Oven Mountain Pump Hydro Project

Scope: Develop Australian Industry Participation Plan

Industry: Renewable Energy

Project Cost: $1 billion

The Oven Mountain Pumped Hydro Energy Storage project is a $1 billion, 600 megawatt, 'off river' facility located adjacent to the Macleay River between Armidale and Kempsey, in the New England region of NSW. The construction of this major piece of renewable energy infrastructure is being overseen by Oven Mountain Pumped Storage (OMPS).

8 Initiatives for Local Industry Development

10 Initiatives for Local Employment Development

Overview

Under the NSW Electricity Infrastructure Investment Act 2020 No. 44, all renewable energy projects are required to develop an Industry and Aboriginal Participation Plan (IAPP). The development of the IAPP must consider the requirements of the project’s Environmental Impact Statement (EIS) and other key economic impacts on both the project and the regional community.

In August 2022, OMPS engaged Hughes et al (HEA) to collaborate in the development of their projects’ IAPP. In mapping out the plan structure, HEA considered the role the IAPP would play as a central document. This consideration saw the objective of the IAPP evolve from a compliance led document to a market engagement plan that would support project design, constructability, and resourcing considerations.

HEA developed the IAPP to align with Australian Industry Participation Plan (AIP Plan) requirements, and the core elements of industry participation focused on opportunities for the use of Australian steel, the development of manufacturing capabilities, and the unbundling and identification of opportunities for the local supply chain.

The HEA team utilised information gathered from our previous market analysis for the OMPS project, in partnership with Industry Capability Network (ICN) NSW, to further validate and inform the IAPP development.

The IAPP was also designed to differentiate between the development and engagement of supply chain capability through procurement practice, and the engagement of workforce capacity through human resources practice, to serve as both a supply chain and employment “deliverability” strategy document. To that end, HEA detailed action plans in the appendices, that outlined specific strategies and a corresponding range of initiatives to be undertaken to achieve the strategy objectives.

A key element of the IAPP is Aboriginal participation, with the OMPS team working with Traditional Owner groups and other key Aboriginal Leaders to ensure adequate opportunities were provided to Aboriginal peoples and businesses. This commitment was recognised in a dedicated OMPS Aboriginal Participation Plan (APP) which expanded on key strategies listed in the IAPP.

    1. How to align local content practice to meet the NSW Government requirements on IAPP.

    2. The importance of capturing local initiatives and strategies into a plan that can inform design optioneering and constructability.

    3. The role an IAPP plays in focusing on industry targets, specifically targets for steel and manufacturing.

    4. Delineating capability (suppliers) with capacity (workforce) to then ensure highly interfaced and joined up solutions.

    5. Recognising industry and Aboriginal strategies as independent, yet closely interfaced functions, that are mutually supportive in creating economic value for a diversity of stakeholders.

  • The key challenge in developing the OMPS IAPP was ensuring that the plan aligned with commitments and targets being agreed under the Long-Term Energy Services Agreement (LTESA) and specifically the targets around the use of steel in construction, and then more broadly the requirement to procure for positive Environmental impact.

    Another key challenge was the local capability, capacity and experience in the delivery of major construction projects coupled with the responsibilities of ensuring that economic risks such as labour draw from existing local employers in agriculture, health, education and Council were mitigated.

    The OMPS team also had the additional objective that the plan be designed as a document that would be cascaded into the overarching procurement process for the contractors selected for Early Contractor Involvement (ECI), to clearly define the terms of engagement and the targets that OMPS have set to achieve in the delivery of the construction works packages.

    HEA worked with OMPS and other key industry stakeholders to develop a rigorous plan that meets Federal, State, Regional and industry requirements. Importantly the plan also set the tone for all future local procurement and employment engagement, while also being respectful of Aboriginal engagement and providing opportunities for Traditional Owners within the project delivery.

  • Following the success of previous projects with OMPS, HEA again established a shared Basecamp project management system for the rollout of this contract. Utilisation of Basecamp enabled everyone, in every role, to store, work on, discuss, decide and deliver on project requirements. All project information, tasks, events, documents and communication were able to be stored and organised in one centralised place, fostering greater collaboration and open communication within the HEA and OMPS teams.

    To compliment the Basecamp system, a private SharePoint cloud server for OMPS and HEA teams to access was also established, to make sharing of early research and documentation and revisions of Plans and associated documents easier.

    At a regional ecosystem level, the OMPS IAPP development demonstrated the importance that hydro-electric power plays in the development of Renewal Energy Zones (REZ) skills and capability. The accessibility to manufacturing opportunities is significant and any capability developed in these areas supports not only the project, but also the local economy once the construction period is over.

    In delivering the OMPS IAPP, further regional ecosystem consideration also had to be given to the cumulative impacts of the OMPS project on the local and regional economy in the context of other major projects, in this case the $2.2bn Coffs Harbour Bypass project, being undertaken by NSW Government.

  • Collaboration with different OMPS functions and other key internal and external stakeholders was essential to the success of developing and implementing the IAPP. Facilitated workshops, weekly review meetings and shared systems, were also at the heart of our collaborative delivery approach, making it easy to co-design, author and review the IAPP.

    Field visits into the region also offered the HEA team valuable insight into developing the plan, with the team being able to see firsthand the local industry capability, while also gaining insight into current local industry capability.

    Several key stakeholders and technical advisors including Armidale Regional Council, Kempsey Shire Council, Australian Steel Industry and ICN NSW were identified and met with during time spent in the community, with their insights providing valuable input into framing the final IAPP.

    As previously highlighted, a key element of the IAPP is Aboriginal participation, and to that end the HEA team worked with Traditional Owner groups and other key Aboriginal Leaders to ensure adequate opportunity was provided to Aboriginal peoples and businesses within the IAPP. This commitment was also recognised in a dedicated OMPS Aboriginal Participation Plan (APP) which expanded on key strategies listed in the IAPP.