Infigen buys first gas plant to support more cheap renewables

Infigen Energy has taken steps to bolster its portfolio of “cheap renewables” with the purchase of a 109MW “peaking” gas plant in NSW.

Infigen said on Thursday it had purchased the Smithfield peaking gas plant for $60 million, driven by a significant market opportunity for cheap renewables.

Infigen said the cost of renewables generation had decreased to $45-55/MWh, and put the cost of firming at around $9-12/MWh, making the cost of “firm renewables” somewhere between $54/MWh and $67/MWh.

On top of the $60 million for the open cycle gas turbine, Infigen will also pay $1 million for every extra megawatt of capacity it can get out of the plan, subject to discussions with AEMO (up to a maximum 1234MW and $74 million total price).

Infigen says the gas plant allows it to increase its long-term contracted position to approximately 75 per cent of generation.
Currently its portfolio stands at around 700MW of almost exclusively wind farm assets, but it expects this to jump to more than 1,000MW with the opportunities presented by the new purchase.
Giles Parkinson