ESN Premium speaks with Chloe Hicks, executive director of strategy and policy at EnergyCo, about New South Wales’ Renewable Energy Zones (REZ) and its hopes for energy storage.
When discussing Australia’s energy transition, especially in the states of New South Wales, Queensland, and Victoria, it is likely not long before someone mentions REZs and how these “modern-day power stations” are serving as a catalyst for the country’s lofty energy ambitions.
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New South Wales has arguably seen the most progress out of all the states. Indeed, in April, EnergyCo announced that, through a competitive tender process led by AEMO Services, 3.56GW of solar PV, wind generation, and battery energy storage systems (BESS) had been granted access rights to connect to the South West REZ.
This was quickly followed by an announcement earlier this month that 7.15GW of renewable energy and energy storage projects had been granted access rights to connect to the Central-West Orana REZ, which is set to become the country’s first zone to enter construction later this year.
Chloe Hicks, executive director of strategy and policy at EnergyCo, hopes that the tender process successes for the South West and Central-West Orana REZ in New South Wales will help attract foreign investment in the state’s energy storage market.
“We really hope to see more international investment come in and they can see the opportunities for energy storage in New South Wales,” Hicks exclusively tells ESN Premium.
For Hicks, the tender process for both of these REZs aimed to attract high-quality renewable energy and energy storage projects to New South Wales that could contribute to the state’s target to secure at least 12GW of renewable energy generation and 2GW of long-duration energy storage (LDES) by 2030.
“We ran a rigorous and robust application process that identified the applicants with the greatest chance of success, and that included looking at things like their proven track record for community engagement and delivering strong benefits to communities,” Hicks says.
“We also conducted significant due diligence to ensure we progress the highest quality projects. That included technical, commercial, and legal, as is typical for these processes.”
Five organisations were successful in their applications for the South West REZ. These include Origin Energy, Spark Renewables, Someva Pty, AGL Energy, and BayWa r.e.
For the Central-West Orana REZ, Acen Australia, Lightsource bp, Pacific Partnerships and Potentia Energy were all granted access rights.
Hicks notes that although EnergyCo did not specifically seek energy storage projects, being technology agnostic, the applicants themselves looked to include energy storage to optimise their projects.
“We absolutely encourage and look at how we can support storage as part of that mix,” Hicks begins.
“The tender and application criteria did not have a technology preference, so that [BESS] was more something that came through as a result of market developments and what the generators saw as the best way to deliver commercial projects.”
Co-located energy storage projects are increasingly becoming more frequent in Australia, especially in the National Electricity Market (NEM), which spans Australia’s eastern and southern coast, alongside the island state of Tasmania. These typically fall into solar-plus-storage and wind-plus-storage.
For Hicks, the co-location of variable renewable energy generation and energy storage represents the “lowest form of electricity to replace coal-fired power stations.”
Attracting international investment
Although Australia and New South Wales’ energy storage industries continue to grow, with UK-headquartered energy industry platform Modo Energy expecting 16.8GW of utility-scale BESS to come online in the NEM by 2027, attracting investment, both internationally and domestically, will be paramount.
As Hicks previously said, the opportunities in New South Wales could be crucial in attracting international investment, especially given the current political uncertainty in the US and how that has impacted investment in BESS.
The REZs will be central to attracting this investment. Hicks believes that these zones offer several benefits that could make them more attractive for investors and increasing confidence in the New South Wales energy storage market.
“We want to make renewable energy projects more reliable to investors. Our Central-West Orana REZ access scheme makes it faster and simpler for projects to connect to the grid by linking them through a shared hub,” Hicks tells ESN Premium.
“This approach gives them more certainty, reduces cost delays, and helps manage system strength more effectively than standard connection processes under AEMO’s National Electricity rules. We’d really encourage prospective developers to look at opportunities inside REZs and work closely with EnergyCo so we can understand their evolving business needs.”
Hicks also believes that the state’s “proven track record” in attracting and delivering support for large-scale BESS could serve as a reference from prospective developers, highlighting the successes of one of the state’s largest standalone BESS assets: the 1,680MWh Waratah Super Battery.
Bushfire risks in Central-West Orana
One key topic often associated with BESS is the flammability risks. This extends from utility-scale energy storage systems to home BESS.
NSW became the first Australian state to propose regulations for batteries under the Product Lifecycle Responsibility Act earlier this year, including safety considerations.
Regardless, developing BESS in Australia’s regional areas often means managing bushfire risks. This has become a hotly debated issue following the 16 January fire at Moss Landing Energy Storage Facility in Monterey County, California, which outside observers dubbed a ‘wake-up call’.
There are also synergies between the Californian fire and Australia, with several experts blaming eucalyptus trees, which had been imported and introduced to the US from Australia in the 1850s, for exacerbating the wildfire due to their highly flammable properties.
The Central-West Orana region has a significant presence of eucalyptus trees, contributing to the area’s ecosystem. According to EnergyCo, this means that areas of the designated REZ are in “high-risk” bushfire areas.
EnergyCo has employed a stringent process to mitigate the risk of bushfires impacting energy assets. Hicks notes that bushfires are a “very serious thing” when it comes to energy assets in regional parts of New South Wales.
“Looking at the projects, we consider the history of bushfires, density and type of vegetation, topography, access constraints and other factors that may affect bush fire risk when planning the transmission route. We also consider how bushfires may behave when we design transmission lines and related infrastructure,” Hicks says.
Hicks also notes that although EnergyCo takes bushfires in consideration, this is often resolved in the planning process, which requires projects to satisfy how hazards and risks are managed.
Attracting additional investment in New South Wales’ energy storage market will be essential for the state and Australia to meet their decarbonisation targets. The REZs will likely play a crucial role in facilitating this, whilst also enhancing the appeal of the Australian market to an international audience.
Our publisher, Solar Media, will host the Battery Asset Management Summit Australia 2025 on 26-27 August in Sydney. Tickets can be purchased here.
