Problems at Sandfire's solar farm

Sandfire Resources has encountered problems at its $40 million solar farm at the Degrussa copper mine, about six months after an ASX announcement suggested the power plant had been successfully commissioned.

Business News understands that there have been commissioning issues integrating the solar farm’s electric system with the existing power operation, a diesel plant owned and operated by Pacific Energy through subsidiary KPS.

The solar farm itself is believed to work, but problems with related electronics and circuits led to sub-optimal performance.

The project is one of the first of its kind in the mining industry.

One industry source told Business News that engineers had refused to accept the project was completed to specifications, and that it had been turned off.

It is understood that issues with the solar farm have had no impact on production at the mine, however.

The solar farm has a capacity of 10 megawatts, with 6mw of on-site battery storage.

More than 34,000 photovoltaic panels were installed at the site, which is near Meekatharra.

In June, Sandfire told the market the facility had achieved full generation capacity.

"The facility is currently generating approximately 7mw of power, which is in line with seasonal expectations," the announcement said.

"Solar generating output will ramp up during the summer months to achieve the full 10mw functional capacity.

"Commissioning of the $40 million project commenced in March 2016 following installation of the last of the 34,080 solar photovoltaic panels.

"The project required electrical infrastructure to be installed including inverters to change the electric current from DC to AC, transformers and other electrical accessories and control systems.

"Testing confirms that the plant can perform in accordance with contractual specifications and validates the power purchase agreements covering the facility.

"Continual testing will be completed in June to ensure it can maintain stable operations at 100 per cent generation capacity." 

The project was built by Otoc (now known as Veris) and underpinned by a complex deal, with funding largely coming from the Clean Energy Finance Corporation and the Australian Renewable Energy Agency.

About $38 million of the $40 million cost came via those two federal government agencies.

Sandfire chipped in less than $1 million.

The solar farm is owned by French company Neone, while juwi Renewable Energy was responsible for project development, EPC and O&M.

When contacted, Pacific Energy told Business News it would be unable to respond as it were bound by confidentiality clauses, while Sandfire Resources was unable to comment.

Shares in Sandfire were up 0.7 per cent to $5.74 at the close of trading.