NSW’s $1 billion clean energy fund selects first investment projects

The state government’s $1 billion renewables fund has chosen its first project, investing $100 million in battery projects in Newcastle and Homebush.

The Energy Security Corporation (ESC) was created to fill the gap where the private sector was reluctant to invest in renewables projects. The fund offers investments between $25 million and $150 million, prioritising short- and long-term energy storage projects to capture excess solar and wind power.

The first investment comes almost a year after the appointment of the board, and two years after the government introduced legislation to create the agency.

Construction on the first battery at the Steel River Industrial Estate in Newcastle will begin work next month, with another in Homebush to follow. Ausgrid Group entity PLUS Grid Storage is delivering the projects, with two more still in the planning stage.

A government spokeswoman said all four batteries combined will have the capacity to power up to 118,000 homes a day. The first 500 megawatts of storage is expected to be available by 2029.

The $100 million from government will contribute to an estimated $800 million total investment, with the remainder of funds coming from private capital.

The Herald previously reported criticism from the Greens that the government had not acted fast enough to set up the ESC to invest in projects. Energy Minister Penny Sharpe said the delay was due to negotiations with projects, which needed to line up private partners.

In a September 2025 media release titled “The need for speed in energy infrastructure investment”, chief executive Paul Peters said the corporation’s role was “to say yes where others hesitate”.

“There is much to do and we’re working with urgency because the challenge is not just building a new system, it’s doing so at speed and scale while maintaining reliability,” Peters said.

Sharpe said large-scale battery storage projects would help put downward pressure on energy prices.

The investment will specifically aim to ensure energy security in the Sydney, Newcastle and Hunter regions as coal-fired power stations are retired. Eraring, in Lake Macquarie, Australia’s largest coal-fired power station, was due to shut down in August 2027. That was extended to 2029 after the Australian Energy Market Operator warned the grid wasn’t prepared.

Premier Chris Minns told 2GB last year that keeping Eraring online for longer was a “no-brainer” and a good thing for the state.

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