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We support our member councils for a low carbon, resilient future

October 2017

 

 
Working to help councils deal with energy prices
Electric vehicle inquiry 
Climate change innovation grants
Community power hubs
Upcoming events - our AGM

Editorial

Turning council power bill shock into cost-saving low-carbon futures

 
In the next 12 months, all Victorian councils must commit to their next round of electricity contracts. Current market rates indicate that councils are in for significant price shock if they continue to purchase energy with a business-as-usual approach. This is partly because councils have been buffered from recent price increases by locking in low rates 2 years ago in a fixed rate, fixed term contract.

The CVGA in partnership with the other Victorian Greenhouse Alliances and Sustainability Victoria recently held a forum on large-scale renewables and council electricity procurement. The event provided councils with independent information to critically assess future options for electricity contracts. It also provided an opportunity to consider and understand the different models for purchasing or investing in large scale renewable energy.

The business case for renewables is stronger than ever

The forum heard that councils can expect significant price increases for large market sites and public lighting in the year ahead. For many councils this will be an unbudgeted price shock, and could translate into overall bill increases of somewhere between 30-60%. For instance if a council currently spends $1 million on electricity, it could expect to spend $1.5 million from next year.
The silver lining from this however is that the business case for renewable energy and energy efficiency will be significant improved. 

Ways to manage skyrocketing power prices

Investing in behind the meter renewable energy such as solar on council buildings is typically a ‘no-brainer’ and councils should seek to do this when and where they can. As a generalisation, the forum heard that behind the meter solar has an average simple payback period of 5.4 years for council buildings and leads to significant savings.

Similarly, undertaking energy efficiency can lead to further savings and typically most activities have simple payback periods of between 5-9 years.

However, Scott Mckenry (pictured below)  from the Eastern Alliance for Greenhouse Action explained that after pursuing all the cheaper behind- the-meter solar and energy efficiency opportunities councils are looking at energy savings of only 30%. In order to go the next step it is necessary to look at supply side options.


Scott Mckenry speaking at  Victorian Greenhouse Alliance forum on energy procurement

Exploring supply-side options

There are two main avenues to pursue with supply side options; directly investing and owning energy infrastructure offsite that sells into the electricity market, or taking on long term contracts through what is known as Power Purchase Agreements (PPAs). The most notable example of a council owning, operating large scale solar is the Sunshine Coast Council which has recently connected a 15MW solar farm costing the council $50 million. The project is expected to deliver $22 million savings over the next 25 years.

On the other side, a number of councils and other organisations have developed a consortium to buy green energy for the next 10 years through a retailer aligned Power Purchase Agreement. This group is known as the Melbourne Renewable Energy Project, and the cities of Melbourne, Port Phillip, Moreland and Yarra will soon be purchasing 100% renewable energy through this project.

CVGA help for councils

For councils, navigating through the emerging options can be overwhelming. However, determining which model is suitable for which council can be achieved by thinking strategically about what are the core policy objectives. Is it just about cost minimisation? Or is it important to also deliver emissions reductions, and local economic development? Understanding these preferences will help guide councils to make decisions on a model that best suits them.  

The Greenhouse Alliances are forming a working group of councils to continue to develop these options in the year ahead and start to aggregate councils who are wishing to pursue the owner/operator model versus the councils wishing to enter long term Power Purchase Agreements (PPAs).

For further information contact Rob Law, eo@cvga.org.au or to access the recent webinar click here.
 

Have your say on electric vehicles

– Parliamentary Inquiry

 
The State Government is conducting a Parliamentary Inquiry into electric vehicles, and is taking public submissions until 1 November. Many victorian councils are exploring ways to facilitate uptake of low emissions vehicles, such as through introducing electric vehicles, hybrids and plug-in hybrids in council fleets, and supporting their communities to invest in electric vehicles by installing publicly available charging infrastructure.

The CVGA is calling for a state based EV target in the range of 30% by 2030,  reflecting international goals in line with Paris emissions reduction targets.

EV policy reform needed
 
EVs are a key solution in decarbonising passenger transport; however in Australia there is limited model availability. Targeted policy support for EVs can unlock innovation and create new advanced industries that spur job growth and enhance economic prosperity.

Of the 4.7 million vehicles in Victoria, only 0.05% are electric as of February 2017 (based on data CVGA acquired from VicRoads). The mass uptake of EVs will require state government policy incentives and infrastructure investments to accelerate the transition in the short term.

Other policy options include offering discounts on registration and stamp duty, investing in EVs in government fleets to help drive the second hand car market, and working with industry and local government on rolling out visible EV  charging infrastructure.

Make a submission to the Parliamentary Inquiry, or contact Rob Law at eo@cvga.org.au for details on the CVGA submission.
 

Climate change innovation grants

 
Imagine a room brimming with a hundreds of climate change innovation ideas for regional Victoria, all being given a chance to become reality. 

At the climate change innovation market place events key advocates, community members and experts in sustainability, renewables and environment have been partnering to explore how  to make meaningful local change.  

The market place events held in September and October give participants a unique collaborative opportunity to meet potential project partners to bring to life their bold ideas for local climate change action.
 
The $3.8m Climate change innovation grants represent an important way for Victorian organisations to be local leaders and develop innovative solutions to climate change challenges.

The grants program is designed to:
  • foster action, innovation and collaboration between businesses, industry, researchers and government to reduce greenhouse gas emissions and adapt to climate change; and
  • drive greater investment into high impact innovations that provide solutions to challenges that inhibit the ability of our communities, environment and businesses to be prosperous in the face of climate change.
Market place events
Wednesday 18 October – Horsham
Wednesday 27 October – Melbourne CBD
Details
 
Grant deadline: 30 November, 2017

If you have a project that you are interested in partnering with the Central Victorian Greenhouse Alliance dont hesitate to get in touch with Rob Law, eo@cvga.org.au 

 

Councils supporting community energy


The CVGA is involved in two community power hubs in our region; Ballarat and Bendigo. Sustainability Victoria has appointed Bendigo Sustainability Group and the Ballarat Renewable Energy and Zero Emissions (BREAZE) to host the hubs.

CVGA EO Rob Law attended the inception meeting for the Bendigo power hub and was impressed with the fantastic enthusiasm and passion for progressing community owned renewable energy in Bendigo and surrounding areas and to keeping financial and other benefits local. The CVGA will work closely with the hubs to explore ways that councils can help to facilitate community energy through a range of different models. 

The Victorian Parliament recently published the results of its inquiry into community energy. The greenhouse alliances provided evidence to the inquiry of the benefits of community energy projects and the challenges they face.

Some of the notable recommendations of the committee were: 
  • include community part‑ownership as one of the evaluation criteria for the VRET reverse auction scheme with a weighting of at least 20%.
  • work towards regulatory changes that would encourage local energy trading/virtual net metering.
  • develop incentives for electricity distributors to reduce grid connection costs.
  • Councils that use rates-based financing for solar projects (e.g. the Solar Savers project) are essentially lending money to ratepayers for solar installations, so this adversely affects their debt ratio. This may deter Councils from this type of project. The committee recommended that the Local Government Act be amended to allow Councils to keep such debts “off balance sheet”.
CVGA is particularly glad to see this last recommendation in the report, as we have been strongly advocating to the Government on this issue. The full report is available to download from the Victorian Parliament website




 

Building better connections between local government and electricity networks


The CVGA is establishing a working group between its member councils and Powercor to improve collaboration and information sharing. The working group followed a recent Future Energy Planning project led by the Victorian Greenhouse Alliances. Building better links between the sectors will improve energy planning and new energy technologies integration. This collaboration aims to open up new opportunities for demand management.

Want to know more about demand management?
Read our article in Renew Economy 

Events

 

CVGA Annual general meeting

 
Thursday, November 16, 2017
10:00 AM – 1:00 PM
Reception Room, Bendigo Town Hall
189-193 Hargreaves St, Bendigo
 

 

 

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