)
A Western Australian company that plans to build a 120MW direct-current solar project with battery capacity has appointed former Premier Mark McGowan as non-executive chairman, shortly after Frontier Energy (ASX: FHE) received certified reserve capacity (CRC) status which guarantees fixed dollar payments.
With a market capitalisation of approximately $208 million, Frontier Energy plans to become a significant energy producer in WA by 2026 via its planned Waroona Renewable Energy Project, located 120km from Perth in the state's southwest.
A definitive feasibility study was completed in February that confirmed Waroona would generate average annual earnings of $68 million over its first five years of production, with a solar energy generation forecast of 258GW hours in the first year of which almost half would be discharged or sold from its battery infrastructure during peak periods.
Frontier's plans received a boost with $215 million in senior finance debt committed for Waroona's stage one development, with the funds to come from Infradebt which has also invested in Genex Power's 50MW/100MWh Bouldercombe Battery in Queensland and Neoen’s 100MW/200MWh Capital Battery in the ACT.
The project then received further support last week when Frontier announced the Australian Energy Market Operator (AEMO) had assigned CRC status to Waroona, implying payments of up to $27 million per year - or 36 per cent of revenue - for stage one of the project.
The company highlights McGowan's leading role in assisting WA’s transition from fossil fuelled electricity generation towards renewables during his time as Premier from 2017 to 2023.
"We are delighted to have Mark on board as non-executive chairman especially with his strong and strategic focus on sustainable, green energy in WA while he was the Premier," says executive director Grant Davey.
"It was announced last week that Frontier has received certified reserve capacity. The reserve capacity mechanism is unique to Western Australia and allows us to execute Stage One of the Waroona Project.
"This is the first step in our strategy to become a large-scale producer of renewable energy. We look forward to working closely with Mark as the company remains focused on delivering significant shareholder value in this era of energy transition."
McGowan looks forward to working closely with the Frontier to ensure "its strategy is realised for the benefit of shareholders, key stakeholders and all West Australians".
"Throughout my tenure as Premier of Western Australia, I worked towards a clean energy transition for the State whilst ensuring energy security was always a priority," he says.
"Frontier’s Waroona Project stands out as a significant asset in Western Australia’s transition, at a time when energy security is paramount, and the state continues to experience new demand records."
The former Premier's compensation includes a variety of options at different prices that will expire in December 2027. If McGowan were to execute the options and sell at the current market price, he would stand to make a profit of $495,000.
FHE shares are up almost 10 per cent at the time of writing at 51 cents per share.
Enjoyed this article?
Don't miss out on the knowledge and insights to be gained from our daily news and features.
Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.
Support independent journalism and stay informed with stories that matter to you.
)
)
)
)
)
