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Neoen and Origin Energy enter into a Power Purchase Agreement for Large-scale Generation Certificates from the DeGrussa Solar Farm.

Leading French renewable energy firm Neoen will sell Large-scale Generation Certificates (LGCs) produced by the DeGrussa Solar Hybrid power plant to Origin Energy under a new 5.5-year Power Purchase Agreement (PPA).

The installation, which is the largest integrated off-grid solar and storage facility on a mine site in the world, is expected to generate more than 20,000 LGCs per annum for at least 5.5 years (the minimum expected mine life).

The 10.6 MW solar PV farm, which is coupled with a 6MW battery facility, was commissioned in May 2016 at the off-grid DeGrussa Copper-Gold Mine in Western Australia, owned by Australian mining company Sandfire Resources (ASX: SFR).

Neoen, the long-term owner-manager of the project, provided the construction equity, secured the financing from CEFC, and negotiated the engineering, procurement, construction and operational and maintenance contracts, with support from the Australian Renewable Energy Agency (ARENA).

Engineering, procurement, operation and maintenance are provided by juwi which initially developed the project.

The plant was constructed by OTOC Australia, a subsidiary of infrastructure construction and national spatial solutions company OTOC Limited (ASX: OTC).

Franck Woitiez, Managing Director of Neoen Australia, commented: “Establishing a major partnership with Origin Energy is a valuable achievement for Neoen. Origin is now part of the DeGrussa story, an Australian flagship project.

We see this Power Purchase Agreement as a mark of confidence from Origin to Neoen and the DeGrussa project, but also more generally as a sign that utilities are prepared to contract more projects to meet their 2020 renewable energy target.

Neoen has now established a strong presence in Australia with capabilities in development, financing and operations, and is delivering ambitious projects to seize these opportunities.”

Origin General Manager Wholesale and Trading Greg Jarvis said the new agreement provided another avenue for Origin to support renewable energy and meet its commitments under the Renewable Energy Target.

“Origin aspires to be Australia’s leading renewables company and we have the flexibility in our generation portfolio to significantly increase our interest in renewables over the next few years with plans to both build and contract new projects in solar and wind.

“PPAs such as this support and underpin further investment in the renewables industry.”

ARENA is providing a $20.9 million recoupable grant to support the project. ARENA CEO Ivor Frischknecht said the landmark agreement signalled growing industry confidence in off-grid renewable energy projects.

“Origin’s LGC purchase agreement for the Degrussa Solar Project sets a positive precedent for other large-scale off grid projects to secure buyers for generation certificates.

This is an important source of revenue that enables these projects to attract lower cost financing, making them more competitive overall,” Mr Frischknecht said.

Source: Neoen Australia Media Release

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