Sunshine lands on everybody, but the bill savings associated with owning a solar system mostly flow to those who also own a rooftop. This problem of popularising a magnificent source of energy has been a tricky one, where low-income households and apartment-dwellers are seen as being locked out from a good thing. On the surface it seems once again as though the money flows to those who already have enough.
One way around it is to build a solar plant where ownership is shared by these “locked-out” individuals, who then share the revenue from sales of electricity. It sounds a bit complex, but a 1MW project in Grong Grong, NSW, is slowly taking shape around that concept.
“We’re pioneering a new way of doing community energy,” says Community Power Agency advocacy manager Kristy Walters. “It’s set up to be similar to the process of how people would get rooftop solar, with one upfront payment. The key difference is it’s not on your rooftop, but you get similar benefits as if you had rooftop solar.”
To become a reality the Haystacks solar farm is looking to raise about $1.4 million by selling 333 shares between $4,000 and $4,200 each. Haystacks is a joint effort between the Community Power Agency, an advocate for shared clean energy, community energy group Pingala and consultancy Komo Energy, who will deal with the EPC, oversee grid connection and liaise with the landholders.
When a deal with an EPC and retailer is finalised an interim prospectus will be released, including the finalised price for a “garden plot” and the expected return. Without an agreement with an offtaker Haystacks isn’t able to provide prospective investors with an estimate of annualised returns, which would be delivered as discounts on their electricity bills.
After 20 years members of the cooperative will need to decide whether they want to continue operating the plant, so long as it is generating efficiently, or decommission it. Investors would be locked in with one retailer for their energy needs for the 20-year term.
Grong Grong is about 400km west of Sydney in the NSW Riverina region. The area hosts a few utility-scale solar farms, including the 180MW Coleambally, 27MW Griffith, 120MW Bomen and 275MW Darlington Point plants, and there is a queue of solar and storage projects in the pipeline.
The idea was to first of all seek backing for Haystacks among locals of the area, and so the Community Power Agency hit the road for meetings in Narrandera and Wagga Wagga, and more targeted discussions in Griffith, Leeton and Junee.
“We haven’t had any negative feedback,” says Walters, who admits the idea of packaging a solar investment suited for people who are locked out of owning their own PV in a part of the country where dwellings are mostly all detached and flooded by sunshine hasn’t necessarily clicked. “They don’t have apartments, they don’t have shading issues, so a lot of them have said, great project, but your solar gardeners might be in Sydney.”
Is it good value?
In 2018 the Social Access Solar Gardens project, funded by the NSW government and ARENA, set out to discover whether solar gardens are desirable, feasible and viable to locked-out energy users.
Research by the Institute for Sustainable Futures found there is interest in solar gardens so long as they offer equivalent value to investors as rooftop solar, which isn’t surprising. Low-income respondents would only consider a subscription or lease model, rather than an upfront lump sum. Contrary to the notion of seeking out localised investor interest, no-one seemed to be fussed about where a solar garden was sited “as long as it works”.
Work by Norton Rose Fulbright found solar gardens are feasible, helped by the facts a generator licence is not required for anything under 5MW and neither is a retail licence as the retailer partner will already have one.
But on a viability metric the scheme looks to be shot through. Without subsidies, the ISF report found, a full cost share delivers a simple payback of 10-16 years, compared to simple payback of about five years for rooftop solar.
“If current support programs for rooftop solar were expanded to include solar gardens, the model would become viable for all currently excluded consumers: renters, apartment dwellers and low-income consumers,” the report said. “In fact, solar gardens may be the only model that can help all locked-out households sidestep their specific barrier to solar.
“However, we note that the return to the consumer is greater from rooftop solar, so where that is possible it should be a first choice.”
Haystacks expects to finalise an agreement with an EPC and energy retailer within weeks, Walters told EcoGeneration. The project relies on some funding from the NSW government’s Regional Community Energy Fund, worth $1,320,565.
If all goes well and the scheme is delivered, Haystacks investors will see returns as a line item discount on their energy bill with the approved retailer. “It would look almost the same as if people had panels on their own rooftop,” Walters says. Fees will have been deducted for asset management, operations and maintenance, insurance and cooperative running costs.