Australia’s aged care sector is continuing to drive growth in the nation’s burgeoning commercial solar market, as an industry trying to accommodate Australia’s huge, ageing population looks to cheaper, cleaner sources to meet its energy needs.
In Queensland – where Treasurer Curtis Pitt last week named aged care as one of the state’s major future growth markets, in comments downplaying the economic importance of the state’s fossil fuel resources – two new PV installations on aged care facilities illustrate the growing connection between the two sectors.
The first, a 100kW rooftop solar power installation for Loreto Nursing Home in Townsville, will produce around 180MWh annually of self-generated electricity, with a payback period of less than three years and returns of over 30 per cent.
David Naismith, director of Solgen Energy who installed the system, said he is not surprised that an asset that can deliver returns in excess of 20 per cent is attracting strong interest.
“The profile of energy consumption within the aged care sector makes a very compelling business case irrespective of the size of the operator,” he said.
“As returns have grown, purchasing channels for solar power systems have also grown. While purchasing outright generally still generates the best returns, financing options under power purchase agreements or leasing mean the system can be installed at zero cost from day one. The savings generated are then used to pay the financing over the term – irrespective, it still ends up cash flow positive for the business.”
More recently, Solgen was awarded a 100kW solar power project for SwanCare Group, a leading provider of residential care facilities who unveiled its plan for 44 new architect-designed apartments that are currently being sold off the plan and expected to be completed late 2016.
A rooftop solar photovoltaic system is set to further reduce the energy consumption and running costs of the entire building. The project is planned for completion at the end of this year.
In South Australia, local outfit Tindo Solar recently revealed it had a pipeline of more than 500kW of rooftop solar projects from the aged-care sector alone, worth more than $1 million.
Tindo founder and Managing Director Adrian Ferraretto said in a company statement in June that demand from the state’s aged care market over the past year had been unprecedented, with more and more providers seeking to cut their long-term operating costs.
Ferraretto, who describes aged care facilities as a perfect fit for solar, said his company had secured seven major commercial solar projects in the sector over the past 12 months, including two 100kW rooftop systems, one 96kW system, and one at 90kW.
“(They) generally have a high electricity demand due to their 24-hour requirements, so as traditional energy prices continue to rise, it’s actually not surprising that more facilities are now pursuing solar electricity as a cheaper, renewable alternative,” Ferraretto said.
“Crucially, it also allows facility owners to capitalise on a complete return on investment, typically well within five years.”
Meanwhile, international company Bupa Aged Care has installed solar power systems at 41 of its facilities across Australia, making it the nation’s largest privately owned solar power producer; with a total of more than 4.5MW of PV installed.
Globally, Bupa’s £50 million ($A96 million) Energy Saver Fund will have resulted in nearly 1,000 low carbon projects implemented by July this year. According to The Guardian, Bupa will save about $A7.68 million a year on bills and reduce the carbon footprint of two-thirds of its buildings.