$236 million renewable energy boost for central west New South Wales

31 March

Central west New South Wales will receive a boost in renewable energy, with the development of a $236 million 113 MW wind farm, near Wellington.

The Turnbull Government, through the Clean Energy Finance Corporation (CEFC), is investing $80 million in the Bodangora wind farm project, which is the CEFC's second major investment in wind generation in regional NSW in the past year.

The Bodangora wind farm is expected to generate enough clean energy to power more than 49,000 homes.

The project will also benefit the local community by providing opportunities for direct employment during the construction phase, and indirectly through local service providers.

This investment in large-scale renewable energy projects such as Bodangora, is part of the Turnbull Government's technology neutral, non-ideological approach to provide affordable, reliable electricity as we transition to a lower emission future.

The Bodangora wind farm is expected to be operational in the latter half of 2018.

This investment brings the amount of finance the CEFC has committed to the renewable energy sector in New South Wales to $350 million in the past four months.

Source: Federal Government

 

Bodangora Wind Farm to proceed to construction

3 April

Infigen Energy (ASX: IFN) today announced that it would proceed to construction of the 113.2 MW Bodangora wind farm near Wellington in New South Wales, having achieved financial close.

Bodangora wind farm will be built by a consortium comprising General Electric (GE) and civil-engineering construction company Civil & Allied Technical Construction (CATCON) under an engineering, procurement and construction (EPC) contract.

Infigen Energy’s Managing Director Ross Rolfe said, “We have been delighted to work with our partners in bringing this project to fruition. Critical to our success has been the role played by the Clean Energy Finance Corporation (CEFC) and NORD/LB, in providing Infigen with $163 million debt facilities.”

Revenues will be supported by a power purchase agreement (PPA) with EnergyAustralia for 60% of the annual output produced over the period to December 2030. The balance of output will be available for Infigen to contract to commercial and industrial customers, or to sell on the spot or wholesale market. The project is targeted to be fully operational in the second half of 2018.

The project will create a substantial number of jobs and stimulate significant economic activity in the local region. The project will provide approximately 120 direct jobs during construction and seven full-time jobs during its operating life. Infigen looks forward to continuing to build strong links with the local community through these activities.

“The Bodangora project is set to deliver a substantial increase in clean energy in regional New South Wales, and is well positioned to capitalise on the state’s natural strengths in renewable energy. We have been pleased to work with Infigen and NORB/LB to accelerate the development and delivery of this important project,” said Andrew Gardner, CEFC Wind sector lead.

“Together with CEFC, we are proud to have been able to support Infigen and GE with their Bodangora wind farm by providing a long-term financing package, tailored to the project’s partially-contracted revenue structure. NORD/LB is committed to developing its presence in the Australian energy market with renewable energy generation being at the core of our strategy,” said Olaf-Alexander Wiedemann, CEO, NORD/LB Asia-Pacific.

Geoff Culbert, President & CEO, GE Australia, New Zealand & Papua New Guinea, said, “We are pleased to bring energy experience and expertise to the Bodangora wind farm. The 33 GE 3.43 wind turbines to be installed are part of our newest, most powerful and scalable platform. Through our service and maintenance agreement, we also look forward to adding maximum value to the project for years to come.”

Infigen owns 100% of the project, having acquired the 50% interest in the project that it did not own prior to financial close. As owner of 100% of the project, Infigen will provide 100% of the equity funding for construction and will operate the wind farm.

Source: Infigen Energy

 

Infigen Energy launches fully underwritten $151 million capital raising

3 April

Infigen Energy (Infigen) today announced a fully underwritten capital raising of approximately $151 million and increased FY17 underlying EBITDA guidance to $147 million1.

Key highlights:

  • Fully underwritten 1 for 4.6 pro-rata accelerated non-renounceable entitlement offer to eligible Infigen Security Holders to raise approximately $151 million, comprising:

o Accelerated institutional entitlement offer; and

o Retail entitlement offer.

  • Entitlement offer price of $0.89 per new security, which represents a discount of:

o 9.6% to the theoretical ex-rights price of $0.984; and

o 11.4% to Infigen last close price of $1.005 on 31 March 2017.

  • TCI Security Holders2, which hold 32.1% of Infigen's total issued securities, have pre-committed to take up their respective entitlements in full.

o TCI Security Holders have also committed to sub-underwriting3 a portion of the retail component of the entitlement offer for up to 16.9 million securities.

o the maximum TCI Security Holders interest in Infigen's total issued securities (whether physical or via cash-settled swaps) if all sub-underwriting were called would be 33.9% of Infigen’s total issued securities.

  • Increased full year FY17 underlying EBITDA guidance to $147 million1 based on eight months unaudited actual results.

o 22% higher than the previous corresponding period (FY16) and 5% higher than previously communicated guidance of $140 million.

Together with existing cash reserves, the proceeds from the capital raising will be used to implement Infigen's business strategy including developing wind and solar opportunities by:

  • financing the equity component of new projects including the construction of the ~113MW Bodangora wind farm; and
  • increasing balance sheet flexibility to facilitate a potential refinancing of two existing Infigen debt facilities.

Infigen’s Managing Director Mr Ross Rolfe explained that the Australian energy market is in transition from a high emissions past to a lower emissions future.

"With this capital raising, Infigen is positioned to play its part in that process," Mr Rolfe said.

"Currently over 75% of Australia's electricity generation is supplied by coal fired plants. Much of this capacity is due to retire over the next two decades creating the opportunity to replace it with cleaner sources of generation. Infigen has a pipeline of mature development projects to draw from in delivering some of the new capacity that the market will require."

"The capital raising announced today, in combination with existing cash reserves, will enable Infigen to deliver the Bodangora wind farm, which reached financial close on 31 March, and pursue other growth projects in the future. Bodangora represents the first significant milestone in delivering on Infigen's growth ambitions," Mr Rolfe said.

Mr Rolfe said that the capital raising would also enable Infigen to continue to progress its plans to implement a more flexible capital structure to support the company's growth ambition, including continuing to explore the optimal timing and terms for a refinancing of the company's Woodlawn and Global debt facilities.

1 Excludes profit on sale of Manildra solar development project of $4.3 million and $5.7 million fair value uplift relating to the Bodangora aquisition.

2 Two entities to which TCI Fund Management Limited provides investment management services (including exercising voting control over such securities).

3 In aggregate on economically equivalent terms to other sub-underwriters (including any sub-underwriter fees that will be paid out of underwriting fees). Any increase in TCI Security Holders' position under the sub-underwriting arrangements would be economic, via cash-settled swaps rather than an increase in physical security holding (unless TCI Security Holders obtain approval from the Foreign Investment Review Board (FIRB) to increase their respective physical security holding).

Source: Infigen Energy

 

Tax Cuts, Power Prices & Solar Thermal Plant at Port Augusta

1 April 2017

After lengthy negotiations between the Nick Xenophon Team and the Federal Government, Senator Nick Xenophon and his colleagues have secured a landmark package of measures designed to put downward pressure on household and business electricity and gas bills.

These were conditional changes in return for the NXT moving from $10 million to $50 million for small and medium business tax cuts.

A range of measures have been agreed to that will break an investment strike in the utilities sector and bring greater supply to market which will ultimately see reduction in electricity and gas price and “will be good for mums and dads and small business owners alike.”

The energy package includes:

  • A firm deadline to bring about changes to National Electricity Market Rules by 1 July 2018 – these changes, properly designed and implemented, will bring investment certainty to the electricity sector and put in place measures that will bring electricity prices down whist increasing electricity security.
  • A ‘use it or lose it’ policy that will force gas companies that are sitting on huge gas reserves, such as beneath the Bass Strait, to bring cheap gas to market or hand the tenements over to companies that will.
  • A commitment by government to use its powers to ensure Australian gas is directed to the domestic market if voluntary agreement is not reached with gas companies by 1 July 2017. Furthermore, the Government has committed to longer term public interest requirements to be met for all future gas export contracts.
  • An agreement by government to implement gas pricing and capacity transparency recommendations of the ACCC gas and Vertigan inquiries by 1 July 2017 to ensure that businesses negotiating gas supply contracts are not negotiating in the dark.
  • An agreement that the Productivity Commission will examine the effect and appropriateness of gas company joint venture arrangements in the market place where there are limited suppliers.
  • A $110 million low-interest loan from the Federal Government for installation of the Solar Thermal Plant in Port Augusta that will provide effective baseload power and hundreds of jobs to Port Augusta.
  • A one-off energy assistance payment of $75 for single recipients and $125 for couple recipients of the Aged Pension, the Disability Pension and the Parenting Payment to provide relief for those most vulnerable to power price rises.

“This is a valuable step that will assist small to medium businesses, and with the additional agreement from the Government, will also protect household consumers,” said Nick.

“This tax cut is not a win for multinational companies trying to avoid tax. This is not a win for big business. This is not a win for the top end of town. This is a win for everyday Australians.

“Businesses such as the local family-owned IGA, who have a high turnover but low margins, will now be able to compete more effectively against the supermarket giants of Coles and Woolies. The ALP – which has previously supported corporate tax cuts - the unions and GetUp have campaigned against these changes. Why would opponents of these tax cuts not want to give your local family-owned IGA a fighting chance to compete with the supermarket giants of Coles and Woolies?

“We need to put an end to the investment strike that we have in this country where investors won’t invest in Australian energy markets simply because of the policy uncertainty. The changes to the National Electricity Market Rules will give that policy certainty.

“We are paying in Australia three times the spot price of gas in the US and double the long-term contract price in Japan. Why is it that the gas we are exporting to Japan, costs twice as much here as it does there? There is something seriously wrong with our gas market and these measures will mean more gas on the domestic market.

“The Government foreshadowed last election that they would construct a solar thermal plant in South Australia. This has now been elevated as a key government policy. It will provide effective baseload power and will create hundreds of jobs in Port Augusta as well as replacing more than the jobs that were lost when the Alinta power station closed. This will be a flagship project for the rest of the country that will show renewables can be an effective baseload as well.

“Families are doing it tough at the moment. The one-off payment to pensioners will make a real difference in taking the pressure off all households who face a tough winter of high energy bills.

“It is my view that bringing energy costs down and providing energy security is of critical importance to the future of Australia, and will deliver benefits that in the short to medium term will outweigh any tax cuts to businesses, particularly given the magnitude of forecast energy price increases in coming months.”

Source: Nick Xenophon

EDITOR’S NOTE: Final project choice to be decided by a tender process and dependant on a power purchase agreement with the South Australian government. 

 

Tenders for Kidston solar project

3 April

Work packages have been released on the icngateway for the Kidston Solar Project located on the old Kidston gold mine near Georgetown around 270kms northwest of Townsville.

Phase one of the project is expected to generate 145GWh of electricity which is enough to power more than 26,480 homes.

UGL has the EPC contractor. Completion date is January 2018.

Open listings include:

  • Fencing components – Open 31 Mar 17 :: Close 12 Apr 17
  • Concrete Works – Open 31 Mar 17 :: Close 16 Apr 17
  • Earthworks Equipment and Crane Hire – Open 31 Mar 17 :: Close 16 Apr 17

FURTHER ASSISTANCE

UGL strongly encourages local industry to contact the ICN Queensland in the first instance to improve their understanding of the EOI process.

UGLs primary contact is:

Mr Trevor Noble

Project Manager

E-mail: 3200-0530.Kidston@ugllimited.com

Source: Industry Queensland

 

Canadian Solar appoints Entura as Owner’s Engineer for two solar farms in Queensland

5 April

Specialist power and water consulting firm Entura has been appointed by Canadian Solar, one of the world’s largest solar companies, as Owner’s Engineer for two solar farms in Queensland.

The two solar power projects, located in Longreach and Oakey, Queensland, are 17 MWdc and 30 MWdc each in size. Both projects have been awarded funding by the Australian Renewable Energy Agency (ARENA). With the 20-year Queensland government-backed Contract for Difference in place, both of the projects are expected to start construction in May 2017 and reach Commercial Operations Date in the first quarter of 2018.

As Owner’s Engineer, Entura will review designs, documentation, calculations and reports produced by the engineering, procurement and construction (EPC) contractor to ensure they are fit for purpose and in accordance with Australian standards and regulations.

“We’re pleased to partner with Entura on the Oakey and Longreach solar farms,” said Daniel Ruoss, General Manager at Canadian Solar. “Working with Entura and leveraging on our strong local and global project development and execution capabilities, and with the support from Local and Federal Government, we will continue to expand and execute our quality solar project pipeline in Australia, thereby making a significant contribution to the adoption of clean solar energy in the country.”

Commenting on the appointment, Entura Managing Director Tammy Chu said: “We’re pleased to partner with Canadian Solar on these exciting projects that will contribute to the introduction of more renewable energy to the Australian National Electricity Market.” 

Source: Entura

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