Australian councils are being encouraged to invest in clean technologies to reduce energy bills and lower emissions by accessing a new $250 million program from the Clean Energy Finance Corporation (CEFC).
The CEFC Local Government Finance Program is designed to provide flexible and competitive fixed-rate, long-term finance tailored to the needs of Australian councils.
Australia has around 565 local councils, which spend more than $32 billion annually on housing and community amenities, as well as transport and communications infrastructure
The CEFC’s executive director of coporate and project finance, Paul McCartney, said there are compelling reasons for Australian councils to take proactive steps to manage their energy use.
“Australia-wide, councils are under continued pressure to effectively and efficiently manage their operations,” McCartney said.
“Local governments across Australia administer a vast network of street lights, community centres, libraries, sport and recreation facilities and other public access buildings.
“We see strong potential for operational savings through a range of renewable energy, energy efficiency and low emissions technologies. This program will provide councils with access to finance to help accelerate the adoption of these improvements.”
Key elements of the CEFC Local Government Finance Program include:
Finance for eligible projects across renewable energy, energy efficiency and low emissions technologies
Loans of at least $10 million for a single project or package of works
Finance can be drawn over three years
Ability for multiple councils to enter into joint financing agreements for eligible projects
Access to competitive fixed-rate longer-dated senior debt (up to 10 years)
A straightforward approval process with simple loan documentation.
“This program will support major investment activities across a range of eligible projects. For example, there are clear benefits to councils from converting street lighting to more efficient LED lighting, as well as installing rooftop solar PV on council-owned buildings," McCartney said.
“The CEFC has identified energy from waste projects as an area where councils can generate energy by reusing landfill waste. We’ll also be speaking with councils about improving airconditioning, installing smart controls and voltage optimisers to improve the energy efficiency and performance of their buildings.”
The new program builds on the CEFC’s strong experience working with local government, including a new $30 million program of clean energy initiatives to help the City of Melbourne reach its goal of zero net emissions by 2020.
McCartney said the CEFC’s financing solutions can help councils proactively manage these costs, whether through reducing energy consumption in high use areas such as leisure and aquatic centres or accessing fleet financing to enable the council’s conversion to electric vehicles.
“In a period of historically low interest rates, now is the time for councils to act to reduce energy costs and lock in the long term benefits of energy efficiency," he said.
“Because these investments lead to lower energy use, councils can reduce their ongoing operating costs. These savings may be sufficient for councils to repay the loan without impacting their net cash flows.”
The Institute of Public Works Engineering Australasia (IPWEA) estimates that switching to LED street lighting could save Australia’s local councils up to $87 million and prevent 720,000 tonnes of CO2 emissions from entering the atmosphere each year.