Victorian councils benefit from energy procurement deal
Twenty Victorian councils have recorded savings in electricity and gas costs as a result of a four-year agreement that locked in highly competitive prices.
Cr Bill McArthur, President of the Municipal Association of Victoria (MAV) said that joint tenders conducted in 2011 provided participating councils with electricity cost savings for their buildings, public lighting and green energy, as well as gas savings for facilities.
“Large council buildings and facilities saved around 20 per cent on electricity costs during the first year, while public lighting achieved savings of 22 per cent, and smaller tariff sites had cost savings of 34 per cent.
“There were no increases in gas costs for large council buildings and facilities, while smaller tariff sites also received 15 per cent savings on their gas costs.
“These results show the sizable benefits on offer when you leverage the combined purchasing power of councils with a professionally-managed process.
“Like everyone else, councils will face higher utility costs from the introduction of a carbon price this year.
“MAV Procurement, in partnership with Trans Tasman Energy Group conducted the tender on behalf of participating municipalities to help offset the anticipated electricity and gas price hikes.
“It’s a fantastic outcome to achieve such significant savings for ratepayers at a time when prices are rising. With three year’s remaining on the agreement, we expect the cumulative savings to grow further,” he said.
Successful tenderers included TRUenergy, Power Direct, COzero, and Origin Energy.
Cr McArthur said MAV Procurement would now build on these achievements through a new project to deliver cost savings for Victorian councils who make the change to energy efficient street lighting.
“More than $50 million is spent by councils each year on public lighting. This is between one and two per cent of total council expenditure and the largest energy use for many councils, so reducing these costs is a priority.
“In 2010 the Give Our Streets the Green Light campaign by the MAV and councils helped secure $20 million under the Victorian Government’s Green Light Plan. $200 million has also been committed for the Australian Government’s Community Energy Efficiency program.
“With around 300 000 local road street lights using 80W Mercury Vapour (MV) lamps, conversion to energy efficient lighting will reduce councils’ greenhouse gas emissions, energy use and expenses.
“A bulk changeover to energy efficient globes could save 1.56 million tonnes of greenhouse gas emissions over the life of the new lights.
“With the expertise of MAV Procurement, we hope to assist councils in transitioning to energy efficient street lighting through a joint tender for the purchase and changeover of hardware.
“Energy efficient lights use up to 68 per cent less electricity than the current MV lamps so there are clear long-term cost savings for councils that make the switch.
“Since commencing in 2009 MAV Procurement, a not-for-profit entity, has conducted 27 tenders to reduce councils’ costs and deliver systemic improvements to service delivery,” he said.