A 150-megawatt solar thermal power plant has been secured for Port Augusta in South Australia, State Premier Jay Weatherill has announced.
Construction of the $650 million plant will start in 2018.
Mr Weatherill said the Aurora Solar Energy Project would be ready to go in 2020 and would supply 100 per cent of the state government’s needs.
The government will pay a maximum of $78 per megawatt hour.
Mr Weatherill said the solar thermal plant was “the biggest of its kind in the world”.
“Importantly, this project will deliver more than 700 jobs, with requirements for local workers,” he said.
In September 2016, the government launched a tender process to procure 75 per cent of its long-term power supply.
It said it wanted to attract a new competitor onto the market and put downward pressure on electricity prices.
The government contract with operator Solar Reserve would last for 20 years, and was the “lowest cost option” of shortlisted bids for the project.
The maximum government load is 125MW, meaning the plant would be able to supply other customers.
“This, in addition to our state-owned gas plant, and the world’s largest lithium ion battery, will help to make our energy grid more secure,” Mr Weatherill said.
Solar thermal uses heliostats, or mirrors, to concentrate sunlight onto a tower that heats molten salt.
The heat created is then used to generate steam.
Solar Reserve said the plant would be able to provide between eight and 10 hours of storage and had no requirement for gas or oil generated electricity as a backup.
It is expected to employ 50 full-time workers on an ongoing basis once it is operational.
The company said the power station would operate in a similar fashion to a coal or gas station, meaning many of the jobs would “require the same skill sets”.
Solar Reserve chief executive officer Kevin Smith said he looked forward to supporting “federal and state renewable energy targets”.