The Pulse | 10 September 2025

NSW Energy Transition Lights the Way with Project Delivery and Regulatory Challenges in Focus

This edition of The Pulse examines a NSW construction sector driven by a powerful, state-backed clean energy transition, yet tempered by significant project delivery and regulatory challenges.

Large-scale investment is flowing into battery storage and transmission infrastructure, with projects like the Waratah Super Battery and HumeLink underscoring the scale of this transformation [13, 10]. 

This top-down push is mirrored by a grassroots boom in residential and commercial battery uptake, spurred by government incentives [5, 9, 19]. 

However, this rapid progress is creating tensions, with renewable projects facing legal challenges from local councils and growing calls for improved community consultation and compensation frameworks [6, 18]. 

Concurrently, major transport infrastructure projects are hitting key milestones, showcasing both innovative delivery methods and the financial impact of regulatory compliance failures [3, 8, 14]. 

As the government introduces planning reforms like the Transport Oriented Development program to tackle the housing crisis, the industry is also bracing for new legislation with the Draft Building Bill 2024 and navigating complex contractual disputes [17, 22, 20].

The Clean Energy Transition: Investment, Infrastructure and Community Impact

NSW is undergoing a rapid and large-scale energy infrastructure overhaul, marked by substantial investment in energy storage and transmission. 

Akaysha Energy has secured a landmark A$300 million debt facility to expand its grid-scale battery assets, including the recently commissioned first stage of the 850 MW Waratah Super Battery [13]. 

This is complemented by Endeavour Energy's subsidiary Ausconnex, which is advancing a $150 million, 200 MWh battery project in Unanderra, classified as a State Significant Development [21]. These large-scale projects are key for grid stability and are designed to store renewable energy to meet peak demand [21]. 

The backbone for the energy transition in NSW, the 365km HumeLink transmission line, is also moving into its main construction phase, requiring the establishment of accommodation for up to 1,200 workers to support the project [10].
The transition extends beyond large-scale utility projects. The commercial and industrial sector is actively participating in the transition, as seen with the completion of a $12 million solar and 11 MWh battery system at the Arnott's Group factory in Huntingwood [9]. 

At the consumer level, a "perfect storm" of federal and state rebates, rising power costs and falling feed-in tariffs is driving a rise in home battery installations in regions like Kiama and the Blue Mountains [5, 19]. 

However, this rapid development is not without challenges. The Hills of Gold wind farm project near Nundle, NSW faces a legal challenge from the Tamworth Regional Council in the NSW Land and Environment Court, despite having state approval [6]. 

Furthermore, there are growing calls from regional representatives for stronger, legally mandated consultation and compensation frameworks for landowners impacted by renewable energy projects, highlighting a notable gap between state policy objectives and local community consultation [18].

Major Project Milestones and Delivery Challenges 

Sydney's major infrastructure pipeline continues to advance, with several key projects achieving significant milestones while others highlight ongoing delivery risks. 

On the Warringah Freeway Upgrade, a new 46-metre underpass has opened, set to improve traffic for 10,000 vehicles daily and enable work for the future Western Harbour Tunnel [14, 15]. 

The Sydney Gateway project also demonstrates delivery success, where the use of 121 unique precast concrete shells was key to meeting a tight six-month installation window and avoiding project delays of up to a year [8]. 

Similarly, the Sydney Metro West project saw a continuous concrete pour of 3,042m³ completed nine hours ahead of schedule, showcasing the efficiency gains from careful planning and supply chain collaboration [7].

In contrast, the Sydney Metro extension from Sydenham to Bankstown is now facing delays pushing its opening to mid-to-late 2026 due partly to insufficient fire hydrants on station platforms, a safety concern first raised by Fire and Rescue NSW in 2018 [3]. 

Beyond heavy infrastructure, development remains active across various sectors. Early procurement is underway for a $1.5 billion data centre in North Sydney [12], Lipman has been appointed to a $64 million vertical high school project in Western Sydney [11] and construction has commenced on a 445-bed student accommodation facility for the University of Newcastle [4]. 

These projects signal continued investment in digital, social and educational infrastructure across the state.

Planning Reforms and Complex Disputes

The NSW government continues its implementation of planning reforms to address housing supply, while the industry simultaneously navigates legislative reviews and complex legal disputes. 

The Transport Oriented Development (TOD) Program, which commenced in mid-2024, is set to reshape regional markets like Newcastle and the Central Coast by relaxing zoning controls and increasing height and density allowances within 400 metres of key transport hubs [17]. 

This strategic push is mirrored by large-scale urban renewal projects, such as the proposed rezoning of 200 hectares at Port Kembla to create an "Enterprise Zone" for advanced manufacturing and clean energy, projected to create up to 30,000 jobs [1, 2]. 

Separately, in South West Sydney, progress on major road infrastructure is set to enable new housing supply in the Greater Macarthur Growth Area [23].

Meanwhile, a $91.7 million lawsuit has been launched by the developers of Sydney's Oxford & Foley project against a major builder, alleging significant delays and cost overruns leading to contract termination [20]. The builder has refuted the claims, alleging wrongful termination and filing a "proportionate liability" defence to involve subcontractors in the dispute. This case underscores the severe financial and reputational risks inherent in major construction contracts and the legal complexities of apportioning liability [20].

Takeaways

Navigating Planning and Community Opposition for Energy Projects

The legal challenges facing the Hills of Gold wind farm [6] and community friction in the Riverina [18] highlight key risks for developers of renewable energy projects. 

Securing state-level approval, such as through the State Significant Development (SSD) pathway under the Environmental Planning and Assessment Act 1979, is no longer a guarantee of smooth project progression. 

As demonstrated by the Tamworth Regional Council's appeal, project proponents must be prepared for legal challenges in the NSW Land and Environment Court even after obtaining consent. A robust legal strategy should anticipate such appeals from the outset. 

Furthermore, the call for stronger, mandated consultation processes suggests that the current "tick-box" approach is inadequate [18]. 

Proactively engaging with communities and local councils to establish fair compensation and benefit-sharing agreements, beyond minimum statutory requirements, is becoming a commercial and legal necessity to mitigate the risk of delays and reputational damage.

Contractual Risk Management: Termination and Proportionate Liability

The $91.7 million dispute between the Oxford & Foley developers and a major builder serves as a reminder of the legal risks in head contracts [20]. The allegations of wrongful termination underscore the need for accurately drafted contract clauses that clearly define default events, notice periods and the process for termination. 

Ambiguity can expose either party to significant damages claims. For builders, the developers' claim of "misleading and deceptive representations" highlights the importance of ensuring all pre-contractual statements and project forecasts are accurate and defensible. 

The builder’s use of a proportionate liability defence is a key legal strategy in NSW, aiming to apportion financial responsibility among multiple parties, including subcontractors, who may have contributed to the alleged defects or delays [20]. This places subcontractors on notice that they can be drawn into major legal disputes, making robust record-keeping and adherence to subcontract terms essential for defending their position.

Final Thoughts 

The NSW construction industry is at a pivotal juncture, balancing opportunity with risk. 

The state's ambitious clean energy and infrastructure agenda is creating a strong pipeline of work, from transformative grid-scale batteries to vital transport links [13, 14, 21]. 

However, this momentum is being tested by complex implementation challenges. The delays on the Sydney Metro extension and the legal battles facing renewable energy projects demonstrate that regulatory compliance and social license are as important as engineering capability [3, 6]. 

For developers, builders and contractors, the path forward requires more than just technical excellence. Success will depend on risk management, proactive community and regulatory engagement and the diligent administration of increasingly complex contracts to navigate a dynamic and demanding market.

1. Property Council of Australia. (5 September 2025). Port Kembla Transformation a Generational Opportunity for Illawarra. https://www.propertycouncil.com.au/media-releases/port-kembla-transformation-a-generational-opportunity-for-illawarra
2. The Urban Developer. (5 September 2025). Rezoning Plan for Port Kembla Supersite Revealed. https://www.theurbandeveloper.com/articles/bluescope-port-kembla-wollongong-rezoning-proposal-industrial
3. City Hub Sydney. (5 September 2025). Frustration As Sydney Metro Extension Hindered By Lack Of Fire Hydrants. https://cityhub.com.au/frustration-as-sydney-metro-extension-hindered-by-lack-of-fire-hydrants/
4. Newy 87.8 FM. (5 September 2025). Construction begins on University of Newcastle’s 445-bed City Campus student accommodation. https://newy.com.au/2025/09/05/construction-begins-on-university-of-newcastles-445-bed-city-campus-student-accommodation/
5. Blue Mountains Gazette. (5 September 2025). Macquarie electorate quick on the uptake, rating 10th best for batteries. https://www.bluemountainsgazette.com.au/story/9056558/macquarie-embraces-new-home-battery-program/
6. Renew Economy. (5 September 2025). Australian developer buys contested wind project, takes up fight against “questionable” legal challenge. https://reneweconomy.com.au/australian-developer-buys-contested-wind-project-takes-up-fight-against-questionable-legal-challenge/
7. Quarry. (5 September 2025). Holcim Australia supports major step in Sydney Metro project. https://www.quarrymagazine.com/holcim-australia-supports-major-step-in-sydney-metro-project/
8. Tom O'Keane. (September 5, 2025). Sydney Gateway: Precision precast powers a pivotal transport link. https://roadsonline.com.au/sydney-gateway-precision-precast-powers-a-pivotal-transport-link/
9. Process Technology. (5 September 2025). Solar and battery project completed at biscuit factory. https://www.processonline.com.au/content/business/news/solar-and-battery-project-completed-at-biscuit-factory-1050771146
10. Staff, Tumut and Adelong Times. (September 4, 2025). Camps to welcome workers as HumeLink construction to get underway. https://tatimes.com.au/camps-to-welcome-workers-as-humelink-construction-to-get-underway/
11. Projectory. (4 September 2025). Contractor appointed for $64m high school construction project in Western Sydney, with major building works set to start. https://www.projectory.com.au/article/contractor-appointed-for-64m-high-school-construction-project-in-western-sydney-with-major-building-works-set-to-start
12. Projectory. (4 September 2025). Early procurement underway for $1.5bn data centre project in northern Sydney, with major contractors and suppliers being sounded out. https://www.projectory.com.au/article/early-procurement-underway-for-15bn-data-centre-project-in-northern-sydney-with-major-contractors-and-suppliers-being-sounded-out
13. Share Cafe. (4 September 2025). Akaysha Energy Secures $300 Million Debt Facility. https://www.sharecafe.com.au/2025/09/04/akaysha-energy-secures-300-million-debt-facility/
14. NSW Government. (4 September 2025). New route to the Cahill Expressway opens to 10,000 cars daily as latest Warringah Freeway milestone passed. https://www.nsw.gov.au/ministerial-releases/new-route-to-cahill-expressway-opens-to-10000-cars-daily-as-latest-warringah-freeway-milestone-passed
15. TimeOut Sydney. (4 September 2025). A new 46-metre underpass opens tomorrow connecting to Sydney's City East. https://www.timeout.com/sydney/news/a-new-46-metre-underpass-opens-tomorrow-connecting-to-sydneys-city-east-090425
16. The Weekly Source. (8 September 2025). Aveo reveals plan for Manly Hospital site redevelopment. https://www.theweeklysource.com.au/community-living/aveo-reveals-plan-for-manly-hospital-site-redevelopment
17. COMMO. (8 September 2025). Transport Oriented Development set to reshape regional NSW property markets - Commercial Collective. https://www.commo.com.au/news/2025/09/08/transport-oriented-development-set-reshape-regional-nsw-property-markets-commercial
18. Region Riverina. (8 September 2025). Dr Joe calls for improved consultation and compensation in drive for renewable energy. https://regionriverina.com.au/dr-joe-calls-for-improved-consultation-and-compensation-in-drive-for-renewable-energy/104525/
19. Kiama Bugle. (8 September 2025). Kiama buzzing with energy after battery info sessions. https://thebuglenews.com.au/NewsStory/kiama-buzzing-with-energy-after-battery-info-sessions/68b7b0254315a7002eb3ddd5
20. The Australian. (7 September 2025). Oxford & Foley developers launch $92m suit against builder Growthbuilt over Sydney hub. https://www.theaustralian.com.au/business/property/commercial/oxford-foley-developers-launch-92m-suit-against-builder-growthbuilt-over-problemriddled-sydney-hub/news-story/26f6745d9224216f802483630925ae56?btr=ecd7bd594bec5e734e983b506641e0a1
21. Southern Highland News. (7 September 2025). Giant $150m battery at Unanderra would 'revolutionise' power delivery, company says. https://www.southernhighlandnews.com.au/story/9059218/150m-battery-project-to-boost-the-transition-to-renewable-energy/
22. Property Council of Australia. (10 September 2025). Submission – Proposed building reforms in NSW. https://www.propertycouncil.com.au/submissions/submission-proposed-building-reforms-in-nsw-2
23. Property Council of Australia. (5 September 2025). Step Forward for South West Sydney’s “Magnificent Seven” Roads. https://www.propertycouncil.com.au/media-releases/step-forward-for-south-west-sydneys-magnificent-seven-roads