NSW Roadmap Investor Day

NSW Electricity Infrastructure Roadmap Investor Day

Melanie Koerner

Good morning.

It’s great to see you all here today. My name is Melanie Koerner and I’m the General Manager of System Planning and Financial Markets at ASL. I’m delighted to have the chance to speak with you about something that sits at the foundation of New South Wales’ energy transition – ASL’s Infrastructure Investment Objectives report, or, the IIO.

At a time when the energy transition is moving from ambition to execution, the IIO exists for a very clear reason. It translates government policy into a system-led, consumer first investment plan, and then into real opportunities for capital. It’s not just theoretical modelling; it’s a blueprint that sets out what energy infrastructure New South Wales needs, when it needs it, and how ASL will incentivise it through its competitive tenders.

The IIO report defines two key things: a 20-year development pathway for the electricity system and a rolling 10-year tender plan, providing clear visibility on the scale, timing, and sequencing. For investors and developers like yourselves, the IIO is your signal. For how you engage now, to align your investment plan with our tenders, and in the long term, showing the ongoing need and certainty on the a pipeline of tenders 10-years into the future to support your projects.

Importantly, the IIO is designed from the outset to service the long-term financial interests of NSW consumers. Consumers are at the core of this transition, and our role as the NSW Consumer Trustee is to ensure we deliver a reliable, clean, and affordable system.

Back in 2020, as the Electricity Infrastructure Investment Act was passing through NSW Parliament, the then Minister for Energy, Matt Kean, in his second reading speech, said:

“In exercising its functions, the primary consideration for the consumer trustee will be the financial interests of consumers. That is important. It is clear that the consumer trustee will be making recommendations to achieve the relevant development pathways and the infrastructure investment objectives. However the structure deliberately provides flexibility to the consumer trustee to protect the financial interests of consumers… the development pathways and the infrastructure investment objectives are meant to be strong guides to the consumer trustee; they are not intended to be rigid rails which must be adhered to at all costs.”

The IIO and the Roadmap policy have endured through a change of government and now led by the new Minister for Energy, Penny Sharpe, continues to play this critical role.

Understanding the IIO

So, how does the IIO work, and why does it matter? As I mentioned, the IIO provides two critical timeline: the 20-year development pathway and the 10-year tender plan. The 20-year development pathway outlines, in broad terms, what the electricity system must look like over time to remain reliable, affordable and secure as coal exits and demand grows. This includes the amount of new generation and long-duration storage needed, and the firming and network upgrades required. The 10-year tender plan then turns that pathway into investable opportunities, setting forth when ASL will run competitive tenders for new projects, and how much we’ll seek. This gives the market a clear forward view on the scale, timing, and sequencings of upcoming tenders.

Taken together, these two elements – the development pathway and the tender plan – are what make the IIO such a powerful signal for investors. It aligns public policy with commercial action. ASL’s tenders are not standalone exercises. They are explicitly conducted on the basis of the IIO. That means the tender schedules all link back to delivering the IIO’s objectives in the long-term interests of consumers.

The IIO is a direct line from strategic plan to market action.

Moving beyond minimum targets

One of the key shifts in the 2025 IIO is the move from planning to simply meet the minimum objectives. NSW does, of course, have legislated minimum objectives for generation and storage. But the IIO deliberately goes further, setting ambitious ‘stretch targets’ for infrastructure development.

Why? Because planning only to the minimum objectives, and the reliability and energy security target would mean planning right to the edge. But the real world doesn’t behave neatly. Coal exits won’t all happen exactly on schedule; electricity demand is highly uncertain, driven by global and local trends in industrial and transport electrification, data centre development and adoption of CER. All very difficult to forecast. And project delivery risks are real. From planning and approvals, right through to construction, connection, and commissioning.

So instead of planning right to the edge, the IIO deliberately plans for the real world. To crowd in new capacity before coal retires; to manage attrition and slippage in project delivery; and to maintain reliability and price stability for consumers. This gives NSW a buffer. Even if some projects slip or fail – and we expect that will happen – the overall transition can still have its best shot at staying on track.

So, why do we expect that? Because history tells us this is the case. Some projects will be early, some will have inherent risks and not always reach the finish line. It’s a realistic view about delivery. Attrition is likely and planning accordingly for it is not a flaw. It’s the necessary strategy. We don’t want to be in a world where we’ve planned right to the edge and must ensure every project hits the finish line, irrespective of cost. So we plan for more, enough to get us there in a realistic view of the world; and we protect the long-term financial interests of NSW consumers in doing so, because the LTESA doesn’t pay out until a project starts generation.

So, for investors and developers, the signal is clear. NSW is stepping up, planning for more generation and storage sooner, and stands ready to support quality projects that can deliver in time. Delivering this vision won’t be easy. We intend to play out part in accelerating and de-risking investment through our LTESAs. In practice, our tender program is set to ramp up significantly, including larger, biannual generation tenders and annual storage tenders, to secure the projects we need. As you all know, we will shortly restart our Generation LTESA tenders with the largest ever round to date seeking approximately 2.5 GW of new generation capacity. Alongside this will be a major long-duration storage tender seeking 12 GWh.

These aren’t arbitrary. They flow directly from the IIO’s blueprint.

Technology neutral by design, but why wind is foundational

I want to speak now to a topic that is often the source of questions, and sometimes confusion. That is, how the IIO guides technology mix and why certain technologies emerge as critical under a technology neutral framework.

The IIO’s development pathway is technology neutral in design. We don’t assume quotas or fixed carve-outs for particular technologies. But technology neutral does not mean technology blind. The modelling and analysis behind the IIO identify which mixes of resources will deliver the highest system reliability and lowest costs for consumers over the long term. This is a hypothetical modelled outcomes and the actual technology mix we support depends on what we receive in LTESA tenders. As I quoted at the start, the development pathway and the targets “are not intended to be rigid rails which must be adhered to at all costs”. But it’s clear that some technologies are indispensable for NSW to meet its targets. Wind is one of them. An absolutely foundational piece of the energy transition in NSW.

Why such an emphasis on wind? Because it provides exceptionally high system value. It complements solar generation by producing when solar cannot, particularly overnight and during extended periods of low solar. Wind diversifies our supply, reducing reliance on any single source; and because its been easier to date to develop solar, the value of new wind has only increased.

Put simply. Wind is not optional; it’s essential to achieving the energy transition in NSW at the lowest long-term cost to consumers.

Supporting wind without quotas

A natural follow on question might be: if wind is so important, how does ASL support it without setting quotas? The answer lies in how the IIO and the Generation Investment Outlook feed into tender design.

We don’t set technology quotas within tenders. But we do make sure our process reflects system needs. In our tenders, all projects compete on value for money, and the market determines outcomes. Thimo will have more to say on that. However, those system needs are reflected in our tender design and in the way financial value is assessed. Where the pipeline shows that a particular technology is ahead of the curve – for example, solar – and another is falling behind – such as wind – that difference is reflected in ASL’s financial value assessment. In effect, the marginal system value of scarce or lagging technologies increases.

So we don’t arbitrarily favour one particular technology, but our tenders aren’t indifferent. They’re not “swung” to favour one technology over another. But nor are they purely technology-agnostic. They are system led. They respond to what the grid needs, where it’s needed, and when it’s needed, allowing market signals, rather than quotas, to guide investment toward the outcomes that deliver the most value for consumers.

Long duration storage

We’ve covered the generation element. But what about storage? The ambitious trajectory we’ve established for LDS reflects its critical role in supporting system reliability as coal generation retires. So as the target for generation increases, so too does long duration storage. To support that build out and maintain a reliable system.

For those that follow along closely, you may know we’ve already secured enough LDS to just meet our 2030 and 2034 targets. This represents strong progress, but as I said before, we recognise the inherent risk of delay and attrition; even within our own portfolio.

We want to contract further projects that can reach the 2030 date to ensure we hit the target. And our stretch target is larger – 42 GWh by 2034. That’s why our major tenders for storage are continuing. As with generation, we remain technology neutral and the tender outcomes will reflect relative value, deliverability and system benefits; and outcomes from that will inform the next steps. Where the marginal value sits. Where and when we need more.

So we’re using the IIO; and its tender plan; to maintain momentum towards these targets.

Firming

To round out all of our Infrastructure Investment Objectives – Firming.

Firming works a little differently to how we plan for generation and long duration storage. It represents an essential completement to renewable generation and storage, providing the responsive capacity needed to maintain grid stability as the electricity system transforms. Essentially, it refers to nay other dispatchable capacity and its tenders only occur on direction of the NSW Minister for Energy.

To date, we’ve run two firming tenders. Both were deliberately focused on addressing an immediate, short-term reliability need to provide capacity in and around the Sydney-Newcastle-Wollongong load centre. They were designed for a specific point in time and location. More firming before new transmission links are built to connect generation in the regions and key load centres. Reflecting that need, the successful projects were short duration batteries of 4 hours or less, located in, or able to support, SNW.

But the new firming direction is addressing a different challenge. It’s about looking ahead to the early 2030s in a system with much higher renewable penetration and transmission in place, connecting regional generation to demand. In that world, the firming task changes. What we’re planning for now is likely to be longer in duration and designed to support the system through extended lulls in renewable output; when the sun isn’t shining and the wind isn’t blowing.
We’re currently preparing our 2026 Firming IIO report. That work is addressing this specific need – it’s scale, it’s characteristics, and the role it will play alongside generation and LDS in keeping the system reliable. The report will be released in Q3 this year with a firming tender expected to follow shortly thereafter.

Like everything you’ve heard today, addressing this firming need will be system-led, realistic about delivery, and done in the best interests of consumers.

Supporting delivery now – the Generation Investment Outlook

A core them of the 2025 IIO is realism about delivery. Bridging the gap between plans on paper and getting projects built. We know that publishing a plan alone doesn’t guarantee projects getting built. That’s why we continuously monitor the on-the ground progress of projects through our New South Wales Generation Investment Outlook; the GIO.

The GIO is our reality check. A data driven pulse check on the pipeline.

The inaugural GIO, published alongside our 2025 IIO, revealed a consistent pattern. One that everyone in this room will be aware of: there’s more than enough capacity in the pipeline to meet the minimum objectives. But the challenge isn’t the lack of projects, it’s the pace at which those projects are reaching completion.

Projects tend to slow as they move closer to financial close. Attrition rises and the lead times are stretching. That’s why having headroom and ambition in the IIO matters so much. If we only planned to the minimum targets without buffers, any delay or attrition would negatively impact us.

Fortunately, our latest GIO indicates some positive trends as well. Wind project development is picking up pace, and momentum is returning, especially at the early stages of the pipeline. Hybrid projects have become the norm rather than the exception. Combining generation with storage supports both system needs and investment needs. We’re incorporating long duration storage into our next report too – so expect a name change!

These signs are encouraging, because early-stage development today is what underpins actual delivery in the coming years. For investors, the GIO offers transparency. It doesn’t just tell you what the targets are; it shows where momentum is building, where projects are slowing, and where risks are real. Importantly, the GIO is ASL’s reality check. It shows investors that our eyes are wind open. We’re seeing market conditions as they are, tracking the risks, and adapting.

What we see directly impacts how we think about our IIO and our tenders. Thimo will have more to say about how we are adapting to the changing market conditions in our tenders shortly.

The bottom line

To bring it all together, let me summarise:

• The IIO sets the direction;
• The GIO monitors reality on the ground; and
• ASL’s competitive tenders are the mechanism to close the gap between ambition and delivery.

This integrated approach is unique in the NSW Roadmap. We aren’t just planning, we’re bridging policy and commercial action in real time, ensuring system-led signals turn into actual projects. While ASL remains technology-neutral in procurement, the system signals are clear. NSW needs more wind, delivered sooner, to achieve the energy transition at the lowest long-term cost for consumers. We also need continued momentum from solar, storage, and other technologies to ensure that we continue seeing new capacity enter the NSW grid at this critical period of the energy transition.

Our job at ASL is to ensure that pathway is investable, deliverable, and grounded in real system needs. We’re not here to tell you exactly what to build or where to invest, the market will do that. But the signals are unmistakeable in our strategy. NSW has laid out a bold pathway, bigger and fast than before, because that’s what needed.

This ambitious plan, the blueprint for NSW’s energy transition, is key to unlocking the best outcomes for consumers. It’s called ambitious for a reason, because it is. But every new project closer to achieving it, the greater the value captured. So we invite all of you in the audience, planning and building projects, to take these signals and act on them. ASL will be there to provide you with the opportunity for support.

Thank you.

ENDS