New firming tender to protect NSW's energy security

Minister for Climate Change and Energy Penny Sharpe is directing a tender for projects that deliver 500 MW of firm capacity for NSW to boost the security and reliability of its energy grid.

This tender is to ensure NSW residents and businesses have reliable power when they need it, especially during high-demand periods like heatwaves or cold snaps.

The state is forecast to face shortfalls of firm capacity for the summer of 2027–28.

The tender will seek bids for firming infrastructure — such as batteries, gas generation and virtual power plants — that can rapidly supply electricity to the grid or reduce the use of electricity at short notice.

The projects supported by this tender will be capable of powering around 200,000 homes during times of peak demand.

The tender will be conducted by ASL (formerly AEMO Services) later this year, and priority will be given to projects that can supply the Sydney, Newcastle and Wollongong areas (where the shortfalls are forecast) during times of peak period.

“The announcement of this tender for firming infrastructure demonstrates the flexibility and adaptability of the NSW Electricity Infrastructure Roadmap in bringing forward additional energy capacity in response to an identified need,” said ASL Chief Executive Officer Nevenka Codevelle. “Firming infrastructure plays a crucial role in supporting the reliability of the NSW electricity system, with this tender calling on projects to come forward that can support the Sydney–Newcastle–Wollongong region by the summer of 2027/28.”

Successful projects will join those supported in the state’s first firming tender in 2023, with the likes of AGL’s Liddell battery, Akaysha Energy’s Orana battery, Iberdrola’s Smithfield battery and the large-scale virtual power plant being delivered by Enel X.

Sharpe announced the tender while addressing the 2025 Australian Clean Energy Summit in Sydney.

“The Minns Labor government has always been clear that we will make decisions to keep the lights on and the energy transformation underway,” Sharpe said. “This tender will provide greater certainty against future reliability risks.

“We are proactively managing the risks associated with delivering multiple large-scale infrastructure projects at once, as we rebuild our energy system.”

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