​The investment case for energy parks in the NEM is growing as grid connections become harder to secure and the renewable transition increases the need for firming. Energy parks combine generation, storage and increasingly large electricity loads behind a shared connection. Wind can produce when solar cannot, while batteries fill the gaps.

Co-locating a load with supply goes a step further. Less electricity needs to travel through an increasingly constrained transmission network when electricity is consumed where it is generated.

The total firmed energy profile, especially with storage, improves grid response, though the assessment and registration process remains challenging for combined assets.

Data centres offer one of the strongest use cases for energy parks because compute can be located where electricity is available. Fibre optic cables are relatively cheap, while new transmission is costly and slow to build. Regional data centres can connect directly to available generation, improve MLFs, and reduce the need for additional network capacity.

Executive Summary

• Energy parks can extract more value from scarce grid connections and transmission by combining complementary generation, storage and load behind shared infrastructure.
• Australia has strong foundations for energy parks. Complementary resources and an established hybrid pipeline support development, but established grid regulation pathways are needed to bring that pipeline to operations.
• ​Wind and solar can each be sized to a full connection with limited clipping: costing just 0.25%–1.85% of revenue when scaling up capacity at four modelled NEM sites.
• Data centres could accelerate the next phase. They are the fastest-growing demand for co-located firm renewables and storage and the ability to site compute regionally.

Australia has the foundations for energy parks, but most projects remain in development

Australia’s energy park business case is supported with strong wind and solar resources, an established hybrid pipeline, and growing industrial electricity demand. Scarce connections and constrained transmission further strengthen the case for sharing infrastructure.

Energy park announcements are rising, but few large projects are operating today. Several combine one generation source with storage, or both solar and wind, but Kennedy remains the only operational one with all three.

Kennedy Energy Park was the first utility-scale wind (43 MW), solar (15 MW) and storage (2 MW / 4 MWh) project to be project-financed in the NEM. ARENA provided an $18 million grant to demonstrate the combination. CEFC provided $94 million in financing designed to demonstrate the bankability of integrated hybrid projects.

Kennedy’s commissioning delays exposed the challenges of applying connection processes and technical standards designed for single-technology projects. Introduced in 2024, the Integrated Resource Provider framework now provides a common registration pathway for generation, storage and consumption. However, complex hybrids can still face longer assessments and higher costs as assessment processes mature.

The CIS and LTESA scheme also incentivise hybrid development, but are structured to support one generation technology with storage. They offer limited additional incentives for combining multiple generation sources.

Energy parks go further, combining assets with different owners, contracts and operating requirements. Connection approvals must accommodate this complexity, while commercial arrangements and underwriting support should reward the network benefits these projects deliver.

Wind and solar can share a full connection with limited clipping

The distinct intraday generation profiles of wind and solar allow developers to install more combined capacity behind one connection. An analysis of the four NEM operating co-located wind and solar sites shows none clipped at the sizes actually built.

The optimal wind-to-solar ratio depends on the site’s diurnal profile. Most sites benefit from solar filling the middle of the day while wind produces when the sun is low.

Gullen Range demonstrates an exception. Wind production there is consistent through the day, reducing the value of adding midday solar. Its wind-to-solar capacity ratio is 1:16.

Still, even modelling both technologies sized to the full connection, clipping remains limited. Across the four sites, 0.78% of generation is clipped at Kennedy and 5.28% at Gullen Range.

The revenue impact is smaller again: 0.25% to 1.85%. Most clipping occurs when the plant is producing hardest and prices are lowest. Between 70% and 93% of clipped energy falls in the cheaper half of intervals, while around half of clipped energy at Kennedy and Gullen Range occurs at zero or negative prices.

Data centres are the easiest load to site with energy parks

Data centres offer more locational flexibility than industries tied to mineral deposits or port infrastructure. Their output travels through fibre optic cables, which are cheaper than transmission. This creates an opportunity to bring demand to generation, reducing the need to build transmission between them.

Early projects show the model emerging, although most are still closer to co-location than full integration.

For now, renewable supply remains sufficiently abundant in parts of the NEM that early data centres can contract electricity off-site. Batteries are being co-located first because they can come online faster and reduce data centre load variability, potentially lowering connection risk.

However, for newer data centres, transmission is increasingly a bottleneck for how quickly new generation and load can connect. 8.5 GW of data centre announcements in 2026 are sited regionally, compared with 2.2 GW in metropolitan areas. This move prioritises regional energy access.

What to watch next

Data centres are emerging as one of the clearest next use cases for energy parks, with flexible siting, large electricity demand, a load profile that incentivises pairing with batteries, and increasing regulatory pressure to build new renewables.

Australia has the resources, project experience and grid constraints to support more complex co-located development. The next phase is moving beyond renewable-plus-storage hybrids towards parks that combine generation, storage and load: requiring clearer models for connection, network charging and grid services.

The opportunity is to deliver more generation and serve more demand through the connection resources that are currently acting as a bottleneck.