A keynote from The B Team's Keith Tuffley.

A lack of communication between solar and energy efficiency is holding back the true potential of emissions reduction in the built environment, Anna Skarbek, chief executive of ClimateWorks and CEFC board member, told delegates at the Australian Climate Leadership Summit 2015 today.

Speaking on a cities, infrastructure and technology panel, Ms Skarbek said a lack of collaboration by those selling energy efficiency projects was “a terrible inefficiency and lost opportunity”.

She said the Clean Energy Finance Corporation had put funding into environmental upgrade agreements.

“It’s a fantastic mechanism for derisking upgrades in the built environment,” she said.

“The challenge is not the mechanism, which is robust – it’s selling energy efficiency upgrades themselves.

“Energy efficiency is an outcome, it’s not a product that people want to buy. That has been the challenge. Salespeople are used to selling things you can see, not things you can avoid. This funding mechanism is expected to unleash the market, but the market itself has to learn to market differently.”

She noted that in Victoria the CEFC was getting better uptake of energy efficiency upgrades when done in collaboration with solar.

Ms Skarbek said: “The sales force can sell solar, and then say – by the way – here’s a great way to pay for it. By bundling energy efficiency projects together – a solar offering with a lighting upgrade, for example – we can be much more successful.

“I really encourage the industry to think hard wherever you can on how you can bundle energy efficiency upgrades into marketable opportunities and link into solar wherever possible. A million homes or more had people go onto their buildings to install solar panels, but very few actually had those people go inside and do the energy efficiency upgrade.

“Those two policy mechanisms are not talking to each other, and that’s a terrible inefficiency and lost opportunity that we will need to recover because we’ll need all those emission savings.”

The difficulty in selling a saving, rather than a product, was also touched on by Rod Naylor, executive director for growth at Veolia Australia, who said: “Not having a tangible product is a factor, but so is community attitude and sentiment for energy efficiency. So I think there is a role for local government to provide that community understanding to drive that appetite and create that demand.”

Local government role in low carbon economy

Adding to the role that local government can play in bringing about a low carbon economy, Ms Skarbek said that inspiring a greener built environment was important.

“A lot of the powers that relate to sustainability are very local – in particular the built environment, transport, infrastructure. What we should watch out for is that states in particular, and local councils, don’t underestimate the power they have to guide the national policy.

“Even though state and local government don’t hold all the planning powers, they do hold a lot of them, and can facilitate and excite by simply using that power in tendering for public buildings.”

She stated that by asking those submitting bids to tenders for public buildings to submit two plans – a bid for the most cost-effective building, and another for the most carbon neutral – councils could “energise the supply chain, give architects a chance to unleash their creativities, and discover that maybe [carbon neutral buildings] don’t cost as much as they thought”.

Creating local community appetite was also a crucial factor, she said.

“The best policies in the world can be easily repealed if there is not widespread community understanding, and that’s the advantage that local government has – it’s close to the community and [can] get them on-board with these issues.”

As well as the built environment, the summit took a look at what is being done in terms of renewable energy across Australia.

The Lord Mayor of the City of Sydney, Clover Moore, highlighted that the Sustainable Sydney 2030 strategy aims to make the city 100 per cent renewable energy powered by 2030, while Simon Clough, Deputy Mayor of Lismore City Council, revealed that it was working on “Farming the Sun”, Australia’s “first council-community solar energy partnership”. This will involve installing solar photovoltaic panels at the sewage treatment plant and at recreational facilities to “produce a few hundred kilowatts of power” and help the council be “totally off the grid by 2023”.

The event – Sydney’s lead-in event to the crucial United Nations Climate Conference in Paris next month, which will bring together heads of state from across the world to develop a universal climate agreement – also saw representatives from major businesses discuss what they are doing on sustainability.

Speakers included Mark Speakman, NSW Environment Minister; Trevor Clayton, chief executive of Nestlé Oceania; Andy Vesey, chief executive of AGL Energy; James Chin Moody, chief executive of both TuShare and Sendle; Dr Matthew Bell, climate change and sustainability services leader or Oceania at EY; and David Lietch, analyst at UBS.

The event also saw the presentation of the Compact of Mayors recognition ceremony and the CDP 2015 Australian Climate Leadership Awards.

2 replies on “Lack of bundling on energy efficiency projects “a lost opportunity””

  1. Yes, as someone working in energy efficiency/renewable energy space at a local government I can confirm that the challenge of selling energy efficiency takes a lot more effort than selling rooftop solar. I’d add that mandatory disclosure schemes are the missing link in making energy efficiency tangible, marketable, and front-of-mind for homeowners. By their nature, Councils will always do everything they can to drive positive outcomes for the their communities. But the speed with which they can drive large scale persistent change is inevitably constrained by the limited resources they have. On the other hand mandatory disclosure would turbo charge the efforts of all stakeholders involved in promoting/selling energy efficiency and provide a clear mechanism for households to understand the impact of their investment.

  2. Having sold energy efficiency for some time and collaborated with leading ESCOs, CW and the CEFC (then LCA) in the past, Anna is correct in suggesting bundling is an answer.

    Those who have been selling EE successfully know it’s about education, evidence and innovation in packaging the proposition.

    Factors have always historically conspired against EE’s appeal – low cost of energy, projects that generate Revenue vs projects that reduce Costs (sexiness factor), general capability to implement (through to M&V skills) etc still potentially exist for many (ie Wholesale energy rates for large customers are low).

    Bundling (EPC or smaller projects) has been the approach for selling commercial EE measures for some years now, along with retail on-bill payment plans and creative approaches to funding. Solar PV comes to play after you reduce baseline energy consumption and hence reduce the size of a PV system required – its a simple staged process for implementing continuous savings and benefits. It helps the cost of PV is now within commercial consideration for all (although the DB’s need to come to the party still).

    Many issues need to be addressed beyond the sales approach – the consistency of State Government Policy (ie pulling the EPC GGB program), smaller customer barriers (VEEC, ESC prices etc) and the attitude and engagement of overseas owners of low grade building stock. Many simply only spend the bare minimum maintaining their portfolio’s in seeking maximum capital gains, EUAs may help but it’s hard to engage people who do not have the sentiments we share locally.

    Just some insights from those doing the work on the ground…

Comments are closed.