A year after it was designated a Renewable Energy Zone (REZ), billions of dollars in renewable projects proposed for the New South Wales Illawarra region have failed to materialise.

The zone was forecast to create more than 8,000 jobs, as the region transitions one of its oldest workforces — coal miners — into new employment. 

The Russell Vale coal mine, north of Wollongong, closed suddenly earlier this month due to safety issues putting more than 200 miners out of work.

Darryl Best spent 43 years in the coal industry, working in almost every mine in the southern coal fields.

He said there were currently few opportunities for Illawarra coal miners hoping to transition into the renewable sector.

"There are no alternatives," he said.

"When I was working in a coal mine, and you heard that a renewable energy zone had just been established, you thought, 'What does that mean? What is it? How does it work?'

The Illawarra was declared the state's fifth REZ in February 2023, following an expressions of interest phase that attracted 17 gigawatts of energy generation projects — amounting to $43 billion.

But a year later, not a single renewable project proposal linked to the REZ has been submitted to the NSW government.

The five Renewable Energy Zones were established as part of a 20-year plan to replace the state's ageing coal-fired power stations and power the state towards net-zero by 2050.

The inland zones in New England, the Central West Orana, and Southwest have attracted dozens of projects in various stages of development.

Illawarra REZ 'unique'

Ty Christopher, the director of the Energy Futures Network at the University of Wollongong (UOW), said the Illawarra REZ was "unique" in that it would be used to both produce and consume clean energy.

"It was what I would call a 'two-way' Renewable Energy Zone," Mr Christopher said.

"It is not just a location where new clean electrons can be generated and injected into the grid, but it is also one of the key locations where those clean electrons will find a home.

The statutory body set up to manage the zones, EnergyCo, is currently facing local opposition to establishing new transmission infrastructure.

While the state government's attention was focused on building this "trunk infrastructure", Mr Christopher said investors could be putting their plans for the Illawarra on hold.

"The Illawarra REZ has not been getting the resource commitment from the NSW government that the other more advanced ones have," he said.

"What that means is there is less certainty for new investors, for the project proponents."

REZ on track, member says

In industrial hubs like Port Kembla and Newcastle, the existing transmission infrastructure is inadequate for future heavy industrial processes such as green hydrogen and green steel.

The NSW Planning Minister and Member for Wollongong Paul Scully was key to the declaration of the Illawarra and Hunter as Renewable Energy Zones while in opposition.

"While we haven't seen a project as yet in the Illawarra Renewable Energy Zone, what we are seeing is that work is going on behind the scenes," Mr Scully said.

"To make sure we are making the right investments to make sure we have a network that can carry that energy generation capacity for the region."

Mr Scully said this would involve upgrading the 132 kilovolt transmission lines to 550kV to accommodate the increased load.

"What has been the big congestion point in the system is making sure the network capacity is up to taking the energy from where it is being generated to where it is being used," he said.

"That important work is what is going on with EnergyCo at the moment and that is the baseline work before you look at the best mix of generating options that might work for an Illawarra [REZ]."

EnergyCo said there was capacity for several renewable projects to connect to the Illawarra grid.

"We expect that at least 1GW of additional network capacity will be needed in the 2030s to decarbonise industry and connect further new generation," a spokesperson said.

'Complacent' about end of coal

Darryl Best is now committed to helping establish renewable projects in regions like the Illawarra where coal mines are closing.

He said the Illawarra was less prepared for the looming transition than other coal-producing regions such as the Hunter.

"We have to change and … to develop a new industry for these people to go into and those industries are going to be renewables," Mr Best said.

Ty Christopher said the argument that Illawarra mines would have a longer life span because they produced coal for steelmaking was flawed.

He said coal workers in the Illawarra were facing the same future as miners in the Hunter.

"[The Illawarra] is not far behind them at all in terms of people's lives being affected by the transformation of the industry," Mr Christopher said.

"I think we need to be very careful not to be complacent about that because we are still subject with all coal industries to global markets and global market forces.

"It is the case of you don't need to be an environmentalist in all of this, you just need to be a capitalist to see where the money is going."