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Government Power Supply Contract to Boost Competition and Support Jobs

SIMEC ZEN Energy is proud to reproduce the following important media release from Hon Jay Weatherill MP, Premier of South Australia, and Hom Tom Koutsantonis MP, South Australian Minister for Mineral Resources and Energy.
This media release was originally published on the 17th of December 2017, and marks an important stage in the growth and future of SIMEC ZEN Energy and a step change in the contracting and use of energy across Australia.

 

SIMEC ZEN Energy, a new South Australian electricity retailer, will supply the State Government’s power needs until construction of the solar thermal plant at Port Augusta is complete.

Under the contract, SIMEC ZEN Energy will supply more than 80 per cent of the Government’s electricity needs in 2018. This will escalate to 100 per cent in 2019 when it will be backed by local renewable energy projects.

The State Government will be SIMEC ZEN Energy’s first electricity customer. This is expected to help SIMEC ZEN Energy attract other customers, bringing much needed competition to the retail electricity market and putting further downward pressure on prices.

The contract with SIMEC ZEN Energy offers competitive prices, and a commitment to working with the State Government to identify opportunities to save energy and reduce power costs. Some of these opportunities will lead to improved demand management practices across Government sites, further improving the reliability of the grid by reducing system load during periods of high demand.

In addition, SIMEC ZEN Energy will also provide the State Government with ongoing retail services for five years from 1 November 2020, during which time the whole of the State Government’s load will be supplied by the Aurora solar thermal plant at Port Augusta.

Background

In August the State Government announced that SolarReserve had had won a competitive bid process to supply all of the Government’s power needs, with the project set to boost market competition and put downward pressure on power prices.

The 150MW Aurora solar thermal power plant at Port Augusta will be the biggest of its kind in the world and create 650 local jobs during construction and 50 ongoing positions.

Construction of the $650 million facility will begin in 2018 and is estimated to be completed in 2020.

As current electricity supply arrangements expire on 31 December 2017, the State needed to secure “bridging” electricity supply arrangements from 1 January 2018 until 31 October 2020. It also needed to secure retail services from 1 November 2020 to align with the SolarReserve contract.

“It’s fantastic that we were able to secure the electricity to supply our hospitals, schools and electrified rail for the next few years while supporting the growth of a new retail business that will bring some much-needed additional competition into the energy market.

Earlier this year, we used our power supply requirements to underwrite the entry of the Port Augusta solar thermal plant to the market, which will put downward pressure on power prices for all South Australians, but also create hundreds of jobs for locals in the Upper Spencer Gulf.

Now, we have been able to use this bridging contract to support the entry of home-grown renewable energy company SIMEC ZEN Energy into the retail market, which will support high skilled local jobs.”

Hon. Jay Weatherill MP, Premier of South Australia

 

“SIMEC ZEN Energy is a great local success story. Through their partnership with GFG Alliance, they are set to become a major national player in the supply of renewable energy firmed by storage, providing large energy users with power at better prices than we have been seeing from the established providers.

This contract will help underpin SIMEC ZEN Energy’s investment in South Australia and add new competition to the retail market, putting downward pressure on power prices that will benefit all South Australians.”

Hon. Tom Koutsantonis MP, Minister for Mineral Resources and Energy

 

“This is the first major contract that SIMEC ZEN Energy has concluded since GFG’s investment in the company. I am very pleased that this milestone is in partnership with the South Australian Government. Working hand in hand with governments to deliver solutions to real problems in the market place has long been the hallmark of GFG Alliance.

This is the beginning of a journey that will see SIMEC ZEN Energy redefine the energy landscape of Australia, bringing down costs dramatically and making globally competitive energy a key advantage for Australian industry.

Australia deserves a competitive energy industry. This will drive jobs and growth, it will encourage the private sector to invest and entrepreneurs to take more risk, not only in South Australia but across the country.”

Sanjeev Gupta, Chairman of SIMEC ZEN Energy and GFG Alliance

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