Wednesday 22nd Nov, 2017

$700m deal plan to power Whyalla Steelworks

The Whyalla steelworks is one of two operating steelworks in the country. Photo: Hema Maps / Jim Wilson
The Whyalla steelworks is one of two operating steelworks in the country. Photo: Hema Maps / Jim Wilson

New Whyalla steelworks owner Sanjeev Gupta has directed a $700 million project to establish a 1GW of renewable energy generation assets in South Australia, in part to provide a cheap, ongoing energy supply for the steelworks themselves.

ZEN Energy, which Gupta’s company GFG Alliance acquired a controlling interest in in September, announced the energy plan on October 30.

The company’s board endorse a four-pronged approach at a meeting on Monday.

These include a 200MW solar plant at the Whyalla steelworks and on nearby council land, a 100MW/100MWh battery at Port Augusta, 100MW of “demand response” at the Whyalla Steelworks and other sites, and 120MW/600MWh in pumped hydro storage at a disused iron ore pit in the Middleback Ranges.

The plan also proposes an additional 480MW of solar capacity, which can be installed in due course to support the expansion of industrial capacity in Whyalla and industrial loads elsewhere in South Australia.

“I am delighted ZEN Energy is able to hit the ground running,” Gupta said.

“These first steps in SA will improve reliability and greatly reduce costs of electricity in our own steelworks at Whyalla, and provide competitive sources of power for other industrial and commercial users.

“This will be followed by early steps to lower Liberty OneSteel’s electricity costs in NSW and Victoria, and to provide power at lower cost to other industrial enterprises in these states and in Queensland.”

Gupta said the company was watching policy developments in the energy market “closely,” but said ZEN was nonetheless ready to proceed with the first 520MW of its plan, “based on positive interactions with relevant stakeholders”.

“I believe there is a great future for energy-intensive industries in Australia,” Gupta added.

“I look forward to helping build ZEN Energy to become a major player in the Australian energy transition.”