A financial close has been reached by Tilt Renewables Ltd (NZX & ASX: TLT) for development of the 336 MW Dundonnell wind farm in western Victoria.
Tilt chairman Bruce Harker said the board made the final investment decision on October 30 and “it is a credit to the team to have reached this milestone quickly.”
Construction will begin early in 2019, with final completion late in 2020.
Tilt Renewables partnered with Vestas for supply of turbines and construction of the project under a full Engineer, Procure and Construct (EPC) contract and with AusNet Services for the transmission connection component to be delivered via a build, own and operate model.
“These partners are competent and experienced market participants with whom we have worked successfully on other projects and we are confident they will deliver the expected outcomes for this hugely important project” said Tilt chief executive Deion Campbell.
This project will increase by more than 50% the asset base owned and operated by Tilt, a major step towards achieving the company’s strategic goal of more than doubling the assets under its management.
Around 87% of the production from the wind farm has been contracted to both the Victorian State Government, following a support agreement under the Victorian Renewable Energy Auction Scheme, and Snowy Hydro under an offtake agreement.
“The support agreement from the Victorian State Government provided sufficient revenue certainty for the project to proceed to investment decision, and also for Snowy Hydro to be confident the project would proceed, Campbell said.
“The addition of a second offtake for 50% of the project with such an experienced and high-quality industry participant as Snowy Hydro adds to our excitement” he added.
Dundonnell is expected to cost $A560 million ($NZ594.75 M) and will be funded by a mix of debt and equity, with the equity raising for the project likely to occur early in 2019.