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LGP’s Breakthrough Renewable PPA

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LGP’s Breakthrough Renewable PPA

LGP prides itself in working with NSW councils, putting community first, to deliver significant value.

Climate change has gravely impacted our communities, and today, local councils are being affected by one of the worst floods in recorded history. Over the last couple of years, the effect of extreme climatic changes has resulted in catastrophic bushfires and floods.

Building significant resilience into the State of NSW, our community and councils who have led the “green recovery.” LGP has supported this effort by negotiating market-leading contracts, helping councils transition to 100% renewable energy and net zero emissions.

In 2021, partnering with Blacktown Council and Western Sydney Regional Organisation of Councils (WSROC), LGP successfully facilitated the ‘Renewable Power Purchase Agreement’ (Renewable PPA) for 12 pioneering councils of NSW. Moving towards net zero and supporting the green recovery, this showcases a strong commitment by councils to make a difference to their communities. Together, along with these forward-looking councils, LGP has worked to procure 100% renewable energy for all their operated sites.

Following this success story, this year, an additional 22 councils have now signed up to replicate these results for their local communities.

What is so special about LGP’s Renewable PPA?

This Renewable PPA was designed holistically to accommodate electricity supply for Small (SME) sites along with Large and Street-lighting sites. As NSW leads into the new era of climate action, this arrangement secures a 7-year 100% Renewable PPA, minimising the financial risk of market volatility and paying high energy prices while supporting councils’ green transformation.

One Contract: Most Renewable PPAs require councils to sign two separate contracts (retail and renewable energy generation). Having two separate contracts for the same service is extremely undesirable because of operational risk in the management of the contract, supply reliability and reputational risk if the generator does not generate power leading to council not being able to claim renewable credentials. In this arrangement, LGP has secured energy from the Collector Wind Farm for a period of 7 years through a single fixed price contract.

Small Sites Included: Obtaining renewable energy for SME sites is quite challenging because this is not a standard offering by energy retailers. LGP’s renewable energy tender allows councils to procure all three categories of electricity (large, small, streetlighting) at once. Councils do not need to look for other options to offset emissions in the small sites.

Integrated Offering: Iberdrola, the successful tenderer, owns and operates the Collector Wind farm, thereby, minimizing supply risk and market exposure to the councils of obtaining renewable energy that’s high in demand.

Growth Commitment: Iberdrola has a robust commitment to growing renewable energy assets with a strong investment pipeline. Future assets that should come online in the next 2-3 years include Woodlawn, Bogondora, Bungendore, Flyers Creek windfarms and Narrandera solar farm; this provides comfort to the community that councils’ electricity spend is being used to increase renewable energy and reducing the reliance on fossil fuel powered electricity generators. This cannot be guaranteed through another retailer that is also investing in the fossil fuel industry.

How LGP’s Renewable PPA protect councils from market volatility?
There is a significant amount of market volatility. Recent shift to net-zero business models by fossil fuel giants such as Shell and Caltex, and regular announcements of closure of coal fired power stations has driven this market volatility. In NSW, 70% of electricity is still generated through fossil fuel powered electricity generators, and with Liddell and Eraring Power Stations soon to be out of the market, NSW energy market will also be volatile until sufficient renewable energy generators come online and the transition is complete. The war between Russia and Ukraine is increasing commodity prices such as oil and coal, which in turn is further adding to the market volatility.

LGP’s Renewable PPA fixed price 7-year contract from the year 2023 to 2029 has mitigated council’s risk to get exposed to market volatility, while driving towards Net Zero.

How does LGP’s Renewable PPA support Council’s Net-Zero strategy?
NSW councils under LGP’s Renewable PPA can claim their net zero credits through Federal Government’s Climate Active certification. This is awarded to businesses that have credibly reached a state of achieving net zero emissions.

How can I join the LGP’s Renewable PPA?
To learn about how you can access the LGP Renewable PPA and be a part of this revolution, please contact your Business Development Manager.

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