Aldi Australia says it will be 100 per cent renewable by end of 2021

The Australian arm of German discount supermarket chain Aldi has pledged to source 100 per cent of its electricity from renewable resources by the end of 2021, after the rollout out rooftop solar across its stores and distribution centres and the inking of two wind energy offtake deals.

Aldi Australia said on Wednesday that it had already succeeded in slashing its operational emissions by 40% from a 2012 baseline using solar and energy efficiency measures, and was on track to reach 100% renewables by the end of next year, with yet more solar and out-sourced wind power.

The Australian commitment is a part of a company-wide target for climate protection endorsed by the Science-Based Target Initiative (SBTi), which is backed by CDP, the United Nations Global Compact, World Resources Institute (WRI) and the World Wide Fund for Nature (WWF).

“We cannot ignore that we are a large user of energy and subsequently, we will continue to take steps to reduce our impact,” said Aldi Australia CEO Tom Daunt in the company’s Good Energy Report, released on Wednesday.

“We’ve chosen to take action and make the shift to 100 per cent renewable electricity to power our Australian operations by the end of 2021.”

It’s an impressive move. Aldi is the 64th biggest user of electricity in Australia, with 555 stores and eight distribution centres around the country. And the pledge to be 100 renewable powered within 18 months puts it well ahead of key rivals, Woolworths and Coles.

Having kicked off its rooftop solar roll-out at a Tweed Heads store in Northern NSW in 2015, the retailer is on course to have 250 stores and six distribution centres fitted out with a total of 31.6MW of solar PV by the end of 2020, generating more than 50,000MWh of electricity.

This has been a mammoth effort – Aldi claims it amounts to Australia’s largest commercial solar rollout – which has been implemented in partnership with NSW-based outfit, Epho.

According to Epho, each ALDI store is generally fitted with a 100kW rooftop solar system, which “coincidently is also what is needed to off-set the day-time energy consumption of the store.”

On ALDI’s distribution centres, the commercial arrays ranged in size from 1.5MW at the Dandenong facility in Victoria, to 1MW in Brendale Queensland, and 650kW in Regency Park, South Australia.

“The power of these business relationships proved themselves more than ever during COVID-19,” said Epho managing director Oliver Hartley in a separate statement on Wednesday.

“Despite the backdrop of a pandemic, Epho could continue the rollout of the solar program [at a rate of 100 stores in 100 business days] working closely with the ALDI team to ensure that everybody was safe and adhered to the health guidelines.”

For its wind energy, Aldi teed up two power purchase agreements in the first half of this year, the first a 10-year deal with Ratch Australia to buy just under 20 per cent of the power generated by its 227MW Collector wind farm in the New South Wales Southern Tablelands.

The second PPA, secured just a month later in April of this year, is a 10-year deal with Tilt Renewables to buy around 6 per cent of the output of its massive 336MW Dundonnell wind farm in Victoria.

All told, the wind farm partnerships – both of which are scheduled to kick in in January 2021 – will generate more than 180,000MWh of electricity to go towards powering Aldi Australia.

On top of this, the supermarket chain has invested in more efficient systems to reduce energy usage and carbon emissions, including LED lighting, energy-efficient chillers, and upgrading to natural refrigerants.

And if onsite and offsite renewable energy generation falls short of meeting the retailer’s electricity demands, Aldi says it will cover the difference by buying renewable energy certificates.

But the long-term goal, the report stresses, is to reduce the number of certificates purchased and to continue to invest in renewable energy generation.

“We will continue to work within our business and closely with our business partners to reduce emissions and preference renewable sources of energy,” Daunt said.

“Despite short-term costs, we believe that continued corporate investment in renewables will net cost reductions for us and others in the years to come.”

Corporate deals are, indeed, becoming increasingly important to the continued growth of Australia’s large-scale renewables industry, particularly with the Large-scale Renewable Energy Target bringing to a close any form of federal government policy support for the industry.

For Tilt Renewables, the owners of Dundonnell wind farm in Victoria, the deal with Aldi marked the company’s first ever PPA with a “true corporate player” and not a gen-tailer or government entity.

“And it was no small player,” said Tilt’s Deion Campbell in an interview with One Step this week. “This is a quality off-taker.

“It’s quite exciting,” he added, “it means we can take more of the ‘build it and they will come’ approach.”

For Tilt, the development of Dundonnell hasn’t been all smooth sailing, with the project’s commissioning process stalled at around one-third of its full generation capacity after unanticipated connection concerns were raised by grid operator, AEMO.

This has been frustrating for the company, particularly considering its own efforts to get the project completed on time and budget, and within the specifications set down by AEMO before construction.

But Campbell says Tilt is working “very closely” with AEMO to solve the as-yet-unspecified grid issues, and boost energy production levels to around 66% of expectations by the end of this year, paving the way to full output, including further hold points of 226MW and 300MW.

And while last-minute grid connection problems thrown up by AEMO have made future project investment decisions in Australia more challenging for Tilt, the troubles at Dundonnell will have no impact on the offtake deal with Aldi.

“In reality, this issue is a major investment turn off, and we’re all being very careful,” Campbell told One Step. “But we’re not put off. We’ve got 47-odd people sitting here in Melbourne with at least half of them ready to go on the next project.

“We just need to spend a little more time and do a little bit more due diligence.”