While Canberra dismisses the flashing sirens delivered by the Intergovernmental Panel on Climate Change this week, the rest of the nation – including businesses, local government and retail investors – are stepping up to the challenge with a range of programs to reduce greenhouse gas emissions on their own accord.
This week 20 members of the Business Council Australia’s climate change committee that included some of the biggest energy companies and corporates signalled they were quietly considering a “self-regulated package” of mechanisms to reduce emissions.
In a separate move a group of 70 local councils also flagged commitment to around 70 initiatives to reduce emissions and progress climate change action, another 35 councils entered power purchase agreements for renewable energy, and there’s a growing number of power purchase agreements signed by corporates outside of the BCA committee.
This package being considered inside the BCA is reportedly very much in its infancy and is still being discussed by members – Origin, Siemens, BHP, Ausgrid, Snowy Hydro, and Shell Australia, among others big players – behind closed doors.
On Thursday, both the BCA and committee members were tight-lipped on the subject that emerged for discussion at an energy event held by The Australian Financial Review, with the business council declining to comment when contacted by The Fifth Estate.
The focus of the industry-directed measures is on providing guidance for corporates looking to upgrade assets or build new ones. The plans will not involve carbon trading or a cap and trade mechanism.
Origin chief executive officer Frank Calabria was supportive of a collaborative approach to reforming the energy sector in his speech at Wednesday’s event, and believes companies such as Origin have a key role to play in this transition. However, it’s unclear if the energy company backs the notion of industry-directed mechanisms to guide climate change action.
“…why all this angst over policy if the investment will happen anyway?” Mr Calabria said.
“The challenge is an orderly transition – firming the influx of renewable energy into the grid and ensuring that customers are not exposed to further reliability or price shocks.
“We’ve seen the consequences when you let one of the objectives of energy policy get out of balance with the other three. I’m of course referring to reliability, security, affordability and sustainability,” he said.
Mr Calabria also said that the government expects the industry to take the lead on this issue.
“The government has been clear that the industry needs to stop waiting for policy certainty and just get on with the job of providing more affordable and reliable energy,” he said.
The big end of town is not alone.
Councils leading with the power of the people
Councils are also banding together to “outstrip” the federal government on climate change action. Just this week, the Cities Power Partnership released a report detailing more than 300 climate and energy pledges made by 70 councils.
“At the federal level, climate action continues to stall. Under current policy settings, Australia will not meet its 26-28 per cent emissions reduction target,” the CPP report said.
“Despite this, towns, shires and cities across the country are tackling climate change by driving down greenhouse gas pollution.”
The pledges include city-wide emissions and renewable energy targets. Many councils are also committing to sustainable transport options and the accelerated uptake of electric vehicles by pledging to install charging stations and other infrastructure.
Councils are also getting in on the Power Purchase Agreement (PPA) action. Earlier this month, 18 NSW councils signed a “landmark” agreement to have 35 per cent of their retail energy supplied by a renewable energy generator from 1 July 2019.
In what the Southern Sydney Regional Organisation of Councils (SSROC) claims is a NSW first, participating councils are set to receive 39GWh per year from the Moree Solar Farm project until the end of 2030 through the new agreement.
“This is a new and exciting model for electricity supply and a prime example of what councils can achieve when we work together. SSROC is proud to have led the charge towards securing a more sustainable future for councils through this approach to buying renewable energy,” SSROC general manager, Namoi Dougall, said.
Power purchase agreements
There’s also increasingly good news from other parts of the corporate sector with a growing number of companies signing onto PPA’s to buy power direct from renewable generators or retailers, as we found recently.
- • See this article in The Fifth Estate, PPAs drive where policy fails to steer – how corporates are driving renewables in Oz
PPA’s are attractive to businesses for a range of reasons, including corporate social responsibility, the marketing edge gained through carbon neutrality targets, and cheaper electricity.
Big names signing up include Telstra, Carlton United Breweries, UNSW, Monash and BlueScope.
Tim Buckley, director of energy finance studies, Institute for Energy Economics and Financial Analysis, said that while it is not an optimal, easy or cheap solution, it is an “acceptable one” in terms of the current federal policy void.
Retail investors are jumping into renewables
Mum and dad investors are also getting in on the action. NSW Green Globes award winner, ClearSky Solar Investments, told The Fifth Estate this week that it’s overwhelmed by interest in its renewables projects, and is struggling to keep up with demand.