All the talk is on renewables, yet there are no major wind or solar projects currently under construction in WA’s South West.
If talk translated to action, Western Australia would be awash with new wind farms and solar farms.
The state government has committed to phasing out Synergy’s coal-fired power stations by 2030, with renewables to fill the gap.
It has also set aside funding to expand its own wind portfolio, and encouraged the private sector to invest.
That has fostered a long list of potential projects but, as we speak, nothing is under construction.
EY partner Ben Vanderwaal believes the state needs to get a move on.
“Are we moving fast enough to shore up our power supplies in WA to confidently enable the retirement plans for the Synergy coal fleet? I think no,” Mr Vanderwaal told Business News.
“There is a risk today [that] it takes more than four or five years to develop even advanced projects to fully commissioned and operational projects.
“The WA market is right at the point where serious action needs to be taken or there is significant risk the 2030 objectives will not be able to be met.”
The Australian Energy Market Operator (AEMO), which manages the WA market, raised similar concerns in its latest market outlook.
It expects a capacity shortfall will emerge from 2027-28 and worsen over the following five years as demand continues to grow and coal-fired generation is retired.
Executive general manager WA & strategy, Kate Ryan, said the projected shortfall would grow to 2,880 megawatts by 2033-34.
“Substantial and sustained investment in new capacity will be required beyond existing and committed capacity,” she said.
The long lead times for wind and solar farms are illustrated by the two most recent projects to enter the South West Interconnected System.
Italy’s Enel Green Power has commissioned its 75MW Flat Rocks wind farm near Kojonup.
Local company Moonies Hill Energy spent 15 years taking the project from inception to gaining environmental and development approvals.
Its work was capped off by the sale of the project to Enel in 2022, when it was ready to start construction.
It was a similar story with the recently commissioned Cunderdin solar farm and battery-storage project.
The project was bought by Spain’s GPG Naturgy after about a decade of development by local firm Sun Bred Power.
It is unclear what renewable project will follow next, despite the government making multi-billiondollar commitments.
Most of its spending is on largescale battery energy storage systems.
Synergy has already commissioned a 100MW battery at Kwinana, is building a second battery alongside the first (200MW), while also building a 500MW battery at Collie. The total cost is a cool $2.5 billion. Separately, French company Neoen is building a 560MW battery at Collie in two stages.
In addition, Alinta has built a 100MW battery at Wagerup and approved construction of a 300MW battery. Big batteries are a key part of the energy transition, allowing energy to be stored during the day or overnight and released when demand is peaking. However, they are only part of the solution.
State projects
On the generation front, the state government has outlined plans for three projects.
The first of these is meant to be a major expansion of the Warradarge wind farm in the northern Wheatbelt.
The 108MW expansion has been scheduled for delivery in the second half of 2025, but no contracts have been awarded for construction, casting doubt on whether that timeline can be achieved.
The unspoken but highly likely reason for the lack of progress is that two big investors that own most of Warradarge are trying to sell their stake.
Warradarge, along with the Greenough River solar farm, the Albany wind farm and several assets in other states, are owned by Bright Energy Investments.
Bright is 80.1 per cent owned by global investor DIF Capital Partners and Australian super fund Cbus, with Synergy holding the balance.
DIF and Cbus appointed Macquarie Capital early this year to sell their equity stake, making it highly unlikely an expansion at Warradarge will be signed off until a new owner is found and the sale is closed.
A second major investment planned by Synergy is development of its own wind farm, at King Rocks in the eastern Wheatbelt.
That 150MW project has all relevant approvals in place, yet the scheduled delivery has slipped back to the June quarter of 2026.
A third state government project is the Water Corporation’s Flat Rocks stage two wind farm, with capacity of 92MW and potential to double that.
The Water Corp has traditionally been a big buyer of renewable energy, in order to power its desalination plants.
It bought the development rights to Flat Rocks in 2022, even though it has never built or operated a wind farm.
At the time of the purchase, then water minister Dave Kelly said Water Corporation “will soon assess tenders to construct Flat Rocks wind farm stage two”.
That still has not happened, with the government saying the delivery date is the June quarter of 2026.
Private projects
There is a plethora of private sector projects at various stages of development across the South West, but none in construction.
Project proponents include some of the existing operators, such as Collgar Renewables.
It owns a 222MW wind farm at Merredin, the largest in WA, and is known to be assessing multiple new developments with the backing of its shareholder, giant super fund REST.
Another proponent with deep pockets is investment group Foresight, which two years ago teamed up with oil and gas company Shell to buy the Kondinin project in the eastern Wheatbelt.
Stage one of the project comprises a 120MW wind farm.
Later stages could add 114MW of wind, 80MW of solar and a 60MW battery.
In its recently published 2024 annual report, Foresight said it had obtained development approval for the project.
“Ongoing development activities have included offtake marketing, EPC tendering, grid connection and community engagement,” it said.
Tilt Renewables, which operates several wind farms on the east coast, is continuing to pursue development of its Waddi project in the northern Wheatbelt, while ASX company Frontier Energy is advancing plans for its Waroona solar project south of Perth.
A new entrant to the market is Green Wind Renewables, which has partnered with Macquarie Group offshoot Aula Energy to work on four possible projects in WA.
Green Wind recently unveiled early stage plans for its first proposed development: the Ambrosia wind farm, located on agricultural land 55 kilometres south-east of Collie.
It said the project would host up to 100 wind turbines, with capacity to produce more than 600MW of power.
Also active in the market is Melbourne-based Wind Prospect, which specialises in gaining approvals for projects that can be on-sold.
It has done this 24 times, including twice in WA: at the Yandin wind farm (operated by Alinta) and at Waddi (now owned by Tilt Renewables).
Wind Prospect is currently undertaking early stage feasibility studies for the Twin Hills wind farm, near Eneabba to the north of Perth.
Its plans envisage 140 wind turbines capable of generating 930MW of electricity.
As well as onshore projects, there is longer-term potential for offshore wind farms, subject to the federal government defining an offshore wind zone near Bunbury.
Of all the proposed renewables projects in the South West, most are wind farms.
That’s because the need for solar is overwhelmingly being met by distributed solar, or rooftop solar, in metropolitan Perth.
The number of rooftop solar installations in WA is growing by about 40,000 per year and totalled just more than 491,000 at the start of this year, according to estimates by Energy Policy WA.
That lifted production from distributed solar to 3,175 gigawatt hours in FY23, more than eight times larger than output from large-scale solar farms.
For context, the output from wind farms in the South West was slightly larger, at 3,316GWh.
Collectively, renewables accounted for 34 per cent of SWIS generation output (see graph).
Transparency
Western Power is one organisation with a detailed insight into what’s coming.
It runs a registration-of-interest process for new generators, to help with its planning for the transmission network. However, the utility does not publish that information.
Mr Vanderwaal believes the time has come for increased transparency.
“The WA regulations for the government-trading entities and AEMO are overly complex and onerous in terms of confidentiality,” Mr Vanderwaal said.
He contrasts the practice in WA with the National Electricity Market on the east coast, for which AEMO publishes a list of generation projects and their stages of development.
This covers both the retirement of existing generators and development of new generation assets.
“I think it would be very valuable for the WA market to have a similar publication,” Mr Vanderwaal said.
“It would be sensible for AEMO to mirror that function in the WA market. That would be very helpful.
“It would improve transparency around the location of generation assets, and that drives where the transmission investment needs to occur.”
Long process
Mr Vanderwaal has identified a number of hurdles facing developers of wind and solar farms in WA.
The time-consuming process includes securing land and gaining development approvals and environmental approvals.
“Those processes could be improved but they are able to be navigated,” Mr Vanderwaal said.
A more critical step in the process was the ‘offer to connect’ from Western Power. “This requires significant front-end investment in technical modelling,” Mr Vanderwaal said. “This really is a bottleneck.” He supported changes that would allow project developers to complete the technical work and prepare a submission. “This would mirror what happens on the east coast, where the proponent typically packages up all that work,” Mr Vanderwaal said. “There is a fairly well-defined assessment process [on the east coast].”
He said the largest issue for project developers was finding an assured market for their energy output.
“The biggest blocker in WA at the moment is securing an offtake agreement, or a power-purchase agreement,” Mr Vanderwaal said.
“The large industrial customers have got their energy supply contracts in place and they haven’t been quite ready to forward contract for the next ten to fifteen years, so we are in a bit of stalemate.” It’s not just caution on the part of industrial customers; in several key cases their fortunes have taken a turn for the worse. BHP’s decision this year to suspend its nickel operations has created a lot of uncertainty for three renewable energy projects. Risen Energy’s 100MW Merredin solar farm was contracted in 2021 to supply power to BHP’s Kwinana nickel refinery. Enel’s Flat Rocks wind farm, which has been jointly owned by Japan’s Inpex since last year, was contracted in 2022 to supply BHP’s Kalgoorlie smelter and Kambalda concentrator.
Canada’s TransAlta Corporation has a 16-year offtake agreement with BHP to supply power to the Mt Keith and Leinster nickel mines.
The power comes from TransAlta’s 27MW solar farm at Mt Keith and a 10.7MW solar farm at Leinster, along with a 10MW battery.
It remains unclear how each of these operators will respond to the nickel closure.
The lithium industry was expected to be a big driver of demand as newly built refineries sought clean energy supplies.
However, that sector has grown much less than expected.
Tianqi Lithium is still battling to achieve nameplate capacity on its first processing train at Kwinana and has deferred construction of a second train.
Albemarle Corporation was originally planning four processing trains at Kemerton but has halted expansion work while it focuses on ramping up train one.
Covalent Lithium has not yet started production at its Kwinana refinery.
The alumina industry was seen as another driver of demand, but the news there has not been positive, either.
Alcoa has shut down its Kwinana refinery, the oldest of three in its portfolio, while South32 has raised doubts about the long-term viability of its Worsley Alumina refinery, as it challenges proposed environmental rules.
Circuit breaker
Mr Vanderwaal suggested the federal government’s Capacity Investment Scheme could have a significant, positive impact.
“I think it will be a circuit breaker,” he said.
“It is designed to de-risk the commercial returns for a project.
“I expect that will catalyse the next couple of projects that are very advanced.”
Under the scheme, which needs projects with a near-term delivery date, the federal government will underwrite developers to build 6.5 terawatt hours of new wind and solar in WA as well as 1.1 gigawatts of new storage.
“It means they can reach financial close without a power purchase agreement,” Mr Vanderwaal said.
“They are effectively taking a level of merchant risk, where they will sell their power into the wholesale balancing market.”
Developers will need to wait some time, however, as the first CIS tender, currently under way, is targeting dispatchable capacity.
In practice, that likely means batteries, which control the amount of power they dispatch into the grid.
Energy Minister Reece Whitby said the Capacity Investment Scheme was set to bolster WA’s decarbonisation efforts.
“The procurement of additional storage will be critical for firming wind and solar power during peak demand, complementing existing public and private investment in big batteries in Collie and Kwinana,” he said.
