Sphere Quarterly Newsletter

Quarter 3 2023 Highlights | October 2023

Public sector and policy

Public sector and policy updates from Q3 2023.

Towards net zero

AUS Government Identifies New Region for Future Offshore Wind: in Jul-23, the Australian Government declared the area off the Hunter, NSW suitable for future offshore wind development. The announcement signals the potential for the area to generate up to 5GW of renewable energy, sufficient to power 4.2 million homes and create more than 4,500 jobs. 

Scoring system for new renewable grid infrastructure announced: In Aug-23, the Victorian Government announced the appointment of VicGrid, a newly formed agency established to coordinate the delivery of critical transmission infrastructure and support offshore wind development in the Gippsland region. The announcement will support Victoria in taking advantage of opportunities from the once-in-a-generation energy transition.  

EnergyAustralia Release 5Bn Climate Transition Action Plan (CTAP): EnergyAustralia set out its strategy to achieve net zero by 2050 across scopes 1 and 2 emissions in its Climate Transition Action Plant (CTAP). The plan includes the expected deployment of more than $5Bn in capital for renewables and a focus on partnerships to deliver up to 3GW of operational assets by 2030.

WA Government announces energy and governance legislation reform: Energy Policy WA announced plans to develop an energy regulatory framework in Aug-23, supporting the state to maximise the opportunities for energy sector transformation, improving the management of decarbonisation initiatives and maintaining a secure and reliable energy supply. 

CEFC announces plans for $3Bn affordable and secure renewable energy investment: A landmark agreement was signed between the Australian Government and the Western Australian Government in Aug-23, including the provisions of $3Bn to support the State’s uptake of affordable and secure renewable energy.

QLD outlines plans for a renewables cluster and clean energy hub: The QLD Government unveiled the first look at the Stanwell Clean Energy Hub development project in Aug-23. The hub will provide the sandbox environment to test innovative energy technologies and unlock new industrial jobs in hydrogen, renewables, manufacturing and critical minerals. 

AUS government signals development need for National Electricity Market: A 10-year reliability outlook published by the Australian Energy Market Operator (AEMO) in Aug-23 signals the urgent need to deliver new investments in transmission, generation and storage projects to avoid reliability gaps.Hotter temperatures, drier conditions and coal-fired generation at historic lows are expected to influence the uptake in electricity demand.

NSW announces $1.8Bn Green Bank: the NSW Government announced it will commit up to $1.8Bn via the newly established Energy Security Corporation to support the State’s transition to cleaner, affordable energy. The funding will help to:

  • Support the development of NSW’s first renewable energy zone (REZ) in Dubbo; and

  • Provide funding to other planned REZs such as the Hunter Transmission Project and Waratah Super Battery. 

Towards a circular economy

QLD Government Release SEQ City Deal Plan: in Jul-23, the Australian Government and QLD Government released the South East Queensland (SEQ) City Deal implementation plan. The plan introduces a joint pathway to deliver $1.8Bn worth of projects including a $105M resource recovery facility to support the State’s transition to a circular economy. 

Reducing Landfill and Improving Recycling Capacity in QLD: the Australian Government and QLD Government announced funding of 6 new recycling plants. The additional investment will increase the State’s waste recycling capabilities, boost local jobs in the South East QLD region and support the development of circular economies. 

BP completes feasibility study to develop green hydrogen hub in WA: Western Australia is closer to the creation of a large-scale green hydrogen hub after BP confirmed the completion of a feasibility study to develop the H2 Kwinana project. BP is now closer to achieving a final investment decision and supporting the State’s transition to net zero by 2050. 

AUS Government Announce Decarbonisation Plans: the Australian Government outlined its commitment to working with industry stakeholders to develop a sectoral decarbonisation plan and promote the circular economy. The commitments include plans to address cross-cutting issues across sectors such as transport, agriculture and land, industry and electricity and energy. 

Investment of $151M secured for QLD Food Organic and Garden Organic (FOGO): the QLD Government announced it will invest $151M to support the implementation of FOGO waste collection services, including the roll-out of more than 1 million lime-green lidded organics bins and kitchen caddies. Funding allocated to FOGO projects supports the delivery of the SEQ Waste Management Plan, Queensland Organics Strategy and Action Plan, and accelerates the state's transition towards a circular economy.

Australian Carbon Credit Units (ACCU) discussion paper review: the Waste Management and Resource Recovery Association of Australia (WMRR) facilitated an online review of the ACCU discussion paper in Sep-23.The Australian Government is seeking views on the ACCU review with a focus on implementing new scheme principles, and publication requirements, and delivering a new process for method development among other consultation items. 

General government

NSW Government budget announcement: the New South Wales Government 2023-24 Budget was delivered in Sep-23. Key infrastructure announcements and updates included:

  • $3.6Bn to support the clean energy transition including commitments to the Transmission Acceleration Facility, reserves for the Energy Security Corporation and funding for the Zero and Low Emission Vehicle Reform. 

  • Funding for the Treasury infrastructure program which focuses on the delivery of the Electricity Infrastructure Roadmap, with an additional budget of $804M provisioned to guide NSW renewable energy over the next decade and support the development of Renewable Energy Zones (REZs). 

  • $224M allocated to deliver five measures of the Murray-Darling Basin plan, to achieve similar or better environmental outcomes for rivers, wetlands and wildlife using less water.  

  • Capital investments by public non-financial investments, Hunter Water Corporation, Sydney Water Corporation and Water NSW increased by $20M, $881M and $148M, respectively. 

  • Funding announced for the Lord Howe Island Waste Management Facility upgrade to ensure compliance with legislative and regulatory requirements. 

Change in Victorian Premier: Jacinta Allan succeeded Daniel Andrews to become Victoria’s 49th premier. Mr Andrews presided as the Premier for a 9-year period during which the Victorian state increased renewable energy in the grid from 11% to 37%. 

Projects and transactions

Projects and transactions updates from Q3 2023.

Towards net zero

WA Hydrogen project to include 900 MW Solar Farm: Traditional owners as part of the Aboriginal Clean Energy (ACE) partnership will partner with clean energy investor Pollination to build a 900 MW solar farm as part of the proposed $3Bn East Kimberley Clean Energy Project. Once installed, the project will be Australia’s first 100% renewable energy hydrogen hub. 

Increased capacity of Western Downs Battery in QLD: Neoen is expanding its Western Downs Battery in Queensland to a total installed capacity of 270 MW (up from 200 MW). The expansion will enhance its role in Queensland’s fast-growing energy transition, leveraging Tesla technology and the existing infrastructure of the Western Downs Green Power Hub. 

International MOA signed to study and develop hydrogen-related businesses in AUS: Electricity Generating (Egco), a company listed on the Thai stock exchange and the power generation division of the state-run Electricity Generating Authority of Thailand, is actively expanding its clean energy portfolio through an MOU with Diamond Generating Asia to produce green hydrogen at the Boco Rock wind farm in NSW. 

Zenith Energy closes debt financing to strengthen project pipeline development: Zenith Energy closed a $320M debt deal from a mix of existing and new lenders. The capital raised in the transaction will help the mine site power business expand its existing energy infrastructure portfolio and pipeline in Australia which currently includes 600MW of contracted capacity. 

AUS Green Bank Invests $1.9Bn in 2022-23: the Clean Energy Finance Corporation (CEFC) confirmed it has invested $1.9Bn in new investments throughout the 2022-23 financial year. In a press release issued in Aug-23, the Green Bank reported that the financing had helped to bring forward 14 large-scale solar, wind and storage projects through ongoing work arrangements with investors and project developers. 

Pacific Partnerships Acquires 300MW QLD Solar Farm: CIMIC Group’s investment arm, Pacific Partnerships, acquired a 300MW QLD solar farm from Renewable Energy Partners in Aug-23. The project will be developed within the Southern Queensland Renewable Energy Zone, a region that has close to 2.2 GW of committed renewable energy projects. 

Hanwha Energy to sell solar and battery energy storage system (BESS) projects: Hanwha Energy Australia announced plans to sell a portfolio of renewable energy assets, including a solar farm, battery and energy storage system projects (BESS) in NSW. The South Korean investor is expecting to announce an investment partner before the end of the year. 

Octopus Australia Raises $250M: Specialist renewable energy developer and fund manager, Octopus Australia, confirmed a $250M capital raise, adding superannuation fund Rest to its investor base. The investment will help accelerate the development of renewable energy development projects across wind, solar and storage technologies. 

New Zealand Green Investment Finance (NZGIF) secures $170M investment: the New Zealand Green Investment Finance (NZGIF) secured NZD 170M in capital to launch its Solar Finance programme. The programme is the first private debt placement achieving Climate Bonds Initiative certification with the fixed debt being used to accelerate distributed solar in Aotearoa New Zealand. 

Global pension fund acquires stake in Australian environmental markets platform: the leading global investment firm, Ontario Teachers’ Pension Plan (OTTP) announced it will acquire KKR and other shareholder’s stakes in the leading Australian environmental markets platform, GreenCollar. Freshly raised capital will enable the platform to continue investing in natural capital areas such as biodiversity and water quality. 

Zenith Energy complete concrete pour for wind turbine foundations: Zenith Energy announced the successful pouring of wind turbine foundations at the Kathleen Valley Project. Once constructed, the 95MW hybrid power solution will provide a minimum of 60% renewable energy to the neighbouring mine site owned by Liontown Resources Limited. 

Towards a circular economy

Brookfield signs MoU to manufacture renewable energy equipment in AUS: A MoU was signed between Reliance Industries and Brookfield Asset Management in Aug-23 to explore opportunities for the manufacture of renewable energy and decarbonisation equipment in Australia. The agreement seeks to accelerate Australia’s energy transition by developing local production capacity and infrastructure. 

Alteration Earth announces plans to acquire Verdant for USD159M: Alteration Energy confirmed it has entered into a non-binding heads-of-terms agreement to acquire Verdant Earth Technologies. The proposed acquisition will enable Alternation Energy to develop a network of sustainable biomass projects in Australia. 

Regional waste management business JRR for sale: the 65-year-old waste management services business, JR Richards & Sons (JRR) announced it is looking for new owners and has engaged a corporate advisor to identify potential buyers. Financials shared in early marketing for the business put JRR’s revenue at $203M and adjusted EBITDA at $24.8M for the 2023 financial year calendar. 

Morrison & Co Growth Fund acquire 50% of packaging and recycling company: Global infrastructure investment manager, Morrison & Co, announced it will acquire 50% of Pact Group’s Crate Polling business to expand growth opportunities in Australia. In particular, the investment will enable Morrison & Co. to increase its exposure in reusable and recyclable plastic crates and produce bins used in fresh produce supply chains. 

$100M funding announced for SA Hydrogen Port: the Federal and South Australian Governments announced the finalisation of a $100M grant agreement to develop SA’s first, large-scale export terminal for hydrogen. The redeveloped port of Bonython is expected to attract private sector investment and host projects worth up to $13b, accelerating the state’s transition to a circular economy and net zero. 

NZGIF finances Eastland Geothermal plants in Eastern Bay: New Zealand's NZGIF confirmed it will provide debt financing to Eastland Generation for connection assets linked to a new geothermal plant in the Eastern Bay of Plenty region. The announcement will strengthen the region’s energy resilience, benefiting local industry and farming communities. 

Pacific Equity Partners to acquire 50% stake in EfW company LMS Energy: Sims Limited announced a definitive agreement to sell 50% of its stake in bioenergy and methane abatement company, LMS Energy in Sep-23. The assets will be acquired by Pacific Equity Partners (PEP), with the sale expected to occur in the second quarter of FY24. The announcement increases PEP’s exposure to growth initiatives across bioenergy and methane abatement sectors in the US, NZ and AUS.

Planning approval granted for $1.6Bn desalination plant in WA: the Metro Outer Joint Development Assessment Panel unanimously approved Water Corporation’s proposed $1.6Bn desalination plant in Alkimos WA. The proposed project will cater for the growing drinking water needs of the region, improving climate resilience and diversifying the reliance on traditional water sources.

Sphere at a glance

Sphere updates from Q3 2023.

Kate Dryden facilitated WMRR YP Grant Writing Workshop: on 8-Sep, Kate Dryden together with NSW Environmental Protection Authority (EPA), facilitated the WMRR Young Professional’s Granting Writing Workshop. The online interactive workshop focused on the practicalities of preparing, planning and writing grant applications. Sphere’s support of this workshop is an example of our dedication and belief that collaboration and knowledge sharing are key drivers of progress and improvement in our sector.

Sphere’s team is expanding: Sphere’s strategic growth plans for 2023 are well underway. If you are interested in joining our senior team of strategic and commercially-minded professionals to accelerate the world’s transition to a circular economy, please connect with us for a confidential discussion.