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What Victoria’s new energy announcements mean for regions

– Tony Goodfellow, VIC/TAS Coordinator, RE-Alliance.

Last week, the Victorian Government made some huge and welcome commitments for our renewable energy future, provided they are re-elected in November. 

State Electricity Commission

In a historic move of reverse-privatisation, Premier Daniel Andrews has committed to revitalise Victoria’s State Electricity Commission, which would build and operate a portion of new renewable energy projects across Victoria. 

The government has also set a target of 95% renewable energy by 2035 and an emissions reduction target of 75-80% by 2035, which are important steps in protecting our communities from the worst effects of climate change. The planned transformation has been described by Adam Morton as "one of the fastest transitions from a high-pollution power grid to a near zero-emissions system anywhere in the world."

The government has also pledged to make a $1 billion investment to deliver 4.5GW of energy from renewables projects, and they say that this would create the opportunity for 60,000 jobs for Victorians.

These re-election commitments would see Victoria catapult towards an energy transition in line with climate science, and towards one that would allow regional communities to thrive. 

Government-owned renewable energy generation affords an opportunity for communities to benefit from the transition, through a similar mechanism as VRET 2 – applying best-practice community benefits and engagement, which the Victorian Government has previously shown leadership on.

This comes just two weeks after the Queensland Government confirmed they will kickstart a “renewable energy industrial revolution”, converting state-owned coal-fired power stations to renewable energy hubs and investing in new renewable projects that will stay in the hands of Queenslanders.

Last week, Victoria also made a landmark agreement with the federal government consisting of $1.5bn in concessional finance for Victorian Renewable Energy Zones (REZs) and $750m concessional finance for the Victoria-New South Wales Interconnector West (VNI West), another key transmission line needed to unlock renewable energy potential and transition to 100% renewables. Transmission is one of the biggest barriers for new renewables, so we’re pleased to see funding for these projects. Read more about the announcement and what it means in our blog post.

In all this development, there is an important opportunity here for VicGrid – the body managing the development of Victoria’s Renewable Energy Zones – to take a bigger role on the ground, to ensure a well-coordinated and thoughtful approach to our renewable energy roll-out.

RE-Alliance will be watching as all these plans progress, and we will continue to advocate for regions to ensure communities, especially First Nation communities, are properly engaged and benefit from renewable energy projects.

Victorian Renewable Energy Target 2

Amongst the flurry of activity in climate and energy announcements over the last few weeks, there was also an announcement for the Second Victorian Renewable Energy Target auction (VRET 2). Minister for Energy Lily D’Ambrosio announced the successful projects for Victoria’s second renewable auction. These projects will power hospitals, schools and public transport in the state, lower emissions and provide cheaper power. 

We have previously written on VRET projects, and this is now the second round, which will unlock 623 megawatts (MW) of new renewable capacity with six solar farms and four big batteries across the state. According to the Victorian Government, these projects will support  “920 direct jobs, create around 290 positions for apprentices, trainees and cadets and deliver $1.48 billion in investment.” Solar combined with batteries will bring resilience to the grid as it moves to 100% renewables.  

In order to be successful the projects must demonstrate community benefits, the Government has stated:

“All projects have demonstrated that they are engaging communities to at least the ‘involve’ level, as described in the Community Engagement and Benefit Sharing in Renewable Energy Development – A Guide for Renewable Energy Developers, and have committed to benefit sharing plans reflecting engagement on the needs and aspirations of local communities.”   

RE-Alliance contributed to the design of the guide, providing a submission that asked for enhanced community benefits of projects.

Apart from job creation, payments to landholders and payments to councils, there are also additional community benefits that these projects can provide.   

Fulham Solar Farm has committed to creating an Aboriginal Engagement and Participation Plan, a Local and Social Procurement Policy, committed to GROW Gippsland which has the goal to, “​​maximise local and social impact in the Gippsland region. This is primarily through a focus on local and social procurement and local and inclusive employment.” The proponent also has committed to creating a Fulham Community Fund. All the initiatives comprise the Fulham Community Benefits Scheme.

Fraser Solar Farm has committed to a community enhancement fund. “The fund will be managed locally – where possible – together with community representatives once the solar farm is in operation.” They will have grants of up to $10,000 per year available for not-for-profit organisations to deliver community projects in these areas. Along with grants South Energy offers sponsorships and legacy initiatives such as educational programs or scholarships. The Glenrowan Solar Farm has made a similar commitment: “We will develop constructive partnerships with local communities and stakeholders to explore opportunities to share benefits from the Glenrowan Solar Project in ways that have meaning and impact.” 

Will we report back in the future with more details on the community engagement and benefits of the successful projects. 

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