Cheap green loans from Sustainable Australia Fund are changing the way businesses see solar

Extract from ABC News

By business reporter Daniel Ziffer

Posted about 2 hours ago

Photo: Twenty per cent of Australia's solar power capacity was added in 2018 alone. (Pexels: public domain)

Soaring power prices have driven the rocketing rate of solar panel installations on household roofs across Australia.

But the long time it would take to pay off the installation, and receive the benefits, has discouraged many businesses from investing.
A new scheme is attempting to overcome that hurdle.
"In the last few years we've seen the average size of solar projects double in the markets of commercial property, manufacturing and agriculture property," said Anna Skarbek, chief executive of think-tank ClimateWorks.
"That's thanks to the falling costs of solar and the need of businesses to see energy prices come down. And they know that they can with this technology".
Australia's recent take-up of solar power is astonishing. By the end of last year, over 2 million small solar PV generation units were installed across Australia.
When it comes to the power they generate, around 20 per cent of the capacity was added in 2018 alone.
But business has been slower to adopt the technology, with the high set-up cost meaning the return on investment (getting your money back) takes much longer.

Soaring power prices

Renewable power expert Tristan Edis said the people "in the trenches" of making decisions — site supervisors and energy managers at large corporations — admit they have struggled to get the attention of senior managers for projects that would not pay themselves off for five or 10 years.
The fact they would go on to save or even make money did not seem to have helped.
However, a power price spike that has seen prices rocket 130 per cent since 2015 is now changing attitudes.
"Suddenly, senior management is interested and says, 'Oh, I'm reading in the newspaper on the front page every day … what can we do about this?'" Mr Edis told The Business program.

Photo: Green Energy Markets' Tristan Edis says rising power prices are driving management approval of renewable investment. (Supplied: Green Energy Markets)

Mr Edis, an analyst and director at the advisory firm Green Energy Markets, said site supervisors were whipping out renewable energy and energy efficiency plans they have had ready to go for years.
"Now they can finally get their projects up," he said.

"They were sensible investments … several years ago, but now they finally have got senior management attention to implement them."

'Every dollar counts'

At Paringa Estate winery on Victoria's Mornington Peninsula, winemaker Lindsay McCall observed the increasing cost of his electricity bill — particularly over summer when the winery requires more refrigeration.
"It's just a steady rising cost that is, I guess, hidden," Mr McCall said.
"Where you just pay the bills and don't worry about it because, you know, there's not a great alternative really," he said. "It's certainly not breaking our business but it's … every dollar counts really."
His electrician suggested paying for the installation of solar panels using the Sustainable Australia Fund.

Photo: Paringa Estate is one business that has taken advantage of a Sustainable Australia Fund loan. (Supplied: Paringa Estate)

An expansion of a successful City of Melbourne project, the $200 million fund is backed by customer-owned institution Bank Australia.
It lends money for renewable technology, which customers pay back — via their council rates — over a period of 20 years.
Businesses avoid the upfront sting of hefty installation costs and the bank secures a long-term loan.
Mr McCall said the nearby general store and pub had also taken advantage of the scheme.

Lost decade

Ms Skarbek said the "turbulence" of the political environment around climate change policy — which has contributed to the demise of prime ministers and opposition leaders — had also contributed to the rocketing prices and the boom in renewable energy.
"There's now been a lot of progress on the technological front and a strong sense of progress in terms of consumers shifting," she said.
Ms Skarbek, a board member of the Sustainable Australia Fund, said the "lost decade" had slowed down things that took businesses a long time: building infrastructure, developing skills and planning future developments.
For business, it is about a lot more than just where the power comes from.
"The science requires that the whole world reaches a carbon neutral or net zero emissions position by the middle of the century at the latest," Ms Skarbek said.
"So that means that all their buildings need to operate with zero emissions from their energy, as do our farms, manufacturing businesses and large industries … so this work will be needed urgently for this decade and next."

Photo: Father and son winemakers Lindsay and Jamie McCall are encouraging their neighbours to take advantage of cheap business loans for solar panels. (Supplied: Paringa Estate/Instagram)

At the winery, climate change has already dragged harvest dates a month earlier than they were 20 years ago, as hotter summers do their work on the grapes.
"I'm considering probably putting more panels on here," Mr McCall said.
"And I've spoken to other winery owners in this area and explained how we've done it and encouraged them. I think it's the way to go and the quicker Australia adopts more and more of natural energy, whether it be wind or solar, the better."