from the long-term supply of renewable energy to major power grids across Australia.”
Sydney-based MPower said an agreement has already been executed for the first $10 million (USD 6.68 million) in funding which will support the construction of a 5 MW solar project being developed at Narromine near Dubbo in western New South Wales (NSW).
Wise said work on the Narromine Renewable Energy Project is scheduled to commence in the coming weeks and it will take about nine months to get the project to revenue generation.
MPower said the project has already secured all necessary permits and will connect into the Essential Energy network, generating approximately 14,000 MWh of electricity in its first year.
The Narromine project forms part of MPower’s plan to establish a build, own and operate portfolio of up to 20 small utility-scale solar farms and battery energy storage systems throughout Australia’s eastern states.
The company has made it clear that its focus is squarely on the mid-scale sector, with projects of 5 MW or less being particularly attractive as they can avoid more protracted grid connection processes.
“We couldn’t get comfortable with some of the risks around large-scale renewable energy projects, in particular the grid and connection risks that are really part and parcel of those larger projects,” Wise said.
“We identified the advantages of these small utility-scale projects, in particular the relatively short time it takes to both develop and construct them, but also the ease of connection and the ability to export power as and when you generate rather than being under the direct control of the market operator.”
“There is a lot of risk that is circumvented by taking a portfolio approach with these smaller projects rather than investing everything in one larger asset and we’re particularly attracted to the weather diversification, the network diversification and the other elements of the portfolio that you get when you put multiple projects together in a portfolio.”
For Ampyr, the funding agreement marks an expansion of its involvement in the Australian clean energy market.
Ampyr Australia Director Ben Salmon said the company, which late last year announced it would team with oil major Shell to develop a 500 MW/1,000 MWh big battery at Wellington near Dubbo, has identified Australia as a growth opportunity.
“We are excited to be expanding our renewable energy activities in Australia where we see enormous opportunities emerging from the transition to clean energy,” he said.
Construction of the Wellington battery energy storage system is expected to commence later this year. Once operational, Shell Energy will hold the rights to charge and dispatch energy from the asset.
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