- Frontier's flagship project, Bristol Springs, has access to world-class infrastructure which considerably reduces both upfront capex and its overall development timeline.
- The acquisition of Waroona Energy will serve as a capstone on Frontier's development strategy, adding 355 MW of solar power generation with the capacity to expand up to 1 GW.
- The company is expected to generate major news flow as it moves towards FID on multiple development opportunities in 2024.
- These are the strongest ever market conditions for both renewable energy and hydrogen deployment. A near-term, fully integrated renewable energy and hydrogen producer, Frontier Energy is ideally positioned to benefit from these conditions.
- The South West Interconnected System, Western Australia's primary power grid and energy market, is in dire need of investment in new electricity generation.
- The current demand forecast over the next decade ranges from 78 percent to 220 percent. Meeting this demand will be even more challenging given that the State intends to close all coal-fired power capacity, which currently accounts for roughly 30 percent of power generation, by 2030.
- SWIS currently generates only 35 percent of its power through renewables, far below the Australian government's target of 82 percent.
- The company has a three-pronged development strategy, beginning with the establishment of solar infrastructure as a foundation followed by the planned construction of a dual-fuel hydrogen peaking plant and entry into the green hydrogen market.
- Frontier's end goal is to develop a scalable renewable energy hub which will create long-term sustainable value and provide a significant contribution to both the State and Federal decarbonisation strategy.
As Western Australia continues to face a looming energy supply-demand deficit within the next decade, significant investments in power generation for the region are imminent and Frontier Energy (ASX:FHE, OTCQB:FRHYF) is perfectly positioned to potentially become not only a key part of the State’s energy solution in the immediate future, but also benefit from what is forecasted to be record-high energy prices.
The South West Interconnected System (SWIS), the main electricity grid for Western Australia’s southwest region, is in immediate need of considerable investment in electricity generation for the region, with the Australian Energy Market Operator projecting an increase in energy demand of between 78 and 220 percent.
The challenges this forecast represents are only further exacerbated by the Federal Government's plans around renewable energy. By 2030, Australia aims for 82 percent renewable power generation. This includes the planned closure of all coal-fired power capacity by the same year, which represents roughly 30 percent of supply.
Only 35 percent of the SWIS is currently generated by renewable energy.
Whilst the State is planning a major expansion of the grid, this will take time and considerable cost. Following this expansion, additional investment and further time for approvals are required to develop new energy to connect to the grid.
WA’s issues are by no means an isolated event on a global scale, with grid constraints consistently identified as the major roadblock to achieving its renewable energy targets, all while also ensuring energy security and stable supply.