Grassroots Renewable Energy, the Australian platform owned by Partners Group and CWP Renewables, has signed a power-purchase agreement with Sydney Airport to provide up to 75 percent of the transport hub’s power.
Sydney Airport announced this week that it had signed a memorandum of understanding with Grassroots Renewable Energy and Origin Energy, with Origin to provide baseload firming supply.
Grassroots’ power will be supplied by the under-construction Crudine Ridge Wind Farm near Mudgee, New South Wales, which is expected to be fully operational in late 2019. The wind farm will have 37 turbines and a capacity of 137MW, capable of generating 400,000 MWh annually.
The agreement with Sydney Airport accounts for approximately 95,000 MWh annually or almost a quarter of Crudine Ridge’s output, an airport spokeswoman said, with some of that to be provided by Origin Energy if needed.
Sydney Airport would not disclose the level of cost savings it expects to make through the agreement, but the spokeswoman said it would be “significant” and this was the first step in the airport’s move toward renewable energy sources. Sydney Airport has set a carbon emissions reduction target of 50 percent by 2025.
The memorandum of understanding is the precursor to signing formal contracts, so no fixed time for the length of the PPA has been set.
Sydney Airport’s statement to the ASX said the agreement was “opening the possibility” of all three parties working together again on energy services provision in the future.
Half of Crudine Ridge Wind Farm’s energy has already been sold to Powershop, an Australian energy retailer, Grassroots announced at its launch in May, with the organisation in talks with other potential corporate buyers for the rest of its output.
Partners Group invested A$700 million ($510 million; €440.5 million) in Grassroots Renewable Energy at its launch and seeded it with the 270MW Sapphire Wind Farm, in which Partners Group made its initial A$250m investment in 2016.
Renewable energy projects are increasingly seeking PPAs to underpin investment, particularly considering the uncertain energy regulatory environment in Australia following the collapse of the federal government’s National Energy Guarantee. PPAs for renewable energy have been signed by several large corporations, such as the agreement Telstra, ANZ, Coca-Cola Amatil and the University of Melbourne, signed with RES and Macquarie Capital’s Murra Warra wind farm, last December.
In June, Australian steel company BlueScope signed a seven-year purchase agreement with ESCO Pacific. Under the terms of the agreement, which was billed as “the largest corporate PPA announced with a solar farm in Australia”, BlueScope will purchase 66 percent of the output of the 133MW Finley Solar Farm project.