Insight,

Queensland: A Renewable Energy Superpower

AU | EN
Current site :    AU   |   EN
Australia
China
China Hong Kong SAR
Japan
Singapore
United States
Global

On 28 September 2022, the Queensland Government released the ‘Queensland Energy and Jobs Plan’ (Energy Plan). The $62 billion Energy Plan aims to evolve Queensland into a renewables, hydrogen and clean energy superpower.

It increases the government’s Renewable Energy Target to 70% by 2032 and 80% by 2035 (up from its previous target of 50% renewable energy by 2030) and includes a commitment to stop regular reliance on coal fired generation by 2035.

Investment in up to 7 GW of pumped hydro, and major transmission enhancements to unlock 22 GW of renewables, underpin the plan.

Key Features of the Energy Plan

Below is an overview of the key features of the Energy Plan:

  • (SuperGrid) the term used by the government to refer to Queensland’s modern electricity system which includes, the Pumped Hydro Energy Storage (PHES) assets, new transmission networks, more batteries, low to zero emission gas and more renewables in the Queensland Renewable Energy Zones (QREZ). The government estimates that the SuperGrid will create 8 times more renewable energy than in 2022. Figure 1 below shows the shape of the 2035 SuperGrid.
  • (Pumped Hydro Stations) the development of two new pumped Hydro Stations in Pioneer Burdekin (roughly 70Km west of Mackay), and Borumba Dam (near Imbil on the Sunshine Coast) by 2035. The Government estimates that these pumped hydro stations could deliver up to 7 GW of long duration storage for Queensland. The Premier has dubbed the Pioneer Burdekin station as the ‘The Battery of the North’, with a potential to be the largest PHES in the world with roughly 2.5 times the generation capacity of Snowy Hydro 2.0. A new government owned entity ‘Queensland Hydro’ will be established to develop the pumped hydro stations.
  • (Clean energy hubs / the end of coal fired generation in Queensland) a commitment to all publicly owned coal-fired power stations operating as clean energy hubs by 2035. The Energy Plan contemplates a gradual phase out of coal-fired power plants with the Government reserving capacity to cover periods where renewable energy cannot meet the energy demand. Figure 2 below shows the rapid change in the Queensland energy mix between now and 2035.
  • (Job Security Guarantee) a $150 million job security guarantee and an Energy Workers’ Charter will be implemented to support workers in publicly owned coal-fired power stations by assisting them in transitioning into future energy sectors or by providing alternative employment opportunities in the clean energy hubs.
  • (Energy System Advisory Board) a new oversight board will be established to advise the Government on the energy transformation and provide progress updates on the SuperGrid every 2 years from 2025. Legislation will be prepared to establish and mandate the operation of the Energy System Advisory Board.
  • (Hydrogen) the Government remains committed to hydrogen and will invest in a new 200MW hydrogen-ready gas peaking power station at Kogan Creek. The Government will also invest up to $20 million to update the Queensland Hydrogen Industry Strategy and to investigate further plans for renewable hydrogen hubs across Queensland.
  • (QREZ) the Government estimates that 25 GW of renewable energy is required to meet its 2035 energy targets. The Energy Plan sets out a plan for the connection of an additional 22 GW of wind and solar into QREZ by 2035. A new legislative framework which will enable Powerlink to develop ‘declared REZ’ (small targeted areas that are most prospective for renewable development) with coordinated transmission infrastructure is intended to be legislated in 2023.
  • (Funding) from 2022 the Energy Plan will involve $62 billion of investment including:
    • $2.5 billion boost to the Queensland Renewable Energy and Hydrogen Jobs Fund (with $500 million going towards government-backed grid-scale and community batteries);
    • $285 million to begin building the ‘SuperGrid’;
    • over $270 million to progress the two pumped hydro stations;
    • $200 million to the Regional Economic Futures Fund;
    • $150 million to the Job Security Guarantee and $90 million for two new training hubs;
    • Powerlink will invest $365 million for the Gladstone Grid Reinforcement; and
    • $42 million in relation to electric vehicles and updating public charging infrastructure.

Delivery and Financing Opportunities

The Energy Plan provides a significant pipeline of work for government, government owned corporations and the private sector, to be delivered at the same time as NSW and Victoria seek to ramp up their own renewable transformation and while Queensland prepares to host the 2032 Olympics.

Initial indications are that:

  • government will continue to own the majority of generation in the system, including the two new large-scale, long-duration pumped hydros and the clean energy hubs at the existing coal fired power station sites;
  • transmission will receive a kick-start from government and Powerlink funding and will otherwise be funded through the QREZ framework; and
  • private developers and investors will have a significant role in developing smaller hydro and battery projects, low or zero emissions gas fired generation and in the continued deployment of grid scale solar and wind, including projects connected to QREZ and those developed in collaboration with government owned corporations.

We also expect there to be opportunities for financial investors to deploy creative funding solutions to support the plan.      

What’s Next?

The Queensland Government will be consulting on key initiatives in the Energy Plan during 2023, and will revisit or release a number of additional plans. It is currently developing an Energy Storage Strategy (anticipated release in 2024) and a new Queensland Battery Industry Strategy.

Otherwise, QREZ legislation is expected in 2023, planning for the new pumped hydros is already under way and Queensland’s government owned corporations continue at pace in planning transmission and rolling out renewable energy developments.


 

Figure 2 - Queensland's Target Energy Mix

Source: https://media.epw.qld.gov.au/files/Queensland_Energy_and_Jobs_Plan.pdf

.

LATEST THINKING
Insight
Australia’s new wage theft criminal offence is now in operation, having formally commenced on 1 January 2025.

13 February 2025

Insight
As the private markets have grown, and regulation becomes a more often used tool for managing market risks, discussion has, inevitably, turned to whether private capital is adequately regulated.

11 February 2025

Insight
The Government has tabled a report on the review of the Online Safety Act 2021 (Online Safety Act or OSA).

10 February 2025