Australia’s CIS Tender 1 delivers significant boost for renewable energy sector

Joni Henry, renewable energy and corporate law expert at Pinsent Masons, said: “The Scheme’s long-term underwriting of revenue for renewable projects supports the continued investment in Australia’s renewable energy sector and the growth of clean, affordable and reliable power generation for all Australians.” 

CIS Tender 1 attracted a mix of local and international renewable energy developers. The 19 successful projects are set to deliver 6.4 gigawatts (GW) of renewable energy into the national electricity market (NEM) – enough to power an estimated three million households.

The projects include a diverse range of renewable technology, including solar, wind and ‘hybrid’ projects - solar or wind projects supported by battery energy storage systems (BESS). New South Wales (NSW) and Victoria have emerged as the primary beneficiaries of this first tender. NSW secured 3.7 GW of renewable capacity along with 904 megawatt hours (MWh) of battery storage, while Victoria received 1.6 GW of capacity and 1,458 MWh of storage. South Australia and Queensland also saw significant allocations, with projects generating 574 megawatts (MW) and 550 MW respectively, complemented by substantial battery storage.

Tender 1 received 84 bids at the first stage, with the total capacity of the bids equal to 27 GW – or approximately 4.5 times the tender capacity – with 52 bids then invited to submit financial value bids in the second stage. The final successful 19 projects will now negotiate a CIS arrangement with the government, which will provide revenue underwriting for up to 15 years. These projects are expected not only to contribute to reducing carbon emissions, but also to enhance energy reliability and affordability for Australian households and businesses.

Tim Dorgan, a corporate law expert at Pinsent Masons who specialises in the development of energy projects, said: “The volume of bids and uptake of CIS agreements shows that the potential revenue certainty provided by the scheme resonates with the sector, at a time when other inputs are challenging the financial model for many projects.”

Three additional CIS tenders are either in progress or about to open. CIS Tender 2 projects are set to be announced shortly, with 16 bids submitted to provide an indicative capacity target of 2GWh dispatchable power in Western Australia’s Wholesale Electricity Market.

Registrations for CIS Tender 3 (NEM Dispatchable) closed on 11 December with bids due on 18 September and CIS Tender 4 - NEM Generation with a target capacity of 6GW - opened on 13 December, with registrations closing on 11 February 2025 and bids to be submitted by 18 February 2025.