Green retailer turns project developer -- Plans for 1600 MW

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With a 20% by 2020 renewables target in Australia all but official, activity in the country's wind market is picking up. Australia's largest green energy retailer, Origin Energy, is no longer satisfied just buying wind power generation, it is also positioning to become one of the country's leading wind farm developers.

A deal with the Australian end of German developer Epuron gives Origin the option to develop up to 590 MW of wind plant. Of that, it is definitely proceeding with 90 MW. "Origin now has the option over a strategic and economically competitive pipeline of wind projects, which Epuron has identified," says Origin's Karen Moses. Most of them are in New South Wales (NSW).

"The Epuron deal will see Origin build its own wind facilities for the first time, deepening integration in this area...and provides Origin with greater flexibility in managing our carbon, retail and generation portfolios."

The company will kick off with construction of the Cullerin Range wind farm in New South Wales, 30 kilometres west of Goulburn. Cullerin is slated for 15, 2 MW turbines with commissioning planned for 2009. A turbine supplier is yet to be selected. The forecast capacity factor for the wind farm is a high 44% and transmission is available nearby.

Cullerin will be followed by a project at Conroy's Gap, west of Yass, and another at Snowy Plains, north-west of Berridale. Like Cullerin they will have a rated capacity of 30 MW each and are fully permitted.

Origin was one of Australia's early contractors of wind projects, helping underwrite wind farms at Codrington and Challicum Hills in Victoria," says Moses. Today it buys electricity from about 180 MW of wind plant. Epuron, an offshoot of German Conergy, is diversifying into wind from solar thermal development. It owns 235 MW of wind plant, mostly in Germany. The Australian division was established in 2003.

Significant activity

Moses says the Epuron deal will help Origin meet regulatory requirements and "make a significant contribution to helping reduce the carbon intensity of the Australian economy and the federal government meet its target." The company's Martin Poole adds that he expects to see "significant activity in the wind industry over the next few years."

Origin also has a joint venture agreement with Macquarie Capital Group to develop, finance and construct the 1000 MW Silverton wind farm north-west of Broken Hill in NSW, a project Epuron announced in October. The A$2 billion proposal, to be lodged with planning authorities in March, is for a staged development. Stage one involves a 20 kilometre, 220 kV power line from the site to a substation at Broken Hill, which would enable 200-300 MW to be exported from the site.

The final stages involve the construction of a 260 kilometre power line from Broken Hill to the Victorian border. With that line in place, the capacity of the site could increase to 1000-1200 MW, says Origin. When complete, Silverton will be Australia's largest wind farm with up to 500 turbines and the potential to supply 4.5% of the annual energy needs of New South Wales, equivalent to one-third of Sydney's population.

The joint venture deal is enthusiastically supported by Epuron's Joachim Müller. "It brings together Macquarie Capital's strength in financing with Epuron's long-standing expertise in wind power. Substantial growth in renewable energy has recently begun to pick up in Australia. Our cooperation with Macquarie Capital puts us in a great position to cover a large part of this increasing demand," he says.

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