Energy projects off campus

The University engages in off campus renewable energy projects and market mechanisms to ensure we reach our target of net zero emissions from electricity by 2021.

We are involved in significant renewable energy purchase agreements with the Melbourne Renewable Energy Project (MREP) and as a partner in the Telstra led consortium with the Murra Warra Wind Farm. These agreements will have together generated enough energy (118 GWh) to offset 100% of emissions the University produces from electricity each year by 2021. We are projected to be the first Australian university to do this.

Market mechanisms to offset our impact

In 2018 the University signed a flexible retail electricity agreement with an energy retailer to conduct ‘progressive purchasing’ through a Governance Committee. This means that we have governance structures and processes in place to manage electricity and carbon pricing risks, enabling us to lock in energy prices and reduce our exposure to volatility in the market.

Circular graphic showing energy flowing from renewable energy projects to the grid, then to the corporate buyer. The green arrows show money going from the corporate buyer to the renewable energy project at a fixed price, and to the utility in a utility payment. A green arrow shows money going from the grid to the corporate buyer at market price.

What is a power purchasing agreement?

A power purchasing agreement (PPA) is a financial instrument whereby the University:

  • Purchases electricity and large-scale generation certifications (LGCs) from the wind farm for a fixed price per unit, then
  • Sells the wind farm electricity to the national electricity market (NEM) at the market price per unit.

LGCs (or accredited carbon offsets) can then be surrendered to meet the University’s net zero emissions commitment.

Committing to PPAs provides long-term certainty of supply and competitive pricing in a volatile electricity market. It also brings additional renewable energy into the Victorian electricity grid by investing in projects through combined purchasing power with other organisations.

PPAs are an innovative approach to increasing renewable energy capacity and demonstrate a viable model for cities, organisations and institutions globally to replicate.