Genex Power Limited has received a conditional offer for grant funding totalling up to $47 million from the Australian Renewable Energy Agency (ARENA) for the Kidston Pumped Storage Hydro Project (K2-Hydro).
In addition to the $47 million grant, ARENA has agreed to convert the repayment of the $9M in development funding previously provided for the into a non-recoupable grant.
The $47 million, is in the form of a non-recoupable grant, which is payable to the special purpose vehicle established for purposes of owning, constructing and operating the Project (Project SPV) and to the EPC Contractor appointed to construct the Project. The ARENA Project Grant will be put towards the capital construction costs of the project, alongside the debt facility of up to $610 million from the Northern Australia Infrastructure Facility (NAIF).
“Genex is delighted to continue the strong partnership it has formed with ARENA on the Kidston Pumped Storage Hydro Project since its inception in 2015. Genex’s relationship with ARENA has covered the early feasibility study works, subsequent project structuring and development activities, and now the implementation and construction of the iconic Kidston Pumped Storage Hydro Project. Throughout this period, ARENA has continued to provide support and guidance to facilitate the development and financing of the K2-Hydro Project, as the first in a series of potential private sector pumped hydro developments which will play a crucial role in balancing the increasing penetration of renewable energy into the electricity grid,” commented Genex CEO James Harding. “The $47 million Project Grant is a critical funding source for the project financing which, in combination with the conversion of the existing $9M ARENA Development Funding into a non-recoupable grant, will enable the project to proceed to financial close and commencement of construction in the coming period.
“On behalf of Genex, I would like to thank ARENA for the ongoing support it has provided to the Company. ARENA’s support includes the $8.9M in funding towards Genex’s 50MW Kidston Solar Project in 2016 as well as the funding to support the development and construction of the Company’s flagship Kidston Pumped Storage Hydro Project. The development of the Kidston Pumped Storage Hydro Project at the Kidston Clean Energy Hub in Queensland will create over 500 direct jobs during construction and support remote and regional businesses and communities in a time of difficult economic global and national circumstances.”
Wises Pit, Kidston Clean Energy Hub