Gas grant win for Victorian businesses
Sustainability Victoria (SV) has announced a much needed boost for businesses in the fight against the rising cost of gas.
The state government body will provide matched funding to businesses that spend up to $50,000 on their annual gas bill.
The announcement comes on the back of a sustained increase in energy costs, with some businesses seeing their bills double in just a year.
SV’s Director of Built Environment, Warren Overton indicated that any business that spent at least $20,000 on its annual bill was eligible for the program.
“The grants will improve energy productivity and affordability, support jobs, and reduce greenhouse gas emissions,” he said.
“Businesses that would benefit most are those which use gas for the creation of steam, hot water and process-heating.”
Overton also touched on SV’s Better Commercial Buildings Program, which offers matched funding of up to $30,000 on gas costs to owners of commercial buildings (such as offices, hotels and retail centres).
“In a pilot involving premises built between 1960 and 2000 — a group representing some 70 per cent of all commercial buildings in Victoria — energy bills were cut by 29 per cent on average and the payback period was just three years.
“In anyone’s book, that’s a good return on investment,” Overton said.
Both programs will enjoy increased effectiveness after Prime Minister Malcom Turnbull met with Santos, Shell and Origin in September, to discuss stabilising the country’s burgeoning gas crisis.
“[The companies] have given us a guarantee that they will offer to the domestic market the gas that was identified as the expected demand shortfall by the Australian Energy Market Operator in 2018,” Turnbull said.
The government will cap gas exports if the companies renege on the agreement.
The National Energy Guarantee
Despite the recent win against gas exporters, there is still widespread concern around the state of power supply and cost in Australia.
The longer term goal of Australia converting to renewable energy sources dominated headlines last week, after Turnbull revealed the National Energy Guarantee (NEG) in favour of the Clean Energy Target (CET).
Acting upon the recommendation of the Energy Security Board, the Coalition outlined its plan to reduce yearly power bills and increase energy reliability for Australians.
The NEG will require energy retailers to purchase power from alternative sources to guarantee supply during peak periods, and is projected to cut annual power bills by up to $120.
While the guarantee prioritises reliable energy over renewable energy, the ambiguity around alternative source purchases has remained a concern in Parliament, with fears that these measures could extend our reliance on coal. For that reason alone bipartisan support will be a hard sell.
Origin Energy chief executive Frank Calabria claimed that the NEG had “potential” , as other key industry players indicated that the guarantee may be a step in the right direction to addressing Australia’s energy woes.
“When you look at what it does, it guarantees you have reliability,” Energy Australia’s Mark Collette said.
“It doesn’t guarantee coal, gas or batteries — what it says is that, as a retailer, go and find enough dispatchable power to meet reliability standards.”
S3 Consortium Pty Ltd (CAR No.433913) is a corporate authorised representative of Longhou Capital Markets Pty Ltd (AFSL No. 292464). The information contained in this article is general information only. Any advice is general advice only. Neither your personal objectives, financial situation nor needs have been taken into consideration. Accordingly you should consider how appropriate the advice (if any) is to those objectives, financial situation and needs, before acting on the advice.
Conflict of Interest Notice
S3 Consortium Pty Ltd does and seeks to do business with companies featured in its articles. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this article. Investors should consider this article as only a single factor in making any investment decision. The publishers of this article also wish to disclose that they may hold this stock in their portfolios and that any decision to purchase this stock should be done so after the purchaser has made their own inquires as to the validity of any information in this article.
The information contained in this article is current at the finalised date. The information contained in this article is based on sources reasonably considered to be reliable by S3 Consortium Pty Ltd, and available in the public domain. No “insider information” is ever sourced, disclosed or used by S3 Consortium.