City of Melbourne looks to buy renewables direct from market

The City of Melbourne is testing out a new approach to attract competitively priced renewable energy proposals, as part of the municipality’s efforts to meet its dual goals of 25 per cent renewable electricity by 2018, and zero net emissions by 2020.

Along with other large energy users, including like-minded local governments and businesses, the City of Melbourne has launched a Request for Information Process, with the aim of “challenging the market” to supply the right energy solutions at the right price.

The idea, says Melbourne Lord Mayor Robert Doyle, is “to combine our purchasing power and signal our interest in securing a competitive price for a long term electricity supply from renewable sources.

“We hope this scale of demand will stimulate investment in a new renewable energy project that is shovel-ready and has planning approvals in place,” said Doyle.

The group – which includes the Cities of Maribyrnong and Yarra, Federation Square, NEXTDC, Mirvac and bankmecu – has a collective energy consumption of around 100GWh worth of energy, which under current market conditions is equivalent to around 250,000 solar panels or 15 wind turbines.

Melbourne already has a decent track record of installing and supporting solar. In April this year, the City launched an incentive program called Smart Blocks, to encourage the installation of solar power on apartment buildings.

The program – round one of which closes on December 31 – offers rebates of up to 50 per cent of the project cost (maximum value $3,000) to residential strata buildings in the City to install solar electricity systems, and to upgrade shared lighting to more energy efficient technology.

But the Chair of Melbourne City Council’s Environment Portfolio, Councillor Arron Wood, said achieving the City’s “ambitious” renewables target would require substantial structural, economic and policy changes, and could not be achieved through council actions alone.

“We can’t currently access the level of renewable energy we require from within the municipality of Melbourne,” Cr Wood said.

“What we are proposing is a new model for securing renewable energy. If it works we would encourage other organisations to adopt a similar model.”

An evaluation process will begin in 2015 to determine the overall viability of the model and whether to proceed to a full tender process.