CEO’s Update

Perhaps one of the most interesting comments I have heard over the last couple of months was from a solar project developer who said, “What we need is a big bag of money available at cheap rates and over a long term that will unlock investment into commercial scale solar”.  To which I replied, “Have you ever heard of an EUA?” 

Since then I have met with over 15 solar project developers and product suppliers and numerous solar projects, all of whom are now looking in the Municipality of Melbourne for commercial scale solar opportunities.

Momentum is building into the expansion of the EUA marketplace across Australia.  I was fortunate enough to present to 70 of Queensland’s business leaders about the opportunity offered by EUA’s.  In NSW, SMF participated in that states review of the EUA program, with an exciting pipeline of opportunities evolving in those councils currently offering EUAs.

I presented to the Local Government association of South Australia information session for councils and SMF provided feedback on the draft South Australian Building Upgrade Agreements (BUA) legislation which takes the best from the existing EUA legislation from NSW and Victoria.  The Victorian government has confirmed its intentions to implement the visions of implementing the Plan Melbourne, Metropolitan Planning Strategy, which include the expansion of EUAs across that state too.

Bigger marketplaces encourage competition and innovation, from financiers, service and product providers as well as building owners and their tenants. The summary report released by the Eastern and Western Alliance for Greenhouse Action was released and projected that EUAs could unlock up to $4.5 billion and promises to generate 18,000 new jobs within Victoria.  Investment of this nature helps to prevent capital leakage from the state, locking investment directly into local communities, while delivering direct commercial and productivity gains to businesses that undertake these types of investments.  With a bigger market place for EUA’s, the potential scale of the opportunity has a chance of being unlocked.

Financiers too, recommitted to the EUA model.  The Clean Energy Finance Corporation (CEFC) announced it will provide finance of up to $30 million for Environmental Upgrade Agreements (EUAs) which will be available through NAB and Eureka Funds Management, bringing the total to up to a joint amount of $80 million allocated for EUAs.  With additional lenders, bankMECU and ANZ, also offering finance to EUAs, building owners can benefit from competition for their projects.

Participating and presenting at numerous events, SMF introduced the opportunity of EUAs to over 100 building owners and their tenants.  At the 2EXP Forum, to investigate strategies to double Australia’s energy productivity by 2030, SMF outlined how EUAs can unlock the capital required to reach this ambition.  SMF provided feedback to the federal government’s consultation on the Green Paper for the Emissions Reduction Fund outlining how EUAs can assist the ERF in accessing the capital required to capture the abatement opportunities presented by energy productivity gains.

We look forward to hearing your news and comments through our new website we have just launched, which also outlines our offering to local governments to assist them in establishing and running cost effective EUA programs.

Scott Bocskay