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1 November 2026

How to bid in a Capacity Investment Scheme tender: a practical guide

How Capacity Investment Scheme tenders work, what a CISA gives your project, how bids are scored and the mistakes that sink bids, with the latest tender rounds as at October 2026.

By Leigh Heaney, Watson Advisory

The Capacity Investment Scheme (CIS) is the Australian Government’s main tool for underwriting new wind, solar and battery projects. This guide explains how CIS tenders work, what the contract actually gives you, how bids are scored, and where bids most often go wrong.

It reflects the tender rules and results published as at October 2026, including the changes introduced from Tender 5 onwards.

Who this guide is for

  • Developers of utility-scale wind, solar, hybrid and battery projects in the National Electricity Market (NEM) or Western Australia’s Wholesale Electricity Market (WEM).
  • Investors and financiers who need to understand what a Capacity Investment Scheme Agreement (CISA) is worth to a project.
  • Boards and executives deciding whether a project is ready to bid in the next round.

What the Capacity Investment Scheme is

The CIS is a revenue underwriting scheme run by the Department of Climate Change, Energy, the Environment and Water (DCCEEW). It does not hand out grants. Instead, it gives successful projects a long-term revenue safety net, which lowers financing risk and helps projects reach financial close.

On 29 July 2025 the scheme’s target was lifted to 40 GW of new capacity by 2030: 26 GW of renewable generation and 14 GW of clean dispatchable capacity such as batteries. Tenders are held in both the NEM and the WEM, and DCCEEW says auctions will run from 2024 to 2027.

There are two types of tender: generation (wind, solar and other renewables, including hybrids) and dispatchable (storage). AusEnergy Services Limited (ASL, formerly AEMO Services) runs the tender process with AEMO and recommends bids to the Australian Government. The Minister for Climate Change and Energy makes the final decision.

What a CISA gives you

A CISA is a contract between your project company and the Commonwealth. For the NEM generation CISA offered in Tender 9, if the project’s revenue:

  • falls below an agreed Annual Floor, the Government tops up 90% of the gap; and
  • exceeds an agreed Annual Ceiling, the project pays 50% of the excess to the Government.

Both payments are limited by an Annual Payment Cap. The floor and ceiling are expressed in dollars per MWh of generation, and you bid them, along with the payment cap. The support period runs for a maximum of 15 years. The Tender 10 (NEM dispatchable) and Tender 11 (WEM generation) guidelines use the same 90% and 50% shares. Tender 11 also sets the floor and ceiling in dollars per MWh of generation, while Tender 10 sets them in dollars a year. Terms can change between rounds, so read the pro forma CISA for the tender you are bidding into.

Two practical points matter for your financial model. First, a project must be operating and earning revenue before underwriting payments start. Second, DCCEEW has confirmed that no executed CISA has ever underwritten revenue lost to curtailment. Revenue from eligible offtake contracts counts towards the project’s revenue under the CISA, and you must notify the Department of every wholesale contract you sign. (Watson Advisory can help you manage your contract notifications to the department: admin@watsonadvisory.com.au)

Where the scheme is up to

Eight CIS tenders have been decided, plus an earlier pilot tender in South Australia and Victoria. The two most recent NEM rounds were large and heavily oversubscribed:

  • Tender 7 (NEM generation): target 5 GW, 53 bids for 18.6 GW, 19 projects awarded totalling 7.8 GW (announced May 2026).
  • Tender 8 (NEM dispatchable): target 4 GW / 16 GWh, 73 bids for 76.4 GWh, 15 projects awarded totalling 4.2 GW / 16.1 GWh (announced June 2026).

Three more tenders have closed and are being assessed:

  • Tender 9 (NEM generation, 5 GW): bids closed 20 July 2026; results expected November 2026.
  • Tender 10 (NEM dispatchable, 16 GWh): bids closed 18 August 2026; results expected in early 2027. DCCEEW says this is likely to be the last dispatchable tender, provided the remaining targets are met.
  • Tender 11 (WEM generation, 1.8 GW): bids closed at 5pm AWST on 22 October 2026; results expected March 2027. It is likely to be the final CIS tender in the WEM.

DCCEEW’s indicative schedule, last updated 24 June 2026, also lists a Tender 12 (NEM generation) opening around November 2026, and a Tender 13 (NEM dispatchable) only if Tender 10 does not meet the remaining target. ASL had not listed Tender 12 on its tenders page as at 1 November 2026, so check there for confirmed dates. With the scheme due to finish tendering in 2027, the remaining rounds are your last chances to bid.

Eligibility

Each tender has its own eligibility criteria, set out in the Tender Guidelines. Using Tender 9 (NEM generation) as the most recent example, the key tests were:

  • Who can bid: an entity with an ABN that is an Australian company, a Commonwealth entity, a state or territory owned corporation, or a local government body. The contracting party must be a special purpose vehicle that holds the project’s assets and carries on only that project.
  • Size and technology: at least 30 MW of registered capacity, using an eligible renewable source that can create large-scale generation certificates. Virtual power plants and native forest wood waste were excluded.
  • New capacity: the project must not have been listed as committed or existing in AEMO’s April 2025 Generation Information page.
  • Grid connection: at least a network service provider’s response to a connection enquiry (or an executed connection agreement).
  • Planning: the project must be “suitably progressed” in the relevant state planning process, using state-specific tests set out in the guidelines.
  • No double dipping: projects with a long-term government revenue underwriting agreement covering 50% or more of their capacity were ineligible.
  • Location: NSW projects were excluded from Tender 9 because the NSW allocation under its Renewable Energy Transformation Agreement had been filled. Tender 9 also set minimum allocations for Victoria (1.6 GW) and Tasmania (0.3 GW) and capped Victorian solar-only projects at 0.47 GW.

Two newer requirements are worth flagging early. From Tender 11, bidders must have started an assessment under the Developer Rating Scheme, run independently by Equifax, and the Government has said this will be a prerequisite for CIS tenders going forward. And from Tender 9, a First Nations Equity and Revenue Sharing Set Aside reserves part of each target (500 MW in Tender 9, 180 MW in Tender 11) for projects committing to at least 5% First Nations equity, equivalent revenue sharing, or a combination.

How bids are scored

Since Tenders 5 and 6, CIS tenders use a single-stage process with five merit criteria. Tender 9 weighted them as follows:

  • MC1, financial value, system reliability and system benefits: 35%
  • MC2, project deliverability and timeline: 20%
  • MC3, organisational, resource and financing capability: 20%
  • MC4, First Nations participation and benefits sharing: 12.5%
  • MC5, social outcomes and community benefit sharing: 12.5%

Weightings can differ between rounds: Tender 10 (NEM dispatchable) put 50% on MC1 and 12.5% on each of the others, while Tender 11 (WEM generation) matched Tender 9. A quarter of the score sat with First Nations and community commitments in all three, and those commitments become binding contract terms if you win. Deliverability also carries real weight: projects should show a credible path to commercial operations before 31 December 2030, and earlier credible dates score higher. Commercial departures from the pro forma CISA are no longer scored and should be limited to what is strictly necessary for the project.

Step-by-step: preparing a CIS bid

  1. Check the round fits your project. Confirm the market (NEM or WEM), technology type, jurisdiction allocations and any exclusions in the market brief and Tender Guidelines. A strong project in the wrong round is a wasted bid.
  2. Get the eligibility evidence in hand before the round opens. Connection enquiry response, planning status, land arrangements and the SPV structure take months, not weeks. Start your Developer Rating Scheme assessment well ahead of time.
  3. Register on time. Registration is essential to bid and closes before bids do (in Tender 9, two weeks before).
  4. Build your bid variables from your financing case. The guidelines ask you to bid an Annual Floor, Annual Ceiling and Annual Payment Cap that are competitive but still sufficient to reach financial close. Test them with your lenders.
  5. Write a deliverability case backed by evidence. MC2 is assessed against milestones and industry benchmarks. Show your connection, planning, procurement and construction pathway with dates you can defend.
  6. Design First Nations and community commitments you can deliver. Work with Traditional Owners and the local community early. Decide whether to nominate for the First Nations Set Aside, and make sure any equity or revenue sharing arrangement is real and documented.
  7. Review the pro forma CISA with your lawyers. Only propose departures that are strictly necessary. Departures that shift risk or cost to the Commonwealth can see a bid removed.
  8. Use the Q&A process. Clarification questions go through the tender’s online portal and close before bids do. Published answers apply to everyone, so read them all.
  9. Submit and stay available. ASL and AEMO assess eligibility and merit and run due diligence. Be ready to respond quickly to information requests. (We can help you prepare for ASL’s information requests: admin@watsonadvisory.com.au)
  10. If successful, execute fast and report. CISAs must be signed within a time limit set for each round. After signing, you report against milestones (land, approvals, connection offer, financial close, construction) through the CISA Management Portal, and you must publicly report key workforce arrangements.

Timelines

The single-stage process gives bidders about eight weeks to prepare and submit a bid, and DCCEEW expects a tender to run for around six months from opening to announcement. Tender 9 is a typical example: it opened on 25 May 2026, registration closed on 6 July, bids closed on 20 July, and results are expected in November 2026.

Eight weeks is not enough time to build a project’s eligibility evidence from scratch. In practice, the work that wins a CIS bid happens in the six to twelve months before a round opens.

After award, every CISA includes a sunset date for commercial operations. It can be extended for force majeure events such as unexpected transmission delays, but if a project misses it, the Government has the option to terminate. Unsuccessful bids may be placed on a reserve list for a set period and offered a CISA if a selected project does not proceed.

Common mistakes

  • Bidding too low to be financeable. Winning with a floor your lenders will not accept is worse than losing. The guidelines explicitly ask for bids sufficient to reach financial close.
  • Optimistic delivery dates. Assessors compare your milestones against industry norms. An early date without a credible plan scores worse than a realistic one, and the sunset date makes it a contractual risk.
  • Treating social licence as a tick-box. MC4 and MC5 together carried 25% of the Tender 9 score, and every commitment is enforceable under the CISA. Generic promises score poorly and create compliance problems later.
  • Heavy mark-ups to the CISA. Since Tender 5, departures are not scored and risk exclusion.
  • Missing the eligibility basics. No connection enquiry response, planning not far enough advanced, or the wrong bidding entity. These bids are not assessed at all.
  • Leaving the Developer Rating Scheme too late. It is now a prerequisite, and the assessment covers seven criteria including community, conduct and capital.

FAQ

Is a CISA a grant?

No. It is revenue underwriting. The Government pays only if your revenue falls below the agreed floor, and you share revenue above the agreed ceiling. If market revenues land between the two, no money changes hands.

Can a NSW project bid into the CIS?

Not for NEM generation at present. Tender 9 excluded NSW projects because the NSW generation allocation had been met. NSW generation and storage projects should look at the NSW Roadmap tenders for long-term energy service agreements (LTESAs) instead.

Does the CISA cover curtailment?

No. DCCEEW has stated that revenue underwriting for curtailment has never been included in an executed CISA. Model curtailment risk as you would without the CISA.

Can I still sign offtake agreements?

Yes. The CIS is designed to sit alongside power purchase agreements, swaps and tolling agreements. Revenue from eligible contracts counts in the CISA calculation, but contracts must be at arm’s length, and you must notify DCCEEW of every wholesale contract.

What happens if my project is delayed after I win?

You must tell the Government if delivery dates change. The CISA’s sunset date can be extended for force majeure, such as an unanticipated network delay, but otherwise the Government may terminate if commercial operations are not reached in time. (Watson Advisory can help you brief the department on a delay: admin@watsonadvisory.com.au)

How many more CIS tenders are there?

Not many. DCCEEW’s indicative schedule runs to 2027, Tender 10 is likely the last dispatchable round, and Tender 11 is likely the last WEM round. Check the ASL tenders page for the next NEM generation round.

How Watson Advisory can help

We help developers test project readiness before a round opens, shape First Nations and community commitments that are credible and deliverable, and prepare the narrative and evidence for deliverability and capability criteria. Contact us at admin@watsonadvisory.com.au.

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About the author: Leigh Heaney is a Partner at Watson Advisory, specialising in government relations and public affairs. Leigh spent more than a decade as chief of staff to a senior federal frontbencher in both the House of Representatives and the Senate. Before joining Watson Advisory, Leigh was Government Relations director at Australia’s renewable energy peak body, working on the Capacity Investment Scheme and the production tax credits in the Future Made in Australia package.

This guide is general information only, current as at 22 October 2026. It is not legal, financial or tax advice. Program guidelines, eligibility and funding rounds change often, so check the official guidelines before applying, or contact Watson Advisory for advice on your circumstances.

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