Construction of one of Australia’s first pumped storage power plants in several decades is ready after project developer Genex announced that it has signed contracts with key construction partners.

Genex proposes building a 250 MW / 2,000 MWh pumped storage facility on the site of the former Kidston target mine to develop a larger vision for a clean energy area in the region.

On Wednesday, the company announced that it has signed an engineering, procurement and construction (EPC) contract with a joint venture between McConnell Dowell and the John Holland Group to carry out the major construction work at the Kidston site.

The joint venture will complete the construction of the dam infrastructure, underground works and the construction of the on-site generator infrastructure for power generation and water pumping.

The Kidston Pumped Hydro project is the flagship project for Genex and will utilize two disused gold mines where the mining pits will be used to store water that will be moved between the two pits as needed. A solar farm is already in operation on the site, but Genex hopes to add more, as well as a wind farm.

Beon will also be tasked with building the necessary grid connection and substation work in Kidston that will connect the pumped hydropower project to the transmission grid.

Genex told network operator Powerlink to begin construction of a new transmission line between Kidston and the main network, which will include building a new 186 km 275 kV transmission line from Kidston to a new switch construction on Mount Fox, roughly halfway through construction Route between Townsville and Cairns.

The signing of the construction contracts is an important milestone for the company. With the project contracts now in place, construction work for the pumped storage power plant with 250 MW / 2,000 MWh with around 800 employees could begin on site.

The announcement follows that the company is securing the necessary funding for the project through a new share placement on the ASX after lengthy negotiations with potential equity partners have failed.

Genex announced last week that it will raise an additional $ 115 million in equity from a mix of institutional and existing retail shareholders and a $ 25 million investment from a key J-Power partner to keep the company 100 percent can the Kidston Pump-Hydro project.

The Australian Renewable Energy Agency also agreed to support the project with a $ 47 million grant, after Genex had previously received a $ 610 million loan from the North Australian Infrastructure Facility.

“Following our successful fundraising last week that secured the final part of the project funding for the Kidston Pumped Storage Hydro project, I am pleased that we have now finalized all project agreements and started work on developing the transmission infrastructure that supports the project with the national electricity market, ”said James Harding, CEO of Genex.

Genex has also signed a maintenance contract with the Austrian hydropower company Andritz Hydro for the ongoing maintenance of the pumped hydropower project and an engineering contract with the Tasmanian government Entura.

Project financial data released by the company shows that it expects to generate relatively stable revenue from the project through an energy storage service contract with EnergyAustralia.

Under the contract, Genex will receive recurring access payments from EnergyAustralia, who will be able to draw on the Kidston Storage Project for additional electricity supplies during key periods to help the electricity trader reduce their risk of electricity price spikes during peak periods.

The Kidston hydropower pumped storage project will be the first in Australia in several decades and only the fourth ever built in Australia, alongside facilities from the Snowy Hydro and Shoalhaven programs in New South Wales and the Wivenhoe Dam in Queensland.

Genex intends to bundle a number of wind and solar energy projects around the pump hydropower plant and already operates the 50 MW Kidston solar park.

Michael Mazengarb is a journalist with RenewEconomy in Sydney. Prior to joining RenewEconomy, Michael worked in the renewable energy field for more than a decade.