New CIS tender seeks 2 GWh clean dispatchable capacity for Western Australia

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The pending Capacity Investment Scheme (CIS) Tender 2 for the Western Australian Wholesale Electricity Market (WEM) seeks an indicative target of 500 MW of four-hour equivalent dispatchable capacity.

A briefing paper released by AEMO Services outlines eligibility for projects which includes having a minimum storage duration of two hours, a minimum size of 30 MW and an eligible renewable energy source as per the Renewable Energy (Electricity) Act 2000, such as solar but not fossil fuels, materials, or waste products.

Virtual power plants (VPP)s, demand response or other virtual aggregation and flexible loads are not eligible in the tender, however the briefing paper indicates the government is considering their inclusion in future tender rounds.

The tender process follows three stages, with the first being the project bid to assess its technical, commercial, and First Nations and community engagement merit.

Possible community and First Nations benefit commitments proponents must demonstrate, include inviting local community to coinvest in the project with profit sharing arrangements or novel approaches to electricity access scheme where local communities benefit from lower prices and/or greater energy security through access to small scale solar and battery installations.

Projects successful in the WEM dispatchable capacity Tender 2 will contribute the overarching purpose of the CIS, to generate investment in renewable capacity and clean dispatchable capacity projects to deliver an additional 32 GW of capacity by 2030 and achieve the government’s 82% renewable electricity by 2030 target.

The Australian Energy Market Operator (AEMO) Services Limited will manage the CIS tender 2 process and is one of many six-monthly tenders to be released between 2024 and 2027.

Tender registration is expected to open later this month.

Project bids on the CIS Tender 1 for 6 GW of renewable capacity generation across the National Electricity Market (NEM) officially closed 1 July 2024, but has already attracted 40 GW of variable renewable projects registered.

Pilot tenders were hosted in 2023, for NSW major energy projects totalling 1,075 MW of reliable capacity, resulting in three battery energy storage system (BESS)s and three VPPs.

A second CIS tender pilot for South Australia-Victoria assessment process is still underway, as it seeks to allocated 800 MWh to South Australia, 800 MWh to Victoria and an additional 800 MWh to either state based on project merits.

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