Origin Energy has sold its under-development Darling Downs solar farm in Queensland to gas pipelines operator APA Group, but will buy all the electricity generated by the project until 2030.
The energy producer and retailer on Monday said it had divested its stake in the 110 mega watts project, for which it had secured a $20 million grant from the Australian Renewable Energy Agency (ARENA) late last year.
The project is located next to its gas-fired Darling Downs Power Station.
Origin will, however, sign a power purchase agreement with APA to buy all the renewable power generated by the solar farm, from start of operations in 2018 to 2030, boosting its renewables capacity further.
APA Group said, in a separate statement, it will acquire and develop the southwestern Queensland project for about $200 million, in addition to the ARENA grant, with construction to be completed in late-2018.
It is believed that Origin has spent around $10 million on development so far, which it will recoup from APA.
Origin has a target of signing up new renewables capacity of up to 1500 MW by 2020, and this latest offtake agreement takes to 650 MW the new capacity it has contracted over the past year.
In April, it agreed to buy the entire 220 MW to be generated from the under-development Bungala solar plant in South Australia.
The sale to APA is part of Origin's pledge to divest non-core assets worth $800 million in an effort to shore up its finances.
The sale process for divesting the gas pipeline infrastructure at Darling Downs is already underway.
The Queensland solar farm buy is APA Group's second foray into the solar sector, after it received approval in 2016 to develop the 20 MW Emu Downs solar farm in Western Australia.
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