New South Wales to Launch 500 MW Firming Capacity Tender to Strengthen Grid Reliability

The New South Wales (NSW) government has announced plans to initiate a new tender for 500 MW of firming capacity, aiming to sign Long-Term Energy Service Agreements (LTESAs) that will enhance the reliability of the state’s power supply.

This upcoming competitive round will invite bids for firming technologies such as battery storage, virtual power plants, and gas generators—solutions capable of quickly injecting electricity into the grid or reducing demand when needed. Priority will be given to projects located in high-demand areas like Sydney, Newcastle, and Wollongong, especially those that can begin operations by the summer of 2027–2028, when the state is expected to face firming capacity shortfalls.

The tender will be launched later this year by ASL, formerly known as AEMO Services. Once operational, the selected projects are expected to support the electricity needs of approximately 200,000 households during peak demand periods.

“This tender will provide greater certainty against future reliability risks,” said NSW Minister for Climate Change and Energy Penny Sharpe.

This will be NSW’s second tender focused on firming capacity. In its first round two years ago, the state selected six projects totaling 1,075 MW, in coordination with the Australian federal government’s Capacity Investment Scheme.