How it works

The model outlined in Renewable Newstead’s business plan, is (preferably) for a single energy retailer, which is also a renewable energy generator to finance and operate the solar farm at Newstead and retail the generated energy to local consumers.

Cheaper electricity for Newstead and surrounds

Retail tariffs would be structured to reward daytime energy use as opposed to the former off-peak tariff model which was designed to match energy demand to coal-fired generators. New tariffs would match energy demand to solar farm output instead.

The model promises that loyal customers i.e. those signing up to buy energy from the farm for 10-15 years would reduce their energy bills by at least 10 per cent and by up to 30 per cent on current prices.

Current model

Energy comes from the grid to Newstead homes (some with solar panels) where it’s billed by various retailers charging different tariffs.

Our proposed model

Energy from Newstead’s solar farm is fed into the grid and then to Newstead homes where it’s billed by a retailer offering an electricity price that includes distribution costs charged at $1/day rather than by the kWh.

Important elements of the model and why we chose them

Outsourcing investment, construction and management

The farm is to be built and operated by a company with expertise and experience in doing so. RN does not see itself as having the expertise to build and manage a solar farm and does not see the need to take on this risk. Nor does it want to become an energy retailer. At community gatherings, the community of Newstead indicated it supported this approach.

Building the solar farm locally

The farm will preferably be built near the town so the community can see it and claim it as their own. This will increase local connection and a local sense of ‘ownership’, and will motivate Newstead households to sign up as customers of their local solar farm. Community support for a suitable local site, chosen through an expression of interest process, would be sought by Renewable Newstead.

Solar as our energy source

Solar was chosen above wind and bioenergy because it is the cheapest to install. The estimated capital expenditure for each energy source per kilowatt hour (cents/kWh) is as follows: solar farm 6.3, rooftop solar 8, wind 9.3 and bioenergy 12.9. Newstead’s location is not suited to wind generation. Bioenergy, hydro-storage and geothermal energy were dismissed as too impractical from the outset.

Key benefits of the model

Newstead customers’ power bills are expected to fall by 10 to 30 per cent.

Newstead customers will be able to use more energy without paying higher distribution network charges.

Sign-up is optional. No-one will be forced to switch to the Newstead solar farm energy retailer.

The model paves the way for long-term security of investment for small-scale community solar projects built locally.

Renewable electricity will be cheaper than bottled gas or wood, providing an alternative in Newstead which does not have piped gas and where wood is becoming increasingly expensive.