NSW doubles size of Central-West Orana REZ to 6 GW

The Central-West Orana Renewable Energy Zone (REZ) was originally intended to deliver 3 GW of new renewable energy into the grid but the New South Wales (NSW) government has announced the declaration has now been amended to increase the intended network capacity of the REZ to 6 GW by 2038.

The state-owned Energy Corporation of NSW (EnergyCo), which has been appointed as the infrastructure planner for the Central-West Orana REZ and will coordinate the transmission, generation, firming and storage projects, said the initial network capacity of the transmission infrastructure is expected to be 4.5 GW.

“This will support the REZ to generate additional renewable energy in the future, which analysis indicates may be required in the late 2030s,” EnergyCo said.

The change will not alter the geographical size of the REZ, which encompasses an area of about 20,000 square kilometres centred around the inland town of Dubbo and extends west to Narromine and east beyond Mudgee and takes in Wellington to the south and Gilgrandra to the north.

The boost in capacity comes on the same day that the government entered a commitment deed with a consortium comprised of Spanish renewables major Acciona, NSW-based network operator Endeavour Energy and United Kingdom-headquartered solar installer Cobra Energy, as preferred network operator for the REZ.

Subject to regulatory and planning approvals, ACEREZ will design, build, finance, operate and maintain the Central-West Orana REZ transmission network for the next 35 years. This includes new high-capacity transmission lines, energy hubs and related infrastructure.

“The new transmission infrastructure will enable generators such as solar and wind farms and energy storage providers in the REZ to connect to the electricity grid at a scale never seen before,” the government said.

“This will provide a reliable supply of clean, affordable electricity for households and businesses across NSW while helping to meet the state’s newly legislated net zero targets.”

This is the first time the NSW government has competitively procured a new transmission network, adding that delay and cost overrun risks will be substantially borne by the network operator.

NSW Energy Minister Penny Sharpe said the latest announcements are a significant milestone for the Central-West Orana REZ which is expected to generate up to $10 billion (USD 6.76 billion) in private investment in the region by 2030 and at its peak support about 5,000 construction jobs.

“These milestones are an important step forward in the development of the Central-West Orana REZ, taking it from vision to reality,” she said.

“It brings us closer to delivering clean, affordable and reliable energy to households and businesses across NSW for decades to come, helping to meet newly legislated net zero targets in NSW.”

Sharpe said the next step for the Central-West Orana REZ is to complete regulatory and planning approvals, expected in mid-2024, ahead of the final contract with the network operator being awarded and financial close, scheduled for the second half of 2024.

If approved, construction is expected to start in early 2025, and initial operation in 2027-2028.

The Central-West Orana REZ is one of five designated clean energy areas detailed in the NSW government’s electricity roadmap, which will support more than $32 billion of investment in renewable energy generation, storage and transmission in the state.

REZs will also be developed in the New England, South-West, Hunter-Central Coast and Illawarra regions and are expected to bring 12 GW of renewable energy and 2 GW of storage online ahead of the planned retirement of the state’s aging thermal-generation fleet.