Monday, May 25, 2015
RePower Shoalhaven: People Power at Work
We have come down to Shoalhaven to find out a little more about the RePower Shoalhaven Projects. RePower Shoalhaven is a not for profit organisation formed in 2013 to develop community solar projects for small business and the community to collaborate in. Very simply, the community invests in a project, a business supplies their roof for installation of the solar and signs a contract to purchase the energy from the project for a period of time, say 10 years. During the course of the project, the investors will get their capital paid back with interests, and at the end of contract the business will inherit the infrastructure. Community solar projects are taking off around the world and Australia
We learn that $120,000 was raised from the community and investors for the installation of this 99KW system in a period of 10 days with half the investors coming from outside of the Shoalhaven area. They plan to roll out the model on many more local buildings in the future but what they have realised is that this model can be used to fund anything in the local area via this investment process.
It is a win-win solution for all participants. For the business, there are no upfront costs, there are savings in their power bill, the community association will maintain the system and there is social capital to be gained by this collaboration. For the community, it gives them a great option to be actively involved in the fight again global warming, it ensures their money stays local, enhances local employment and results in a feel good project all round.
The system was installed in Aug 2014 with 80% of the funding coming from the community and the club chipping in with 20%. The estimated savings to the club is approximately $400,000 during the lifetime of the panels with an estimated investor return of 7.8%, a much higher return than is currently available from banks.
Here we see a business model that has financial, social and environmental benefits. The club were obviously attracted to the debt-free financing solution and it is a great example for other businesses to follow. During our time there, we met with a council representative to discuss more detail about the project. We learnt that RePower Shoalhaven have approached Council with a proposal to collaborate on a similar project but unfortunately, it is not a simple solution when it comes to a big consumer of power such as Shoalhaven Council. They already purchase cheap energy through bulk State Electricity Contracts, so would have to sign up for paying a higher price for solar energy. The roof of
the Council building is also reaching its use-by-date and hence putting expensive infrastructure on the roof is not a viable option.
What we hadn’t realised was also the fact there was a risk the panels could be subject to vandalism so protecting this valuable asset would be challenging. Council is currently capturing its gas from landfill and they intend to look at the possibility of converting this to electricity in the future. So, while the model might not be the most viable solution for Shoalhaven Council there are many other businesses for whom this would be an ideal solution.
It was inspiring to once again be in a community that is actively working toward a renewable future. People power at work in another part of Australia, doing its part in the renewable revolution.