Global funds management giant Brookfield says it has signed an agreement with Indian energy major Reliance that could lead to solar, battery and wind manufacturing facilities in Australia to help meet its huge renewable project pipeline.
Brookfield is hoping to buy the Origin Energy utility business as part of an agreed – but not yet approved – $18.7 billion purchase, and plans to spend up to $30 billion building 14GW of new wind, solar and storage by 2030 to meet its 1.5°C climate targets.
But with many projects being held up global supply constraints and intense competition for components in rival countries, Brookfield has signed a memorandum of understanding (MoU) with Reliance to make those parts in Australia.
Reliance – ranked as the biggest private sector company in India – is the major shareholder in Sterling and Wilson, which claims to be the biggest EPC contractor for solar projects in Australia, and is also branching out into wind energy and battery storage.
In a statemet issued from Mumbai, the two companies say they are looking to “accelerate and de-risk” Australia’s energy transition by enabling it to locally produce PV modules, long duration battery storage andcomponents for wind energy.
“Under the terms of the MoU, Brookfield will work with Reliance to explore avenues of direct capital investment and development of skills, knowledge and expertise in the renewable energy sector of Australia to facilitate the nation’s transition to a net zero future,” the statement says.
It notes customers will include Origin Energy. “Reliance has strong expertise in solar panel technology and long duration battery storage technology. It is currently in the process of setting up one of the world’s largest integrated renewable energy manufacturing facilities in India,” the statement says,
Australia has a massive pipeline of potential wind, solar and storage projects – both to meet its ambitious target of 82 per cent renewables by 2030, and to support the furtherelectrification of transport, buildings and industry, and opportunities in green hydrogen and ammonia.
But Australia makes few of the components needed for this buildout, apart from some wind towers and a small solar PV manufacturing plant, despite exporting many of the materials, and the solar PV know-how, to other countries.
The federal government recently allocated funds to pursue the “silicon to solar” goal of re-establishing a solar PV manufacturing facility in Australia, which now relies on China for nearly all of its PV modules.
See: Can Australia manufacture the billion solar panels it needs to be a renewable superpower?
Reliance and Brookfield says making components in Australia could create about 18,000 direct and indirect jobs, many in regions most impacted by the energy transition such as the Hunter Valley in New South Wales and the La Trobe Valley in Victoria.
“Australia has a proud history of manufacturing and an abundance of raw materials, but the industry is not crrently cost competitive,” said Luke Edwards, the head of renewables in Australia for Brookfield.
“We want to help kickstart a new era in local manufacturing that will benefit domestic renewables developers, including Origin Energy Markets, and many communities around Australia.
We are establishing these types of global partnerships in manufacturing now to allow us to get started as quickly as possible given the ever-reducing timeline for Australia to reach its first emissions-reductions targets in 2030.”
He said Brookfield is uniquely placed to support these manufacturing initiatives given its track record in committing long-term capital, including for essential and strategic manufacturing processes such as its investment in the $US30 billion Intel Chip plant in Nevada.
RenewEconomy has reached out to Brookfield and Reliance for further comment.
