lllawarra named as NSW's first urban renewable energy zone in push for local power solutions
The NSW government has launched a new approach to renewable energy in the Illawarra, pitching the region as the state's first "urban renewable energy zone".
The model leans heavily on local solar, community batteries, and existing infrastructure rather than large-scale projects.
Energy Minister Penny Sharpe said the plan marked a shift from traditional renewable energy zones (REZs) in places like the Orana and South West.
"It's not about big generation and transmission," she said.
"It's about how we support the infrastructure that's already here, how we prepare for green manufacturing, and how we make the most of the solar and storage potential across homes, businesses and communities."
The announcement in Port Kembla at the BlueScope steel terminal — where renewable energy research is underway — included a memorandum of understanding with Endeavour Energy.
It set the groundwork for trials of new grid technologies and incentives for solar uptake.
Endeavour's Colin Crisafulli said the goal was to make the most of the infrastructure already in place.
"We're looking at how we can store more energy, share it locally, and avoid rebuilding the grid where we don't need to," he said.
At the University of Wollongong, energy researcher Ty Christopher said the consumer focus in the REZ could deliver 300 megawatts of local energy.
"An urban REZ could certainly get it into the hundreds of megawatts of capacity," he said.
"With more generation on homes and businesses, and in particular with the ability to store and time shift all of that clean energy so that it's available in the evening ."
He said leaning into the local support for renewables with an urban REZ would "really play to the strengths of the region".
Even with the local consumer energy contributions, the government is still a way off its commitment of 1 gigawatt of energy creation for the Illawarra zone.
Professor Christopher said the local REZ would still require bigger solutions like offshore wind to power heavy industry like BlueScope.
"You can't run a steelworks on rooftop solar," he said.
"This needs to be part of a bigger mix, but this is something we can start now.
"One of the big challenges from a political perspective with the Urban REZ concept is it's not going to create one big thing that you can string a ribbon in front of and just cut.
The announcement came just days after the federal government lifted a pause on consultation for offshore wind off the Illawarra coast.
The applicant, BlueFloat, told the ABC it was not discussing the Illawarra project but focused on its plans for the Gippsland offshore wind zone.
Hi Neighbour founder Yael Stone, who earlier this year criticised the lack of visible progress since the Illawarra REZ was first announced, welcomed the urban REZ approach as a smart and community-led next step.
"I'm thrilled at the announcement," she said.
"It reflects what groups like Electrify 2515 and Hi Neighbour have been working toward — small-scale, local energy projects that create jobs and cut bills."
She said Illawarra residents were already tuned in to the benefits of household solar, batteries and smarter grid interaction.
Stone saw the urban REZ concept as a "companion piece" to the federal move to resume offshore wind planning and said her group had already helped install solar on local manufacturing rooftops, using the returns to fund training scholarships.
"There's a kind of circularity that feeds itself — these projects create economic benefit and they enrich communities," she said.
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