{"id":6443,"date":"2024-02-28T01:19:42","date_gmt":"2024-02-28T01:19:42","guid":{"rendered":"https:\/\/economicherald.net\/?p=6443"},"modified":"2024-02-28T01:19:42","modified_gmt":"2024-02-28T01:19:42","slug":"frontier-energy-set-to-vault-into-top-echelon-of-renewable-energy-producers-in-wa-with-waroona-project","status":"publish","type":"post","link":"https:\/\/economicherald.net\/?p=6443","title":{"rendered":"Frontier Energy set to vault into top echelon of renewable energy producers in WA with Waroona project"},"content":{"rendered":"<p>Frontier Energy delivers robust DFS for Waroona solar and battery project<br \/>\nHeadline numbers include EBITDA of $68m per annum over the first five years and post-tax IRR of 26.1%<br \/>\nPayback time is less than six years, representing 19% of the total 30-year project life<br \/>\nFinancial advisers secured, with a final investment decision pegged for the mid-2024<\/p>\n<p>\u00a0<\/p>\n<p><strong><em>Special Report: <\/em><\/strong><strong>A definitive feasibility study (DFS) for developing the Waroona solar and battery project looks to propel Frontier Energy into becoming a significant renewable energy provider in WA, with a Stage 1 goal of producing 258GWh of solar energy.<\/strong><\/p>\n<p><a href=\"https:\/\/stockhead.com.au\/company\/frontier-energy-fhe\/\"><strong>Frontier Energy (ASX:FHE)<\/strong><\/a> says the study confirms Waroona as a long-life, low operating cost and highly profitable renewable energy outfit, comprised of a 120MWdc (megawatts of direct current) solar facility with an integrated four-hour 80MW battery.<\/p>\n<p>The company <a href=\"https:\/\/stockhead.com.au\/energy\/debt-advisors-appointed-as-frontier-energy-looks-to-advance-development-of-its-waroona-renewable-energy-project\/\"><strong>recently appointed Leeuwin Capital Partners as debt advisors<\/strong><\/a>, noting the group\u2019s esteemed track record of creating secure revenue streams for businesses in the West Australian energy sector \u2013 a key milestone on the way to a final investment decision for the Waroona project.<\/p>\n<p>\u00a0<\/p>\n<p>The Waroona renewable energy project footprint. Pic: Supplied (FHE)<\/p>\n<p>\u00a0<\/p>\n<h2><strong>Demand to outpace supply<\/strong><\/h2>\n<p>FHE chief executive Adam Kiley says the Stage 1 DFS delivers an excellent result and highlights the company\u2019s \u201cfantastic and unique\u201d opportunity to become a near-term major renewable energy producer in WA.<\/p>\n<p>\u201cThis comes at a time when energy demand continues to outpace supply in WA, resulting in electricity prices reaching record highs,\u201d he says.<\/p>\n<p>\u201cJust last week, record peak demand on the South West Interconnected System (SWIS) was surpassed once again, with the top six operational demand peaks ever recorded in the State\u2019s main grid all happening between January 31 and Feb 19 this year.<\/p>\n<p>\u201cUnfortunately, the majority of the energy to meet this record demand peak came from carbon-emitting sources, with 58% being gas and 32% being coal-generated.<\/p>\n<p>\u201cThis highlights the urgent requirement for renewable energy storage solutions, such as our 100% renewable energy Waroona solar\/battery project, to quickly come online.\u201d<\/p>\n<p><strong>\u00a0<\/strong><\/p>\n<h2><strong>DFS highlights<\/strong><\/h2>\n<p>The key numbers are as follows:<\/p>\n<p>EBITDA of $68 million over first five years<br \/>\n$304 million total initial capital cost<br \/>\n5.8 years post-tax payback<br \/>\nPost-tax IRR of 21.6%<br \/>\nFirst-year solar generation of 258GWh with 119GWh discharged\/sold into WA market<\/p>\n<p>The study\u2019s metrics include an average energy price forecast over the life of the operation at $143\/MWh4 (peak periods) and $80MWh4 (solar price), in line with 2023\u2019s actual prices on WA\u2019s Wholesale Energy Market (WEM).<\/p>\n<p>\u201cHighlights of the study include exceptionally strong financial returns under all key metrics, including forecast EBITDA averaging $68m per annum over the first five years of production,\u201d Kiley says.<\/p>\n<p>\u201cThese strong returns drive a rapid post tax payback of 5.8 years, or 19% of the project life of 30 years.<\/p>\n<p>\u201cA major contributor to this is the Reserve Capacity Payment, a feature unique to WA, which is forecast to provide revenue of about $28m per annum during the first five years of production.\u201d<\/p>\n<p>FHE aims to move rapidly towards FID by the middle of this year.<\/p>\n<p>Barrenjoey has been appointed to assess strategic development partnerships with a range of firms which have expressed interest in the project.<\/p>\n<p>\u00a0<\/p>\n\n<p><span class=\"mce_SELRES_start\">\ufeff<\/span>\u00a0<\/p>\n<p><em>This article was developed in collaboration with Frontier Energy, a Stockhead advertiser at the time of publishing.<\/em><\/p>\n<p>\u00a0<\/p>\n<p><em>This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.<\/em><\/p>\n<p><span class=\"et_bloom_bottom_trigger\"><\/span><\/p>\n<p>The post <a href=\"https:\/\/stockhead.com.au\/energy\/frontier-energy-set-to-vault-into-top-echelon-of-renewable-energy-producers-in-wa-with-waroona-project\/\">Frontier Energy set to vault into top echelon of renewable energy producers in WA with Waroona project<\/a> appeared first on <a href=\"https:\/\/stockhead.com.au\/\">Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"<p>Frontier Energy delivers robust DFS for Waroona solar and battery project Headline numbers include EBITDA of $68m per annum over the first five years and <a href=\"https:\/\/economicherald.net\/?p=6443\" class=\"read-more-link\">[more&#8230;]<\/a><\/p>\n","protected":false},"author":0,"featured_media":6444,"comment_status":"","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-6443","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - 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