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Standing Committee on the Environment and Energy

ALDEN, Councillor Dr Jennifer, Mayor, City of Greater Bendigo [by video link]

FERRES MILES, Ms Claire, Chief Executive Officer, Sustainability Victoria [by video link]

HICKS, Dr Jarra, Director, Community Power Agency [by video link]

NIEMANN, Mr Craig, Chief Executive Officer, City of Greater Bendigo [by video link]

READE, Mr Luke, President and Policy Advocate (Energy and Climate Change), Energetic Communities Association [by video link]


CHAIR: We now welcome representatives from Sustainability Victoria, the City of Greater Bendigo, Energetic Communities Australia and the Community Power Agency. Although the committee does not require you to give evidence under oath, I should advise that this hearing is a legal proceeding of the parliament and therefore has the same standing as proceedings of the House. The giving of false or misleading evidence is a serious matter and may be regarded as a contempt of parliament. I now invite you to make some opening statements before we proceed to an open discussion.

Ms Ferres Miles : Thank you very much to the committee. I just want to start by acknowledging that I join you today from the lands of the Wurundjeri and Woiwurrung people of the eastern Kulin nation and pay my respects to elders, past, present and emerging. And I acknowledge the deep connection to earth of the First Nations people over the past sixty thousand years and their invaluable contributions to our understanding of climate change and the environment. Thank you for the invitation to speak to the committee today.

Sustainability Victoria is a statutory delivery agency of the Victorian government and our purpose is to accelerate Victoria's transition to a circular climate-resilient clean economy. All of our work contributes to achieving three targets by 2030: 50 per cent emissions reduction, 80 percent waste diverted from landfill, and 3,900 new clean economy jobs. Sustainability Victoria provides three unique services: accelerating infrastructure and innovation investments, leading state-wide behaviour change and delivering direct community action in neighbourhoods and regions. To do this, we partner with Victorian industries and businesses, entrepreneurs, cutting-edge research institutes, schools, households, individuals, community groups and across governments, including the commonwealth, local and state, to deliver measurable impact. Of importance today, we achieve impact due to our deep stakeholder connections and relationships in place, and our understanding of community needs and aspirations, informed by research, data, marketing, intelligence and behavioural insights.

So what are the community telling us? They have told us that there is vast knowledge in our communities with a desire to act on climate change that can be leveraged. However, communities, including industry, business and households, have also told us that there are many barriers to action. There are three things I wanted to highlight to the committee today. The community need a backbone organisation that delivers change through facilitation, coordination and peer-to-peer knowledge sharing, they need more support with financing and new financing mechanisms to assist with making climate change projects a reality, and they need policy certainty and consistent ongoing support from government.

So how is Sustainability Victoria, responding and what has it achieved today? In my opening remarks, I want to share with the committee a brief overview of the Community Power Hubs Program. Community Power Hubs is a very successful program delivering 10 community power hubs in Victoria. Initially as a pilot in 2017 and more recently in 2020, the Victorian government has made a commitment to deliver 10 community power hubs across every region in Victoria, including two regions in metropolitan Melbourne. A community power hub is a partnership between government and the community, leveraging the strength of each. It involves a lead local community not-for-profit organisation acting as the regional host for other local sustainability organisations. The hubs operate under a collaborative governance model to drive participation and engagement in local community led renewable energy projects that are financially viable, technically feasible and socially acceptable.

So what has the program achieved? For the first pilot, there were six direct jobs and 16 indirect jobs in place in regions, supported by over 12,000 volunteer hours. Fifteen community energy projects were financed and delivered, saving community projects and community facilities nearly $4,000 in electricity bills every year. The current program is scheduled to achieve 37 short- and long-term direct jobs and 71 short- and long-term indirect jobs.

What have we learnt and how have we adapted? There are four points I want to highlight to the committee. First, the demand for government investment is very high for community led renewable energy projects. The three pilot hubs that we delivered had a significant return, leveraging $14.5 million of value, which equated to a 13.1 leverage of government investment. Second, there is a role for government to fund sustainable finance. With our current project, we have a $1 million fund, which is available for community groups to secure low-interest finance for their projects. Third, equity of government investments. It's incredibly important to have an equitable and justly distributed spread of resources across, in this case, the country. Every hub is important and each community has different levels of capability and capacity to support delivery of a hub. Funding for regional direct jobs always needs to be balanced with volunteer support. With our pilot, we found that there was a huge risk of volunteer burnout, so with our second program we are employing paid staff to support volunteer hours. And finally, the support of government funded staff to work alongside the hub leads and volunteers to provide direct governance, technical and financial expertise.

In closing, creating a circular economy and achieving 50 percent emissions reduction by 2030 will require practical and systemic community action across all economic sectors. I'm very happy to answer questions the committee might have.

Dr Alden : Thank you for the opportunity to speak to this important inquiry regarding the Australian local power agency. I'd like to acknowledge I'm on the land of the Dja Dja Wurrung and further acknowledge the traditional owners of the lands that you're on today. The City of Greater Bendigo lies in central Victoria, two hours north of Melbourne. Greater Bendigo is home to 120,000 people and is now the third-largest economic base in Victoria. We are the regional service centre for employment, education, health, entertainment and recreation. On behalf of the City of Greater Bendigo, I wish to express strong support for the proposed Australian local power agency. Never has there been a more important time to establish a specific agency to facilitate and finance community power hubs. This is principally driven by a rapidly changing climate and the urgent need to remove our reliance on fossil fuels as quickly as possible. It's further driven by ever-increasing electricity prices that are causing economic hardship to many segments of our communities. I believe there's an urgent need for government intervention to transform our energy systems. This must enable the rapid uptake of renewable energy on a grand scale Very importantly, it must also facilitate community ownership so that electricity is affordable and the profits are circulated within our communities.

The city has the goal to reach net zero carbon by 2030 and to be powered by 100 per cent local renewable energy by 2036. Additionally, we're striving for 50 per cent community ownership. Over $200 million leaves our municipality each year in electricity bills, and the city's aspiration is to retain this money by creating a locally owned renewable energy system. I believe the Australian local power agency bill is well aligned to support our aspirations.

The city has already switched to renewable energy for its own energy needs via the Victorian energy collaboration. It saw 46 local governments sign a 10-year contract to purchase renewable energy and directly invest in Victorian wind farms. This is the largest-ever emissions reduction project undertaken by local governments in Australia. The city is also working on the Power it from the Rooftop project to utilise the rooftops of council-owned buildings to increase solar generation. This project is a public-private partnership with the private sector paying upfront capital costs and then recouping their costs by selling energy to the grid. This partnership model was required to overcome the city's constrained capital budget. Should the proposed Australian local agent power agency be created, it would reduce reliance on private sector investment.

We're also collaborating with RMIT University on the renewable energy community transition project. This project is modelling and planning for large-scale solar generation on all suitable homes and businesses within Greater Bendigo. We have found that Greater Bendigo could be a net exporter of renewable energy, generating five times more energy than current demand. This is a game changer for Greater Bendigo. However, it's presently unclear how the project's next steps of infrastructure design and the business case will be funded. This example demonstrates there's a strong need for financing from the proposed Australian local [inaudible].

Since 2008, the Bendigo Sustainability Group and the City of Greater Bendigo have experimented with solar rooftop purchases, bulk purchases and community power hubs. This included pioneering a third-party ownership model for solar projects on council buildings. This model has enabled the Bendigo Sustainability Group to pay upfront costs and recoup costs by selling power generated back to the city. This model has reduced emissions and avoided costs to the city's capital budget. It's also provided Bendigo Sustainability Group with a steady income, very importantly supporting community sustainability projects.

In 2018, the Bendigo Sustainability Group was one of the three community programs in Victoria to pilot a community power hub program. The pilot program resulted in 15 community power hubs in Bendigo, and these hubs generated 1,700 megawatt hours of renewable energy and saved community groups over $364,000 in electricity bills each year. Over the life of the program, the community power hubs represented a 13-to-one return on government investment.

The pilot program has been so successful that the Victorian government has recently invested an additional $3.3 million into community power hubs, including the Bendigo Sustainability Group rolling out community hubs across the Loddon Mallee region. There is huge potential to enable community power hubs. There is already available technology and existing models to build from. Advancing these is, however, dependent on having appropriate financing models. The ball for the Australian Local Power Agency is perfectly placed to address this need.

Local communities and local governments are ready to participate in the transition to fully renewable and locally owned energy systems. For Greater Bendigo, this is about changing our energy system from being an importer of energy to a generator of renewable energy. Transition to a local energy economy would represent over $200 million per year remaining in our community. That would have many flow-on benefits—namely, affordable energy, new jobs and a safer climate.

CHAIR: Thank you very much. Can we please go to Energetic Communities.

Mr Reade : We welcome the opportunity to provide important commentary and support formation of ALPA community power hubs. I want to acknowledge the Jagera and Turrbal nation on whose land I join you from, in Mianjin in Brisbane.

I'd like to start with our first community energy project. It's a small one. Behind the metre, we had 19 community investors funding solar on the roof of Food Connect, which itself houses many local small food businesses and social enterprises. In the first year the panel saved the shed and its tenants nearly $4,000, and also our investors received their first principal payback and a five per cent return on investment.

We found the lack of early adoption of funding a key challenge. Our share was easily met within 48 hours once we opened the project to investors, but to get to that point required a huge amount of volunteer and pro bono professional advice to get through the feasibility stages. We were able to do this for a relatively small rooftop project, but we struggled to afford the resources for more complicated projects requiring planning approval, for instance. We're fortunate to have some experienced directors but nonetheless struggled to access timely and fit-for-purpose legal advice and documentation. Without further sector support, we'll continue to struggle to achieve the great social, environmental and economic benefits that community energy can bring.

Community energy ensures local economic development. It's one of the key reasons why we do it. It keeps the money in the local community and often attracts the community members who support local purchasing decisions. We aim to use local procurement in everything we do.

In terms of community energy support, we're regularly approached by Queenslanders seeking advice on how to develop their own projects in their own communities, to run workshops et cetera, and that's without us seeking those connections. Just to give you an idea, we've presented to or worked with communities from Cairns, Yeppoon, Bundaberg, Maleny, Gympie, Coolum, Noosa, Kenmore, Ashgrove, Salisbury, Mount Tamborine, Kenmore Hills, Scenic Rim, Toowoomba, Stanthorpe and Redlands, and also the Woodford Folk Festival. So this indicates a high level of support for renewable energy, but, particularly locally, community owned small and medium solar.

We'd love to continue to help facilitate and work with those groups and expand the benefits of community energy. The passion and willingness to act is clearly there. But we're currently a volunteer-run organisation. We can't keep providing the resources or support for those groups, nor the other Queensland based organisations, to fill the gap. And obviously paid staff through a community energy hub would facilitate this. It's been frustrating to watch projects either lag or not get developed at all, reducing the ownership and benefit. So we've approached the Queensland government for support, similar to other support in Victoria, such as the hubs or the New South Wales funding. But they continue to fail to support local communities in their energy efficiency or community energy ambitions.

I also to want to make the point that urban environments also offer an opportunity to try more innovative projects, such as new technologies, including EVs, electric vehicles, strengthening the argument for community hubs in urban locations as well. So community power hubs offer an opportunity to use trusted, community based organisations to provide broader energy, health and financially supportive projects to facilitate low-income household access, in particular, to low-emissions technology and energy efficiency.

One thing I'd like to add to other conversations today is that the ACCC pricing inquiry recommendation 38 supported governments to fund, to the value of $5 a household for each NEM region or a total of $43 million a year, a grant scheme for consumer and community organisations to provide targeted support to assist vulnerable consumers and improve energy literacy. This can clearly be extended to training, identifying grants and other opportunities through organisations offering financial counselling services, for example. It could add value to the community energy supports themselves. And here I'm referring to things like engineering, legal, regulatory, financial and community engagement toolkits and expertise. Such hubs could therefore facilitate energy literacy and support vulnerable households through home energy advice, energy efficiency, accessing distributed energy resources, community batteries, and supporting climate adaptation in households. One example overseas that has done this quite well is the community action or cafe program in the UK. In short, the hubs can provide a social licence and be a powerful tool to support jurisdictional renewable energy targets, a fast and fair transition, and climate change adaptation, furthering affordable and healthy homes.

In the Queensland context, I think regional consumers could potentially benefit more than other states, as they don't have a choice of retailer; they can only access Ergon Retail and may therefore miss out on some innovations from other retailers. An example is another community owned retailer that offered for other consumers, for the solar members, to give credits, donate credits, to vulnerable households during COVID, so demonstrating a social impact. It's also important to reiterate government funding in community energy, further community funding. The pilot program, for example, had a 13 to one increase in government investment. And, over the 25 years of the program on the projects, that's $22 for every dollar of government funding. That comes from the Sustainability Victoria report. And that's clear that public money is well spent, but also to note that the funding needs to be long term.

Finally, we support the idea of First Nations communities being involved in the governance of the agency. Communities have their own specific needs—remote Indigenous communities—and have been made vulnerable to climate change and could see some of the highest benefits through local renewable energy and energy efficiency. ECOS, for example, did some work, with the Woorabinda remote community in Queensland, and found significant energy injustice, such as poor housing quality, culturally inappropriate engagement and poor service delivery. So having First Nations representation on the ALPA would significantly improve the lives of Indigenous Australians in remote communities, especially those with poor quality housing. So I will finish there and just thank you again for the opportunity to provide statement.

CHAIR: Thank you very much, Mr Reade. Community Power Agency, Dr Hicks?

Dr Hicks : Thank you for the invitation to be here. I am here from Biripi country on the north coast of New South Wales. I'm a director of the Community Power Agency, and we're an organisation that provides advice and services to community energy groups across the country. We've worked with groups from Alice Springs to Hobart to Shoalhaven, whom you heard from earlier today, and Gippsland—right across the country. We play a similar role to the proposed role of the community or local power hubs. We're very supportive of this bill and of all aspects of this bill. I'll also be drawing today on our knowledge of the benefits of the hubs, having been involved in the final evaluation of the Community Power Hubs Program in Victoria. In addition, my PhD researched the outcomes and impacts of community owned renewable energy in small regional community in Australia and Scotland.

In drawing on this knowledge and experience, I have every confidence that the ALPA Bill can catalyse significant and lasting value for government, communities and the broader renewable energy transition. We're excited for what this could mean for Australian communities. We all know we're at the edge of transformative changes in our energy supply. Communities are poised and motivated to participate; however, they currently face barriers, as we've heard today. The hubs, we believe, help to overcome these barriers and to unlock that local ambition and local resources.

Yes, we need large-scale renewable energy projects. However, there's also a recognition, as we've heard today, that large-scale renewable energy development does not automatically or necessarily bring benefits to local communities—certainly not to the same degree as community owned projects. Academic research has found that the economic benefits derived from community energy is 1.5 to seven times greater than corporate owned projects. In addition, large-scale renewable energy projects can face opposition, and this can cause expensive delays or cause projects to be abandoned. Building a social licence for renewable energy and associated transmission networks is a crucial piece of work right now, and community energy offers an opportunity to expand that social licence through the active involvement of people on the ground in renewable energy. We know—and academic research proven—that, where communities are directly involved in the process of project development and where they benefit directly from the outcome, they are more likely to be actively supportive of renewables. This is one reason why we believe offering opportunities for communities to invest in large-scale projects is a good idea.

I had the luck of being able to go and visit Denmark over in Europe. They've introduced a policy of offering 20 per cent investment to local communities in all large-scale developments. I heard a story while I was over there that not only had this really helped to increase the social licence for large-scale projects; it also contributed dramatically to local economies. I heard from one local stakeholder that, when a near-shore wind farm offered shares in their project, it was taken up by local community members within two days. So I think that, while there might need to be some consultation about how that opportunity is delivered, we do definitely support it in principle.

In terms of the concept of local power hubs, internationally community power hubs have proven to be a very effective model. In Scotland, for example, five hubs catalysed over 500 community energy projects in a very short period of time. They also facilitated a national network of shared learning and peer-to-peer learning. For example, in Orkney I saw how four neighbouring islands were able to be supported by their hub to install one 900-kilowatt wind turbine each. The hub helped these groups to access the financial, legal, technical and policy advice they needed to get their projects up and running. The hub also provided crucial seed funding. The community groups themselves put in the hours. They organised their communities. They ran good engagement. Through the process, they developed a vast range of skills, which boosted their confidence to go on and tackle other important issues in their local community. Now these islands are working with their local hub and with their local government to trial innovative community-scale hydrogen generation and use the hydrogen to power local farm equipment and public transport. The regional development and local economic impacts these projects had has been a real turning point for them and has helped their communities to stay viable and to combat rural decline. In Victoria, similarly, we heard today that the community power hubs have proved tremendously beneficial, generating significant technical, social, environmental and economic outcomes.

Australian communities are sitting on a vast potential for renewable energy and we have an interest to provide pathways so that these assets can bring lasting benefit to everyday Australians. We believe that ALPA would be a great way to facilitate this. Community Power Agency have worked with over 60 local community energy groups across Australia over the last 10 years and their experience has been that the ARENA and the CEFC funding is often inaccessible to them because they are not a microgrid or because their model is not innovative enough or because their funding need is too small or too bespoke, or because the application process is too onerous or unsuited to the type of organisation and the type of support they need. This is not to discount the important work of ARENA and the CEFC but rather to say they have not been set up to address the unique needs and challenges of community energy. The ALPA bill would be able to tailor an approach and develop a way of working that understands and knows how to support the small and bespoke nature of community energy.

A strong renewable sector is a diversified one. Australia has had household-level programs and we have programs targeting large-scale projects and big industry. The mid scale, the community based sector, is a missing piece in Australia and it's this piece that ALPA addresses. Through providing a trusted local broker through the hubs and enabling financial support, we believe that this bill could unlock opportunities for communities to participate and to really benefit, while also supporting the broader social licence for large-scale renewables development.

CHAIR: Going to Sustainability Victoria and City of Greater Bendigo, the community power projects like those that would be supported by this bill. For those types of projects today and historically, what has been the support from state government and local council, in your experience? How has that mix worked? I know, for example, Councillor, you mentioned PPPs, but I'm interested really in the state and council at this stage.

Ms Ferres Miles : It's been a very productive relationship between the state government, local governments and community groups in terms of the trifecta of the three. In some ways, you could say that the appetite of local governments and councils is representative of the community they serve. I'm sure Jennifer can speak to this but in Bendigo they had a very strong, active and effective Bendigo sustainability group that Sustainability Victoria worked with, and that was supported by the state and both the local governments, so it was a very effective model. The only caveat, I would say, is we've adapted the new program for the issue of volunteer burnout in the community so there is a need for it. In the community power hubs in Victoria, the state government has funded staff to be employed in the not-for-profit community groups alongside state government staff and alongside local government staff to provide that governance, technical support to community members and to build community capability to deliver these projects.

Dr Alden : To follow on the Jarra's point about community, with our initial installations of solar proper, prior to 2017, we had 45 kilowatts of solar powered PV on six separate council buildings and they were managed by communities' committees of management, so they paid for their own utility costs. One example that springs to mind was the Eaglehawk badminton and table tennis centre. It allowed them to recoup 60 per cent of their costs and 40 per cent went to the Bendigo sustainability group, so that is just such a wonderful example of that sort of partnership at that level. Obviously the infrastructure for that is owned by the council. And then there's been some large installations on our library, the tramway depot, the discovery science centre, the archive centre. They were all initial partnership projects, and the success of those has led to further investigation of these other models, as I've mentioned, which were around the Power it from the Rooftop project, the project with MRIT and also the renewable energy community transition, to get the larger scale buy in with all suitable homes and businesses. So we know we can do this and that's a matter of scale that that financial support would enable. We talk about volunteer burnout and it's actually very important, particularly post COVID.

CHAIR: This might be a question on notice if you don't have it with you, which is fine. If you take even the last three years of the community power projects the city has undertaken, what would be their total value collectively from a capital expense point of view? And how much of that capex contribution came from council, state, private sectors?

Dr Alden : I have a table in front of me that probably provides all that but it's broken down, so I'm probably going have to provide that to you separately, if that's okay.

CHAIR: Yes, that's okay. Is the national government best placed to be coming in on this scheme?

Dr Alden : In my opinion, yes, because obviously the authorising environment that a national Australian local power agency, for example, would have required that level of commitment. I think that's the way to advance all of this that we know is poised, ready and waiting on scale that's sufficient to achieve the outcomes we need to rapidly address our climate challenges.

CHAIR: Ms Ferres Miles, did you have something further to say?

Ms Ferres Miles : I was just going to add one further comment to that question. There are benefits in all three levels of government working together. It stretches the government investment further and it also provides absolute equity across all communities across the country. At the moment there may be community groups in other parts of Australia that may not have investment from the state or the local government, so it could provide opportunities there.

Ms STEGGALL: Following on that last comment—probably these are questions to the group—what kinds of preconditions do you think there need to be to make community energy projects successful? And in essence, would a federal body like the one proposed in this bill assist that? Because I guess the converse question is: what is there at the moment? Is there a vacuum of assistance to coordinate and assist communities to do this?

Dr Hicks : Thank you for the question. For community energy groups on the ground, it can be very difficult to access the right advice. Obviously, if you go to advisers in the corporate sector, they are used to advising on very large projects and their costs are often prohibitive. So it can be difficult to access the type of specific legal advice that is needed for a community energy project. My organisation is a not-for-profit but we work under a consultancy model. We do our best to support as many groups as we can. But as with Energetic Communities' experience, it's very hard for us to provide enough support to all of the inquiries that we get. A federal approach to supporting 50 local community power hubs across the country would be highly effective. I do think we need national-level coordination to facilitate knowledge sharing and peer-to-peer learning and to provide the framework to support those hubs on the ground. It's very important to have those 50 community power hubs in communities that are able to operate and build those relationships at a local level and know how that local community operates. It needs to be tailored to the local environment. The ALPA bill proposes a really good mix of federal coordination with local level delivery.

CHAIR: Thank you, Dr Hicks.

Ms STEGGALL: I just have one more, Chair, if I could?

CHAIR: Go ahead, Ms Steggall.

Ms STEGGALL: To Sustainability Victoria: in your view do community energy projects meet a need in these communities that the larger more traditional generation can't? We certainly put this earlier and there is a lot of talk that we're moving towards needing community-based microgrids, development of renewable backed with batteries—uptake of all these. Do you see that these community energy projects, in combination with community battery storage, meet the needs that that larger traditional generation can't?

Ms Ferres Miles : Thank you for the question. Unequivocally, yes. I see it as absolutely complementary to the larger-scale private sector led projects that are core to the energy resilience of our grid. So I don't think it's an either/or question. I think you need both, which was picked up in the evaluation report for the community power hubs. We need a decade of action, which, as I said in my opening remarks, requires every member of the community to think, behave and act differently. By being involved in the community energy projects there are added benefits—people feel more empowered that their actions are achieving outcomes in the place that they live and they work. That also cascades to them feeling more empowered to get involved in other initiatives that contribute to direct climate action. There are multiplying effects for community members to be involved in projects that they can get involved in, in feasibility, in funding and in delivery. We've seen this across all hubs—a lot of community groups are in council owned buildings and they're required to manage those buildings. So there is a direct financial benefit as well in terms of building renewable energy. It's a common purpose for the groups to work together on. They feel more positive that they are taking direct action.

CHAIR: Mr Wilson?

Mr JOSH WILSON: Thank you, Chair. My first question is to Dr Hicks. One of the things that these bills seek to do is require that where there are large-scale, renewable projects there's the opportunity for equity participation by the community. I'm interested in your views about if that were required, either the way that the bills do or through some other method, how do you really make sure that you get the most equitable participation? There'll be some situations where you might throw open participation to those who would be prepared to be community investors. Logic would say that the people who will be the investors are those who are in a better socioeconomic or financial position within the community, whereas those who aren't able will be kind of held out from that. I'm interested in your view on how you make sure that where there's community equity participation it is as equitable possible, including people from low income backgrounds and other sectors of the community?

Dr Hicks : Yes, I think it's a very good consideration. One thing that can be done and has been done with projects that have offered community investment to date is that you keep the entry-level investment as low as is administratively viable. Obviously you can't have people investing $20. That's not going to be administratively viable. But, for example, having the minimum investment at $500 or $1,000 would enable participation from more community members. I think that that's one thing. I think the other thing is thinking about how the share offer is made. So making sure that the communications and the engagement around the offering are accessible to people. So not assuming that people read online media, making sure there are opportunities for face to face forums where people can ask questions, thinking about how you're going to engage with hard to reach communities in the process of making the offering. I also think that prioritising the community in the immediate vicinity of the project—within 30 kilometres first, but then maybe sending that net a little broader to the local government area within a 100-kilometre radius—might be another way to broaden the impact of people who are able to participate in the scheme.

Finally, I would say that a local investment offering would not be the only way a corporate renewable energy project would bring benefits to a local community. That corporate project might still offer its own benefit programs, such as grants or scholarships. In thinking about how it offers benefits in a comprehensive way, it could target disadvantage through those other mechanisms.

Mr JOSH WILSON: I have some quick questions for Sustainability Victoria. We've heard that one of the issues with ARENA is that its focus is mainly on providing grant funding to what amounts to novel technology, where some of the community based energy projects are not so much about novel technology; they're about novel ownership arrangements. Has part of the Victorian government's logic around supporting projects with grant funding like Hepburn Wind been more around that novel community participation structure? That's question 1. Question 2 is: With your sustainable communities program, do you have some sort of metric that allows you to look at the return to the community over time from these projects through reduced power costs, reduced pollution, and some sort of economic return? Is there some metric that's looking at the community dividend broadly from that program?

Ms Ferres Miles : Thank you for the question. I'll start with the first part. This was very much one of the key learnings from our pilot program that we adapted for our current program, to look at an innovative finance mechanism. It was also in response to a parliamentary inquiry in 2017 about the Victorian government explicitly having a recommendation to replace grant funding with a loan fund and looking at opportunities to explore. This wasn't like ARENA. It was different to ARENA. It wasn't based on technology. The loan was very much around how to support community groups to get financial viability to get these projects funded. So, a lot of the time, community groups would be able to get some of the funding through a diverse range of ownership or investment. But this was a way of getting the final amount to get these projects financially viable so that they could proceed. It's set up so that there's a minimum amount of $50,000 that groups can secure in a loan. There's no maximum amount that they can apply for. They're negotiated on a rolling basis, and they have five years to repay it. It's very much seed funding to effectively do the final bit to get these projects across the line so that they can be delivered. That's the way we've set it up. Again, probably building on the previous question, we see this as complementary to ARENA. It's a different model, but I think both of them are equally valid.

In terms of metrics or measurement of impact, I would probably pick up on a comment that I think Dr Hicks made. These projects need to be measured in a different way to large-scale renewable energy projects. As I indicated in my remarks, we've had some measurements around direct and indirect jobs that have been generated. Obviously, there's the standard metrics in terms of how many projects have been delivered, how much renewable energy capacity has been installed, savings on electricity bills.

As I mentioned, we also measure volunteer hours. In our pilot, we had 114 public events and meetings held, 200 businesses were engaged, and we measured 20,000 new connections that were made across community groups—and the hubs very much learnt from each other. So the level of community engagement, I believe, is a measurement in itself. As you've heard from many of the speakers today, we also looked at the economic impacts. That was where we had some fantastic work done in terms of our evaluation, which achieved a conclusion that it was a 13.1 financial leverage. That was very much based on the social return on investment model and a purpose-built quantitative value model developed to assess these types of initiatives. I think there's been great work done, and there's probably more work to be done about how we measure this scale of community impact.

CHAIR: Thank you, Ms Ferres Miles. Although we're pretty much out of time, I wonder if everybody here is happy just to go for another five minutes. From the committee's end, we're not up against another group of witnesses; rather, we'll be eating into our lunch break—mind the pun. Is everyone okay with that? In which case, over to you, Dr Haines.

Dr HAINES: I'd like to speak further to Ms Ferres Miles about this evaluation, because I think it's really, really important what you're telling us about the return on investment for this community hub model. You just touched on jobs. In regional Australia, we're always looking for new ways to engage with young people and for new opportunities for both skilled and unskilled jobs. I wonder if you could tell us a bit more about your evaluation and your experience—and maybe it's also something Dr Hicks could speak to—around the generation of local jobs.

Ms Ferres Miles : Thank you for the question. I would just draw your attention to some comments I made. In our pilot we generated six direct and 16 indirect jobs, but the key learning was that this was unsustainable in terms of volunteer hours. We really needed to invest more money to fund regional roles in the backbone organisation—the lead, not-for-profit organisation. For our current program, which has seven community power hubs, there are 37 direct jobs and 71 indirect jobs being generated by the program, alongside some Victorian government funded staff. So we believe that our current program is striking a much more sustainable balance of expertise, volunteered time and funded roles.

It's been exciting just recently to see the seven sustainability groups across Victoria advertising all of these fantastic new jobs in their communities. We've heard anecdotally that there's been huge interest, high uptake and—particularly in our current context—some excitement that there are some really exciting jobs for people to apply for their local companies.

Dr Hicks : I would just add the flow-on economic benefits. Because community energy projects are very embedded in their local communities, they're using, as much as possible, local suppliers and local contractors to deliver their projects. That's not always the case, and it's not always possible with large projects. I think that's another aspect in which there are some direct jobs but also some indirect jobs.

Dr HAINES: Thank you so much. I have one final question, for Dr Alden. It's extraordinary: you said before that the work that you're doing in your community, through your local government, is returning around $200 million dollars per year back into your local community, through local generation of energy—

Dr Alden : No, not quite, Helen. It was actually that over $200 million leaves our municipality each year in electricity bills. Our aspiration is to retain that money in our community, with the locally owned renewable energy system.

Dr HAINES: Yes. Thank you. I think that's a really important point, actually. And thank you—I slipped in the way I framed that. Two hundred million dollars per year exiting a rural community is an extraordinary amount of money. What change would retaining that money make to Bendigo? Where do you think that money would be spent locally if it wasn't leaving?

Dr Alden : It filters down into all of those different groups. We've talked about some of the groups that have been able to benefit, and then that filters into those people being able to offer more for activities in the community—if it's a recreation centre, for example. But it also allows for that equity lens to come in, for people who are in social housing. There was a small experimental project, a crowdfunded project with the BSG, and that was for solar PV on social housing. That was very, very successful. So, therefore, we've got the health and environmental benefits, for people who have been able to benefit from those, and obviously there's a warming climate and issues there that we need to be really aware of, so that equity lens is really, really important.

The money will benefit people from a range of businesses as well, of course. Obviously people need to be trained, so there are opportunities there for training organisations to upskill a workforce and then for people to benefit as that money adds value to all our other businesses in the community.

CHAIR: Thank you very much, Councillor, and thank you, Dr Haines. Ladies and gentlemen, we'll draw this to a close. Thank you for your attendance today. If you have been asked to provide any additional information, please forward it to the secretariat. If the committee has any additional questions, on notice, for your response, we'll send them to you via the secretariat. You'll be sent a copy of the transcript of your evidence and will have an opportunity to request corrections to transcription errors. Thank you very much.

Proceed ings suspended from 13:15 to 13 : 51