A Newcastle company’s massive plan for large-scale renewable energy projects in NSW reflects the “huge global investor appetite” in the sector, an analyst says.
“Australia stands to be a massive exporter of renewable energy,” Institute for Energy Economics & Financial Analysis director Tim Buckley said.
“The Australian wind and solar resource is second to none.”
The Newcastle Herald reported last Tuesday that the Hunter Street-based CWP Renewables had secured a $700 million investment from Swiss private equity firm Partners Group to build large-scale wind, solar and battery projects.
Partners Group has about $100 billion invested in private equity, real estate, infrastructure and debt for its international clients.
Mr Buckley dismissed the commonly-held belief that Australia’s energy system needed coal or nuclear power to be reliable.
“Technology has moved on. Coal is not flexible. Renewables absolutely gut the viability of coal-fired power.
“Nuclear is too slow to build and way too costly.”
He said Liddell power station in the Upper Hunter would “almost certainly close in 2022, as AGL plans”.
“AGL CEO Andy Vessey has bet his career on that decision, his board stands united behind him and the financial markets agree with him. As does Origin and EnergyAustralia.”
He said the price of renewable energy was falling and “with scale and low-cost capital comes ever lower prices”.
Mr Buckley said the world was heading into a “rapidly decarbonising global energy system at a rate that has been previously unimaginable”.
“I think the implications for Newcastle and the Hunter Valley are enormous.”
He said communities and workers would “both get screwed if there is no transition plan”.
“We have a decade or two to transition, but the time is now to stop adding more thermal-coal export capacity. The logical thing is to diversify, develop new industries and re-train workers progressively and sensibly.”
He had no doubt that the seaborne thermal-coal market was in “terminal decline”, adding that its eventual death was a certainty.
“The only question is if it will happen in 20, 30, 40 or 50 years,” he said.
NSW Minerals Council CEO Stephen Galilee said the global coal price had doubled and NSW exports had continued at or near record levels in the past few years.
“It's great to see more investment in renewables, alongside the significant investment in new and existing coal projects in NSW, and the construction of hundreds of new-technology coal power plants around the world.
“All energy sources are needed to meet growing global energy demand.”