BlueScope, ESCO and Schneider Electric announce renewable energy PPA

BlueScope Steel, ESCO Pacific and Schneider Electric have announced a renewable energy power purchase agreement (PPA).

The 7-year PPA will see BlueScope offtake 66% of the 133 MW of energy generated from ESCO Pacific’s Finley Solar Farm. The 500,000 solar panel farm to be located at Finley, 100 km west of Albury in the Riverina of NSW, is expected to be online by mid-2019. The ground-mounted solar farm will be located on a 300-hectare site, which is almost half the size of BlueScope’s Port Kembla Steelworks.

The agreement also fixes the power price over the life of the contract, reducing the price for power in the immediate term and providing a long-term buffer against market volatility. Historic ups and downs in the price of Australian electricity have led to considerable and unexpected surges that have left many businesses struggling to manage their energy budgets.

BlueScope’s Chief Executive, Australian Steel Products, John Nowlan, said, “BlueScope’s approach to energy has always been about balancing the ‘Trilemma’, whereby we have access to affordable and reliable energy while reducing emissions where we can — which is why we support the intent of the National Energy Guarantee (NEG).

“This PPA is one of Australia’s largest corporate offtake agreements, and is the largest with a solar farm to date, and complements our firm electricity supply arrangements, which provide the reliable electricity supply we need for manufacturing processes that must operate 24/7. The PPA will help keep downward pressure on our energy costs, and will support the gradual transition to renewable energy. The volume under the agreement is equivalent to 20% of BlueScope’s total Australian electricity purchases.”

Schneider Electric Energy & Sustainability Services (ESS) advised BlueScope Steel on a long-term renewable energy PPA as a strategy to reduce cost in the short term and reduce volatility over the longer term through fixed-price-for-power contracting.

Earlier this year, Schneider Electric ESS launched new services to assist businesses in the adoption of low-cost renewable energy, through power purchase agreements (PPAs) and other projects. Schneider Electric’s Managing Director, Gareth O’Reilly, said, “Australian businesses have been left struggling with inflated energy bills and budgets, with both wholesale electricity and LGC prices more than doubling between 2015 and 2018. Through Schneider Electric’s Energy & Sustainability Advisory Service, we worked closely with BlueScope Steel to identify a long-term renewable energy PPA as a strategy to reduce cost in the short term and reduce volatility over the longer term.”