The challenge

Rennie was appointed as commercial advisor to a global investment entity considering an investment in an electricity Transmission Network Service Provider (“TNSP”)

The investment structure included a related commercial subsidiary of the TNSP, for which Rennie was engaged to provide commercial, regulatory and operational due diligence. This subsidiary specialised in connecting generation and load customers to the National Electricity Market (NEM) and also provided telecommunications infrastructure and services.

Our client sought to understand the growth outlook for contestable connections, the subsidiary’s future competitive position, and the likely direction of project economics.

Our solution

We conducted a comprehensive review of the investment thesis, with a focus on validating key assumptions.

The assessment was structured around three core themes: 

• Expected growth in contestable grid connections 

• The impact of Renewable Energy Zones on the subsidiary’s future market position 

• The strength of project economics in supporting attractive returns 

The Rennie team delivered this by: 

• Developing forecasts for renewable generation capacity build-out through FY50, segmented by Renewable Energy Zones in NSW, VIC and other NEM states 

• Developing scenarios for growth in grid-connected datacenters 

• Estimating future capital expenditure (capex) requirements for contestable connection assets from FY25 to FY50, drawing on expert interviews and analysis of historical capex 

• Using market sounding calls to assess the target’s potential market share, considering how Renewable Energy Zones influence customer purchasing decisions and competitor dynamics 
• Analysing internal company data to evaluate the expected trajectory of project economics and internal rates of return (IRR) across the market 

Our impact

Rennie’s commercial, regulatory and operational due diligence gave the global investment entity the confidence to proceed with its investment.

Our insights directly informed the valuation of the subsidiary, enabling a more robust and competitive bid for the overall target.