Enova Energy has become the first Australia’s first community-owned energy retailer to gain a licence to sell electricity to consumers, in what could become the first important step to a complete re-design of the energy market.
The Australian Energy Regulator (AER) approved Enova’s application for a retail licence on Friday, subject to completion of Enova’s current capital raising by late November. Enova is seeking for raise $3 million, and is half way to that target.
Alison Crook, the chair of the retailer’s board, described it as an “historic” event. “This is the first community owned organisation to get right to sell electricity to community,” she said. And she expected many others to follow.
“Lots of other communities are saying that they want us to succeed, so that they can follow.” Indeed the model could be used in towns and communities keen to establish renewable-based micro-grids, which are now being a cheaper and more sustainable alternative to the system of centralised fossil fuel generation.
Enova will be based in the northern rivers region of NSW, but will sell electricity to consumers as far south as Coffs Harbour and Glenn Innes.
Enova says the structure will allow it to better support community energy generators – such as those being planned by various groups such as COREM (Community Owned Renewable Energy Mullumbimby) which launched last night, and encourage more renewable energy take up in homes and businesses.
Enova CEO Steve Harris said shareholders will reap benefits from high feed-in tariffs, industry low supply charges and shareholder dividends. “Because it is local, Enova will be able to focus completely on its local customers, providing a personal level of service unique in the energy supply sector,” Harris said.
The retail licence enables Enova to enter into financial arrangements with all parties in the energy sector.
In particular it will enable Enova Energy to purchase energy from local renewable energy generators such as that being proposed by COREM in Mullumbimby and the Lismore community solar initiative.
It also allows Enova to enter into arrangements with Essential Energy, the local grid operator, to transport that energy through the grid to customers who wish to purchase it and in addition install their own electricity meters if they wish.
Enova plans to offer 100% new renewable energy as the lead offer at a price considerably lower than other companies as well as an attractive feed in tariff rate and a mix of conventional power and Greenpower at start-up.
“We will make it simple to switch from your current energy retailer and we will look after our customers by giving them unbiased advised on the best solutions for their energy needs, whether that is the best energy plan, installing solar or going completely off the grid”, Harris said.
Enova says its structure will create jobs in local communities, and prevent as much as $80 million from leaving the local economy. That’s the amount that is currently funnelled to large national and international companies from electricity charges in the region.
Harris said Enova Energy could show the rest of Australia how they too can take the power back into their own hands. “Enova could be the hub which assists communities around Australia to achieve similar goals.”
The fund raising is due to close on November 27. A prospectus and share application can be downloaded at www.enovaenergy.com.au