Acciona takes reins of Kwinana energy plant

Kwinana’s nearly completed waste-to-energy plant has been acquired by Acciona Australia, after the engineering firm bought out its former owners for $364.7 million.

The Australian arm of the Spanish engineering giant on Friday morning revealed it had reached an agreement with Macquarie Capital and Dutch Infrastructure Fund to assume control of the $700 million facility.

It means Acciona Australia will assume full responsibility for completing the build which was originally meant to be operational by the end of 2021.

The plant has been connected to the grid, Acciona has begun commissioning, and plans to start accepting waste into the facility ahead of completion by the end of 2024.

Acciona Australia chief executive Bede Noonan said the deal had been years in the making.

“Ultimately, I think we collectively just came together and worked out that Acciona is able to actually do what is a very unusual deal and is financially able and technically able to actually take over the plant,” he said.

“We were able to work with the previous owners and come up with a solution that enabled our challenges on the project to be resolved.

“That enables the plant to not only get finished, but to have an extra capital injection needed to get finished and to be really successful as a long-term asset for both our business and for Western Australia.”

Macquarie and DIF funneled $275 million of equity finance into the project in 2018, while federal government agencies Clean Energy Finance Corporation and ARENA committed $90m and $23m respectively.

Macquarie was made resonsible for delivering the project and Veolia was awarded the operating contract.

"It’s an exciting time for EFW, we look forward to operating the first facility of this kind in the country," a Veolia spokesperson said.

Scheme of arrangement documents filed with the federal court revealed the plant's former owners still held $395.5 million in secured debt on the project.

The plant’s creation has been anything but a smooth ride for its project partners since being announced in 2018.

It has been beset by years of cost hikes and timeline overruns attributed to COVID-19-spurred building and workforce issues, and a supreme court case which led to concerns Acciona was trying to exit the project, claims Mr Noonan refuted.

“We were never trying to get out of the project,” he said.

“The only thing we sought from the court was a ruling on what two sentences in the contract meant, and that was to do with force majeure.

“The court declined to give us an answer.”

Local governments eager to use the facility have also raised concerns about the implication of delays on their plans to feed waste into the plant.

The waste-to-energy plant will divert some 460,000 tonnes of municipal and commercial waste from landfill and generate 38 megawatts of baseload power, enough to power 50,000 homes.

More than 3,500 jobs have been created during construction and about 50 permanent roles will be needed during the plant’s 25-year operational life.