The largest solar power project in the southern hemisphere will be constructed in NSW, with funding from the state and federal governments and energy company AGL.

AGL says it will construct a solar project at Nyngan, in the state's central west, and another at Broken Hill, in the far west, at a cost of around $450 million.

Almost $170 million will come from the federal government's Australian Renewable Energy Agency (ARENA), and the NSW government is contributing $65 million.

The 102 megawatt Nyngan plant will be the largest in the southern hemisphere, producing enough electricity to power 50,000 homes once completed in mid-2015.

The 53 megawatt Broken Hill plant will also be among the country's largest, and is expected to be commissioned in November 2015.

Work is expected to start on the Nyngan project in January 2014, creating about 300 jobs, while around 150 people will be employed on the Broken Hill project when construction starts in July 2014.

AGL managing director Michael Fraser said solar energy was a growing industry.

"Solar PV (photovoltaic) in Australia has come a long way from being a small-scale industry in a relatively short time frame," he said in a statement on Wednesday.

AGL has enlisted US solar giant First Solar to assist in the construction of both plants, and their management during the first five years of operation.