The challenge

Seeking entry into the Australian renewable energy market

The client is an international engineering, property and infrastructure company with strong EPC credentials. Their vision is to become a leader in the Australian infrastructure and construction sector by offering innovative, breakthrough and dependable solutions for large-scale public infrastructure projects and private investment opportunities. The client is seeking to enter the Australian renewable energy market through investments in development stage projects and engaged Rennie to support in building understanding of the renewable deal structures, valuations for development projects and demand for renewables. The client required further insights to help enable investment decisions on Australian renewable energy investment opportunities.

Our solution

Assessing investment opportunities and strategy

The team advised on renewable energy project deal structures, common investment criteria and conditions precedent typically included for acquisitions of renewables. The team also assessed the demand for renewable energy projects at a state and whole of NEM level against planned projects and their likelihood of achieving COD. Key findings were also provided on the typical project development process including streams, timing and key milestones and how these differ between technology types. 

Analysis was focused on two main topic areas, being the client’s equity partner strategy and Tasmanian project opportunities. In regards to equity investment in renewable projects and a potential renewable platform, a number of topic areas were assessed. These include an overview of project development stages and participants, equity value of projects as they progress through development stages, archetypes of participants in Australian renewable energy generation development, transactions and investors in developments and pathways to securing equity. Another area of investigation included the Tasmanian renewable energy market. Topic areas assessed include forecast supply and demand in Tasmania, impact of the Marinus Link interconnector, non-commercial factors to right-size generation, outlook of LGCs and impact on project valuation, and Tasmanian PPA pricing, market activity and participants. 

Our impact

Comprehensive insights to inform decision-making

Findings developed by Rennie were presented in a due diligence style report to the Investment Committee to assist in making decisions around the client’s market entry strategy into the Australian market and appetite to further explore investment into specific renewable asset projects.

Key insights

• Insight into renewable project deal structures and models
• Analysis of typical development terms and conditions precedents
• Overview of the renewable project development process (incl. milestones, drivers and other activities)