Long-term energy service agreements (LTESA) NSW

AEMO Services is an independent commercial subsidiary of the Australian Energy Market Operator (AEMO). It has been appointed by the NSW Government to run competitive tenders for Long-Term Energy Service Agreements (LTESAs) and Renewable Energy Zone (REZ) Access Rights. They aim to support investment, construction and operation of renewable energy generation and long duration storage infrastructure in NSW.

AEMO Services announced that 4 October (2022) is the target open date for the inaugural tender round for new generation and long duration storage. It is part of the NSW Electricity Infrastructure Roadmap.

The roadmap is a policy framework that coordinates investment for generation and storage infrastructure across the NSW electricity network. It has the long-term aim of cheaper and more reliable energy for NSW consumers.

The roadmap is the plan to implement the Electricity Infrastructure Investment Act 2020 (EII Act). It was enactedwith cross-party support in December 2020. The roadmap coordinates investment in transmission, generation, storage and firming infrastructure as ageing coal-fired generation plants retire. The roadmap includes actions that will work together to deliver ‘whole-of system’ benefits. The EII Act sets a target to construct 2 GW of long duration storage capacity by the end of 2029. The Q4 2022 tender has an indicative tender size for LDS LTESAs of 600MW.

Since the Roadmap was enacted, more than 3.6 GW of energy investment has been committed or anticipated across NSW. All of these projects are expected to be eligible to participate.

AEMO Services has published a draft tender pack to help potential tenderers to be prepared for the release of the October tender. These are available on line.

The tender process had been designed to encourage high levels of participation in the LTESA program. This aims to ensure that the roadmap’s infrastructure objectives would be met.

The October tender release is the start of a 10-year tender plan. It marks a change to the way electricity investment is delivered in NSW and Australia.

We have wide experience and success in energy sector tenders.