Energetics has been tracking the market for renewable contracting in the National Electricity Market (NEM) since 2017. After a subdued 2019, the market rebounded strongly and has set multiple records since 2020. As of March 2025, the volume of energy contracted for annual delivery through renewable Power Purchase Agreements (PPAs) with end users since 2017 is estimated at 26.2TWh.
2024 features record volumes, but fewer deals
The renewable PPA market in the NEM continued to set new records in 2024, with a spate of deals pushing the total announced agreements to ~8TWh. Notable transactions from 2024 include:
- Rio Tinto, which set the record for the largest PPAs signed by end users in the NEM at ~2.6TWh each.
- BM Alliance Coal, a joint venture between BHP and Mitsui & C.O, announced an ~780 GWh p.a. deal which will come into effect in FY2027.
- the largest multi-state retailer-intermediated PPA transaction in the NEM so far, the third stage of the QIC & IFM buyers group initiative at 311GWh p.a.
Demand remained strong throughout the rest of the year, with a further ~1.2TWh p.a. of transactions facilitated by Energetics, that are concluded, but yet to be announced, or already in the market. This excludes the landmark Tomago Aluminium transaction facilitated by Energetics which may well challenge the recent benchmark set by Rio Tinto.
Whilst 2024 has been driven to record highs through resources and heavy industry players, the number of deals relative to 2022-2023 has fallen, reflecting the tightness in the supply of corporate offtake opportunities. New project developments in both Victoria and New South Wales are facing challenges for a multitude of reasons such as the upcoming access rights tenders for Renewable Energy Zones (REZs), which are also facing delays. In contrast, projects in Queensland are proceeding faster, reflected in the state's dominant, ~80%, share of corporate PPAs so far in 2024 (although this figure is largely skewed by the two Rio Tinto agreements).
See our interactive tracker below for an overview of PPAs of 10GWh p.a. or more announced in the NEM since 2017. The view can be segmented by deals, states, technology type and industry.
Between 2017 and 2023, retailer intermediated PPAs and financial PPAs accounted for an even share of the end-user contracted renewable electricity volume as measured in GWh p.a. In recent years, retailers, acting as aggregators, have become a more attractive option as they have the ability to better support corporates with smaller electricity loads to reduce market risks. However, the several large financial PPAs announced so far in 2024, have skewed this ratio somewhat.
Since 2017, we have also seen wind being the favoured technology type (53% of contracted volume) over solar (39% of contracted volume). The residual is a mix of technologies.
What can we expect for the coming years?
As a rule of thumb, organisations with 2025 renewable energy targets are typically less energy intensive (i.e. built environment). Most would have contracted by now and those with 2025 targets that have not will be faced with a very tight near-term supply demand balance and high PPA prices.
Developers and retailers can therefore expect demand for later dated PPAs to increase as buyers seek to secure supply from 2027 onwards to safely meet 2030 targets; and tenures to extend well beyond 2030. Companies with 2030 targets include some major ITC, industrial and resources players, as well as the healthcare sector which is noticeably absent from the PPA market at present.
These loads can be significant as illustrated by the recently announced Rio Tinto PPAs and Tomago smelters recently announced tender process. Noting that Tomago consumes ~8TWh p.a. ,accounting for ~12% of the total NSW electricity load.
The good news for organisations with 2030 targets is that the tightness in the supply demand balance over the 2028 to 2030 horizon is expected to ease with Renewable Energy Zones expected to be connected.
Energetics is a market leader in corporate PPAs
Energetics played a leading role during the formative days of the renewable PPA market, providing commercial and technical advice on landmark deals such as Sydney Desalination Plant (2009), as well as the MREP1.0, Sydney Metro and Monash University (a member of the Telstra Club) in 2017.
We've advised Woolworths Group’ on their NSW transaction the third PPA for the Group, covering 100% of their NSW and ACT operations for 8 years. The retailer intermediated PPA, with SmartestEnergy, incorporates an innovative, structured renewable solution, backed by an offtake from Octopus Investments’ Darlington Point Solar Farm and Woolworths’ existing PPA with Squadron Energy’s Bango Wind Farm. Energetics also supported Equinix, in securing the PPA with Golden Plains Wind Farm which is expected to represent the last 4% required by Equinix to achieve a global 100% renewable target based on current consumption.
Other Energetics’ clients who’ve announced PPAs, often across multiple jurisdictions, include ALDI Stores, Brisbane Airport, Charter Hall, City of Adelaide, CSIRO, Dexus, Fujitsu, ISPT, nbn, Transurban, Woolworths and Newcrest Mining. We’ve also advised on several buyers’ groups such as MREP 1.0 and 2.0, the 52-member Victorian Energy Collaboration (VECO), as well as individual members of other buyers’ groups (i.e. IFM /QIC Buyers Group and the Lion / Australia Hotel Association Buyers Group).
We offer strategic and commercial transaction advice – from business case development to market engagement, evaluation, deal negotiation and, where required, AFSL intermediation. We also provide post-deal implementation and validation services.
Footnotes
[1] Genex to supply 337.5MW of solar power to Fortescue (power-technology.com)
[2] ACCIONA Energy Inks PPA with Stanwell Corporation for Aldoga Solar Farm (blackridgeresearch.com)
[3] The rate of improvement in the technology’s performance and cost as more renewable energy units are produced and deployed.
[4] This transaction has now been removed from our PPA Tracker.
