NSW Opposition proposes Sydney-centric renewable energy plan, scaling back regional zones

Sydney-based solar energy and battery projects would be rammed up and major regional renewable energy zones scaled back under a NSW Opposition overhaul of its electricity policy.

Under the proposal, a Sydney City Renewable Energy Zone would be established to support greater use of solar and battery storage across industrial precincts, commercial buildings and apartment complexes in Sydney.

The Opposition said it would also accelerate work on similar renewable energy zones in Newcastle and Wollongong and back an Outback Renewable Energy Zone near Broken Hill.

Shadow Energy Minister James Griffin said the proposal would reduce pressure on the electricity network by producing energy closer to major areas of demand.

The Coalition would also establish a Delivery Coordination Office to work with councils, communities and industry to support the rollout of urban renewable energy projects.

Regional energy projects pushed back

If elected, the Coalition would also scale back the New England Renewable Energy Zone (REZ) and scrap its proposed 500-kilovolt transmission line corridor.

The New England REZ is one of five REZs for wind and solar farms in NSW established under the former Coalition government to support the shift away from coal-fired power.

It was legislated with the support of the then-Labor opposition and has since faced concerns about cost blowouts and some strong local opposition.

The Coalition announcement on Wednesday represents a major break from the bipartisan consensus it previously shared with Labor on the state's renewable energy rollout.

It said the project was over budget and behind schedule, promising a review of the REZ would prioritise upgrades to existing transmission infrastructure and remove the need for the transmission line corridor.

'Complete turmoil and chaos'

Premier Chris Minns said Labor would not support the plan, which he said would strand billions of dollars' worth of capital investment in New South Wales.

Mr Minns said the proposal would also put the state's energy plan "in complete turmoil and chaos".

"I think this is the first real-world example of One Nation having a massive impact on the Liberals and Nationals policy agenda and they're not even in Coalition with each other yet."

One Nation strongly opposes REZs and the transition to net zero carbon emissions, while advocating to replace REZs with coal, gas, nuclear and new hydro plants.

In the NSW government's budget on Tuesday, it announced an additional $225 million for infrastructure to connect the South West Renewable Energy Zone.

'Not a like-for-like substitution'

Ty Christopher, director of Energy Futures Network at the University of Wollongong, said it made no sense to establish a Renewable Energy Zone in Sydney.

"We need large-scale energy solutions so that we can deliver large scale energy for large industry and the like," he said.

"You can't put solar farms across existing built-up areas, nor can you install wind farms because there's not the wind resource there to power them in these urban areas across Sydney, it's not a like-for-like substitution."

Mr Christopher said a REZ in far western NSW was worthy of consideration.

He said a 2025 storm that knocked down transmission lines leaving Broken Hill without power, showed there was a need for more renewable energy and better policies in the area.

"There was a large-scale wind farm, solar farm, a large network battery, lots of solar on homes, and home batteries, none of which were allowed to operate in a islanded grid situation because the out-of-date rules we had said they couldn't."

"So I think that makes a strong case for a renewable energy zone out west."

Mr Christopher said it would be unhelpful for NSW and the country if the New England REZ was scaled back, even if additional zones were established.

"We would run the real risk of not having enough generation soon enough to replace the retirement of coal," he said.

"All of this comes down to, I'll be frank, what I think is the real agenda from the coalition is to keep us reliant on expensive fossil fuels for as long as possible."