Author: Martin Daniel
Anthony Vedelago sought out a means by which he could protect his business from rising energy costs. What he found was a way he could achieve this in an environmentally sustainable manner whilst providing immediate benefit to both his tenants and his own business.
Like a lot of businesses, electricity is one of Morayfield Nominees largest ongoing expenses. Rather than just getting a better deal from electrical retailers, Anthony Vedelago, Managing Director of Morayfield Nominees turned to a source of emissions free electricity to offset a portion of the business’ monthly power bill at their multitenant office building in Hamilton QLD. By reducing demand from grid electricity through a Planet Ark Power solar installation Morayfield Nominees was able to save money from day one as well as pass savings onto their tenants. Through the use of a Planet Ark Power financing arrangement the business has been able to install rooftop solar with no upfront capital expenditure. As such, Morayfield Nominees successfully reduced the Hamilton sites monthly energy bill at a time when electricity prices continue to rise.
Morayfield Nominees Hamilton site is a multi-tenanted stand-alone office building. The site contains one electricity meter for which Morayfield is responsible for paying the usage to the sites retailer. From the meter, the usage is then sub-metered to each of six businesses who have tenancies within the building. Therefore, by reducing the grid usage and paying less than the reduction of the grid costs to finance the operating lease, the installation is cash flow positive for Morayfield Nominees. At the same time, each tenant’s individual usage of grid supplied electricity is reduced, thus reducing the monthly bill for each of the tenants within the building saving them money also. The business benefits have been immediate as Anthony explains:
As a commercial landlord, I have quickly seen the benefit of integrating clean energy and efficiency solutions on our properties. It provides our tenants with lower power bills and is a great tenancy incentive to extend leases. The systems are ours after the lease period and a major asset for the building moving forward.
The financing terms see the business paying a monthly repayment on their operating lease that is less than the cost of the energy usage that has been directly offset by the onsite generation. Lease terms may vary depending on a sites specific situations and usages but typically range from 3 to 7 year finance packages. When asked why they decided to go with Planet Ark Powers offering Anthony advises that the financial benefits were very appealing:
As a landlord, I am funding these systems under a financial structure that is cash flow positive from the outset. Planet Ark Power clearly presented those in a simple and clear way that was easy to interpret and share with other decision makers within our organisation. It was a simple process.
With energy prices continuing to rise and some huge jumps coming we felt we needed to establish some security in costs as early as we could. The Planet Ark Power analysis looked pretty good compared to current prices and instilled a lot of confidence in our decision. So with the expected future increases, we thought we’d do well by locking in the cost benefits of solar now.
Martin comes to Planet Ark having worked as an applied materials scientist for ten years and managing a Materials Testing Laboratory for the last seven of this. Having taken a keen interest in renewable energy and climate policy Martin started a Masters in Environmental Science and Law in 2015. Martin now works as the Planet Ark Power Program Manager primarily focused on accelerating the uptake of solar PV in the commercial sector in Australia