A $2 million project to install 3600 solar panels on an almost 25-hectare site on Boothenba Road has an estimated start up for the 2014/15 financial year.
In early September Red Sky Energy Limited's managing director Rohan Gillespie was on hand to launch two, five kilowatt solar panels on the site and said since the launch the company has realised the potential the panels offer to generate income.
He said the $2m estimated cost of the first phase of the Dubbo Solar One project would take about five months to construct and it was expected to begin operation shortly after and be cash flow positive.
He said the company was working towards raising the funds "in the next few months to get the installation under way". In a release to the Australian Stock Exchange, Mr Gillespie said the company had a feasibility study demonstrating enhanced investment returns from selling electricity on a spot basis.
Mr Gillespie said the federal government had made it clear it was going to close down all solar power incentive schemes.
He said the results indicate the Dubbo Solar One Project makes acceptable investment returns even in the scenario where the carbon tax and 20 per cent renewables scheme is cancelled.
In the report released by Red Sky to the ASX analysis of historical data showed solar projects could achieve significant time-of-day premiums to the average electricity price he said.
The Boothenba Road site has been leased from the Dubbo City Council by Red Sky for 30 years, with the construction of the first two 5kW photo voltaic Soleir systems completed. A high capacity transmission line about 150 metres from the site would serve to carry power generated by the panels into the grid and could generate enough electricity for an estimated 2500 homes.