Case Study: Connecting the Southern Downs Renewable Energy Zone to the National Electricity Market

Key issues

We advised CEFC on its $160 million financing commitment to Powerlink, which will be used to support the Southern Downs Renewable Energy Zone (REZ). Our work extended to advising on upsizing transmission and grid infrastructure required to connect the MacIntyre Wind Farm and the 103MW Karara Wind Farm in Queensland to the NEM.

The transaction is the first time generator contributions will cover the cost of building critical REZ assets. This will allow the project to develop at scale, keeping connection costs down for the initial generators.

Our solution

We implemented a concessional financing structure for the $160 million financing commitment. This cost-effective solution ensured a scale efficient build out shared across future generation capacity.

We negotiated and drafted the finance documents to ensure that CEFC’s commitment ranked pari passu to the other creditor (Queensland Treasury Corporation who committed approximately $7 billion).

_Disclaimer

_{Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.}