Genex to start construction at $602 mln Australian pumped-hydro project
20/05/2021 09:32
By Sonali Paul
MELBOURNE, May 20 (Reuters) - Genex Power GNX.AX reached
financial close on a long-delayed A$777 million ($602 million)
pumped-hydropower project at an abandoned mine site in northern
Australia, a possible model for other pumped-hydro projects to
back up renewable power.
Construction on Australia's first pumped-hydro project in
nearly 40 years, is due to begin in the next two months, aiming
to start supplying power in early 2025, Genex Executive Director
Simon Kidston said.
The 250-megawatt project is being built at an abandoned gold
mine in Queensland. When operational, it will pump water uphill
from an empty mine pit into a second empty pit when energy is
abundant and cheap, and release the water to generate power when
prices are high, working like a massive battery.
The project hinged on support from the Australian
government's Northern Australia Infrastructure Facility, the
state of Queensland, backing from Japan Electric Power
Development Co (J-Power) 9513.T , and a power supply contract
with power retailer EnergyAustralia, a unit of Hong Kong's CLP
Holdings Ltd 0002.HK .
"The challenges weren't in the technical feasibility. The
engineering was quite straight forward. Putting together the
commercial arrangements is what proved to be complex," Kidston
told Reuters.
"It's an 80-year life asset. It's going to produce solid
returns," he said.
After agreeing to invest A$25 million in Genex, J-Power now
has a 10% stake in the company.
"The project will provide the stability our system needs and
deliver reliable, affordable and cleaner energy,"
EnergyAustralia Managing Director Catherine Tanna said.
($1 = 1.2910 Australian dollars)
(Reporting by Sonali Paul; Editing by Christian Schmollinger)
((Sonali.Paul@thomsonreuters.com; +61 407 119 523;))