Renewable energy power agreement

Acciona has signed a two-phase agreement with Origin under which Origin will initially purchase the Renewable Energy Certificates (RECs) produced by Acciona Energy’s 46.5 MW Gunning Wind Farm, and both the power and RECs during the second phase.

Under the terms of the agreement, Origin will purchase the Renewable Energy Certificates produced by the NSW wind farm from 1 January 2012 for a period of two years. From 1 January 2014, Origin will purchase both the RECs and the electricity for a further eight years, or until the end of 2021.

The agreement gives each party the option to extend the power purchase agreement for a further five-year period.

The $147 million Gunning wind farm is located 15 km north-east of Gunning in the Upper Lachlan Shire, 70 km north-east of Canberra. It consists of 31 Acciona Windpower 1.5 MW wind turbines and is expected to meet the energy needs of approximately 23,250 New South Wales households each year.

“Acciona is pleased to have a power purchase agreement in place for the Gunning Wind Farm, which has been generating green energy that we have been selling into the national electricity market since April 2011,” said Brett Wickham, Director Generation for Acciona Energy.

He added that Acciona’s strong balance sheet had allowed the company to build and operate the Gunning Wind Farm without a power purchase agreement despite the difficult market conditions of recent years.

During the initial two-year phase, Acciona will continue to sell the electricity produced by Gunning into the wholesale pool.

“This means we will be contributing our carbon-free electricity into the overall electricity supply, which translates into lower overall wholesale electricity prices,” said Wickham.

There are positive signs that the Renewable Energy Certficate surplus that developed prior to the separation of the large- and small-scale Renewable Energy Targets (RETs) is almost behind us.

“This will provide the impetus for the industry to build further projects that will take Australia closer to achieving the Renewable Energy Target,” Wickham concluded.