ERM Power Announces Renewables Offtake Agreements
ERM Power today announced it has reached agreement on commercial terms that will underpin the construction of two renewable energy generation assets in Australia. The two facilities will have a combined capacity of more than 300MW.
The foundation contracts for the purchase of Large-scale Generation Certificates (LGCs) have been the subject of negotiation with developers since mid-2016 and will commence in 2018. Project details remain commercial in confidence until the respective projects reach financial close, and are subject to standard conditions.
ERM Power CEO Jon Stretch said the offtake agreements underpinned construction of these renewable projects which resulted in creation of LGCs, contributing to the Renewable Energy Target.
“These agreements were enabled by the LGC Scheme flexibility which allows for LGC surrender over a three-year period,” he said.
“ERM Power has retained the option to surrender 2016 LGCs over the prescribed three-year window, creating the economic conditions which enable us to enter into agreements with renewables developers.
“The Scheme flexibility has allowed us to bridge the disconnect between the annual LGC surrender cycle and the longer-duration commitment needed by renewables developers to underpin their project revenue.
“We support the continued reduction of greenhouse gas emissions and consistent and enduring national energy policy, but it’s critical that we use the least cost technology to achieve carbon reduction targets.”
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About ERM Power
ERM Power is an Australian energy company operating electricity sales, generation and energy solutions businesses. The Company has grown to become the second largest electricity provider to commercial businesses and industrials in Australia by loadi. A growing range of energy solutions products and services are being delivered, including lighting and energy efficiency software and data analytics, to the Company’s existing and new customer base. The Company operates 662 megawatts of low emission, gas-fired power stations in Western Australia and Queensland.
iBased on ERM Power analysis of latest published information.