Westpac has become the fourth Australian company – and the third major bank – to sign up to the global RE100 movement, with a commitment to source the equivalent of 100 per cent of its global electricity consumption through renewable sources by 2025.
The pledge was delivered on Wednesday, alongside news of the first phase of the bank’s renewables transition – a power purchase agreement with the Bomen Solar Farm, planned for construction in Wagga Wagga, New South Wales.
The PPA commits Westpac to purchase just over a quarter of the solar farm’s output – the project is expected to be operational by mid-2020 – under a 10 year agreement covering both the electricity and LGCs.
In a statement on Wednesday, Westpac said the deal would deliver a 45 per cent transition to renewables by 2021 for the bank globally, as well as providing greater cost certainty on its electricity spend.
As Giles Parkinson reported here today on RenewEconomy, Westpac’s offtake deal with the 120MW Bomen solar farm is part of a broader deal that marks the beginning of a tectonic shift in the make-up of Australia’s energy sector.
That is the acquisition of the $188 million NSW Bomen solar project by major network owner Spark Infrastructure, as a first move into what that company calls its “Value Build” strategy, beyond owning just regulated network assets and into a high renewables and decentralised grid.
Underpinning Spark’s purchase of the solar farm are two long-term contracts, locked in this week in partnership with former project owner Renew Estate, for nearly all of the solar farm’s output.
This includes the 10-year PPA with Westpac, and another with retailer Flow Power, over a range of tenures from 5 to 10 years.
The deal with Flow Power will see the retailer deliver nearly half the solar farm’s output to customers including wine maker Australian Vintage and iconic snack food manufacturer Snack Brands – more on that deal here.
For Westpac, the deal puts the big-four Australian bank on the path to 100 per cent renewables, and brings it into the fold of the RE100 movement, a growing global leadership initiative led by The Climate Group in partnership with CDP.
Westpac follows Bank Australia and the Commonwealth Bank into RE100, as well as software start-up Atlassian, which joined up just last week.
“We see our move towards the use of renewable energy in our operations as being key to delivering on our existing climate change and sustainability commitments,” said Westpac chief operating officer Gary Thursby.
“When it comes to renewable energy, the advancement of technology and reduction in cost has presented a great opportunity to make this transition in a cost effective way.
“As the largest financier to greenfield renewable energy projects in Australia – renewables make up 71 per cent of Westpac’s lending to the electricity generation sector – becoming a customer to this industry is an important step for us.”
Alongside the deal to buy renewable energy, Westpac has also committed $1 million – alongside Spark – to support the Bomen solar farm’s community with STEM scholarships and support for youth facilities, local biodiversity and vegetation regeneration programs.
“We’re proud to be supporting the local Wagga Wagga community – the site construction and on-going management of the Bomen Solar Farm will provide local employment and supplier opportunities. We also look forward to seeing what we can achieve through the associated one million dollar community fund over the next ten years,” Thursby said.