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Australia’s CEFC commits $213m to large-scale solar

The amount of financing the government-run renewables financier has pledged to such projects has now exceeded its initial $190m target.

The Clean Energy Finance Corporation has committed a total of A$281 million ($213 million; €199 million) to seven projects under its 18-month-old solar financing programme, helping it beat its initial financing target of A$250 million.

The programme’s most recent transactions, announced today, include financings for three solar projects in Queensland and Victoria with a combined A$77 million investment. The facilities, which will add 165MW of solar power to the grid, are currently being developed by local company Edify Energy, which has also invested equity into the projects in partnership with German developer Wirsol.

The CEFC, Australia’s Commonwealth Bank and German bank Nord/LB have also pledged to a syndicated senior debt facility to fund these projects. The transaction is the country’s largest single solar financing deal to date, the CEFC said.

“The Commonwealth Bank and NORD/LB worked alongside the CEFC to complete the financing over a longer tenor, which is notable given the merchant price risk component of the project,” said Gloria Chan, who leads the CEFC’s large-scale solar programme. “We are seeing increasing confidence in the sector, and a growing appetite by investors to support both contracted projects and to take merchant energy price risk.”

The electricity generated from Queensland’s 57.5MW Hamilton Solar Farm will be sold to the grid on a predominantly uncontracted or merchant basis, while the 57.5MW Whitsunday Solar Farm, also in Queensland, has a 20-year power purchase agreement with the state government.

In Victoria, the 50MW Gannawarra Solar Farm is the state’s first large-scale solar farm, with a 13-year PPA secured with EnergyAustralia. The three projects are expected to become operational by early 2018.

The renewables financier has so far committed A$150 million to three large-scale solar schemes in New South Wales, as well as A$54 million to the Kidston Solar Project, a disused gold mine co-locating solar power generation and pumped hydro storage facilities. Separately, it also committed A$20 million in equity investment to the country’s largest solar farm at Ross River in Queensland.