$3 billion to rewire Western Australia

The federal and Western Australian governments have signed a landmark agreement to expand and modernise electricity grids in Perth, the South West and the North West Pilbara region.

The Commonwealth-Western Australia Rewiring the Nation deal will bolster WA’s energy security in preparation for increasing use of renewable energy and battery storage.

It will be backed by up to $3 billion through concessional loans and equity investments to WA through the Clean Energy Finance Corporation (CEFC) to new builds and major upgrades to transmission in the state’s South West Interconnected System (SWIS) and the North West Interconnected System (NWIS).

Priority projects in these grids were identified through WA’s demand assessment processes, with recent Australian Energy Market Operator modelling supporting the need for sustained investment in transmission infrastructure in the SWIS, according to a statement.

Federal Climate Change and Energy Minister Chris Bowen said the agreement would drive cheaper, more reliable energy in WA and setting the state up for years to come.

Bowen said: “Renewable energy is the cheapest form of energy and the Rewiring the Nation deal will put downward pressure on electricity bills for WA consumers in the years ahead.

“The Australian and Western Australian Governments are enabling WA to capitalise on the renewable energy transformation and make the most of the incredible jobs opportunity that comes with it.”

This deal will finance priority projects across WA’s main electricity network, the SWIS to increase the supply of renewable energy, and connect it into the grid by plugging in renewable generation hubs.

Initial modelling suggests that in 20 years’ time, the SWIS grid serving Perth and the south-west will need to have up to five times more electricity than is available today, as new industrial users connect to the grid.

The Pilbara’s NWIS consists of largely standalone networks owned by private companies and public entities, with only a very small proportion (less than two per cent) of electricity generated from renewables.

The agreement will support more renewable energy in the NWIS, while ensuring existing infrastructure upgrades are coordinated between industries and Governments.

Western Australian Minister for Energy Bill Johnston said the agreement has been informed by WA Government modelling, specifically from the South West Interconnected System Demand Assessment and the Pilbara Industry Roundtable process.

Johnston said: “It is expected the private sector will largely fund the cost of renewable energy generation and transmission infrastructure in the Pilbara, to the tune of tens of billions of dollars over the coming decades.

“The low-cost finance program will help unlock this significant investment.

“Keeping Western Power in public hands has allowed the State Government to support this significant program of works by funding transmission infrastructure in the SWIS – where we have already funded $126 million in the recent Budget to kickstart early network planning.”

Picture: Clean Energy Finance Corporation