Energy efficiency

Local Government Finance Program

CEFC Local Government Finance Program

The Clean Energy Finance Corporation is offering Australian councils access to tailored finance to help them invest in a range of clean energy technologies which will reduce energy costs while lowering emissions.

The $250 million CEFC Local Government Finance Program is designed to provide flexible and competitive fixed-rate, long-term finance tailored to the needs of Australian councils.

The program is targeting major investment projects with the potential to make a significant difference to a council’s energy consumption.

Program highlights

Key elements of the program include:

  • Finance for eligible projects across renewable energy, energy efficiency and low emissions technologies
  • Loans of at least $10 million for a single project or package of works
  • Finance can be drawn over three years
  • Ability for multiple councils to enter into joint financing agreements for eligible projects
  • Access to competitive fixed-rate longer-dated senior debt, up to 10 years
  • A straightforward approval process with simple loan documentation.

CEFC and local government

The CEFC recognises there are compelling reasons for Australian councils to take proactive steps to manage their energy use.

Local governments across Australia administer a vast network of street lights, community centres, libraries, sport and recreation facilities and other public access buildings. At the same time, they are under continued pressure to effectively and efficiently manage their operations – and energy use can represent a significant cost component.

The CEFC has considerable experience working with councils, including a $30 million program of clean energy initiatives to help the City of Melbourne reach its goal of zero net emissions by 2020.

Eligible projects

In the 2012-13 year, Australia’s 560 local councils spent more than $32 billion annually on housing and community amenities, as well as transport and communications infrastructure, according to the Australian Local Government Association.

Eligible projects for the CEFC Local Government Finance Program can include the following:

  • Energy from waste projects – to create an energy source from council waste, reducing both landfill and energy costs
  • Rooftop solar PV on council buildings – to provide a renewable energy source using the council’s own assets
  • Street lighting upgrades – to convert to more efficient LED lighting, which can cut energy costs as well as operation and maintenance costs
  • Building upgrades – to improve energy efficiency through a broad range of options, reducing energy costs
  • Leisure and Aquatic Centres – to systematically address these high energy users, with a combined approach to introduce better heating, ventilation and air conditioning solutions as well as renewable energy sources
  • Electric and low emissions vehicles – to lower council fuel bills at the same time as lowering emissions; can include related infrastructure such as charging stations
  • Other projects can also be considered where they fall within the CEFC’s mandate, which covers renewable energy, energy efficiency and low emissions technologies.

How to secure finance

Councils wishing to secure finance under the CEFC Local Government Finance Program can email our local government team: localgovernment@cleanenergyfinancecorp.com.au

We will email you a Confidentiality Deed and an Expression of Interest (EOI) document.

The EOI will ask you for details about your council, as well as a summary of your project(s), indicative project milestones and basic financial information.

 

More information

FAQs for Local Government 

1. How will clean energy initiatives qualify for the Loan Program?

Projects will need to meet the CEFC investment mandate, with investment in:

  • Renewable energy
  • Energy efficiency  
  • Low emissions technologies

The total cost of a project (either single or a package of works) will need to be greater than $10 million, and finance may be drawn over three years. Multiple councils may enter into joint financing agreements that meet this threshold.

 

2. What are some of the types of projects that may be financed by a CEFC loan?

Some of the types of projects that can help councils reduce their energy costs and greenhouse gas emissions and would qualify for the CEFC loan are:

  • Energy from waste projects – to create an energy source from council waste, reducing both landfill and energy costs
  • Rooftop solar PV on council buildings – to provide a renewable energy source using the council’s own assets
  • Street lighting upgrades – to convert to more efficient LED lighting, which can cut energy costs as well as operation and maintenance costs
  • Building upgrades – to lift energy efficiency through a broad range of options, reducing energy costs
  • Leisure and Aquatic Centres – to systematically address these high energy users, with a combined approach to introduce better heating, ventilation and air conditioning solutions as well as renewable energy sources
  • Electric and low emissions vehicles – to lower council fuel bills at the same time as lowering emissions; can include related infrastructure such as charging stations
  • Other projects can also be considered where they fall within the CEFC’s mandate, which covers renewable energy, energy efficiency and low emissions technologies.

 

3. Why is the CEFC launching the Local Government Finance Program?

The CEFC recognises that councils are looking for ways to reduce their energy costs as well as their emissions, as an important way of delivering value to ratepayers. While councils are typically high energy uses and have relatively fixed sources of revenue, council business activities and asset bases tend to support renewable energy technologies, energy efficiency upgrades and low emission initiatives.

In a period of historically low interest rates, now is the right time for councils to act to reduce energy costs and lock in the long-term benefits of energy efficiency.

Because these investments lead to lower energy use, councils can reduce their ongoing operating costs. These savings may be sufficient for councils to repay the loan without impacting their net cash flows.

The CEFC financing package allows Councils to:

  • Access a $250 million finance package specifically for the Local Government Sector
  • Take advantage of historically low fixed interest rates to finance capital works
  • Take advantage of longer debt tenors which are matched to the underlying project
  • Reduce council annual energy costs and carbon emissions
  • Access finance facilities tailored to the needs of an individual council; and
  • Enter into joint financing agreements with multiple councils to deliver eligible projects for the region.

 

4. How does my council apply for a CEFC loan?

Please send an email with your contact information to localGovernment@cleanenergyfinancecorp.com.au.

The EOI will ask you for details about your council, as well as a summary of your project(s), indicative project milestones and basic financial information.

 

5. How will my application be assessed?

Applications will be assessed to ensure they meet the CEFC’s investment mandate and requirements of the Local Government Finance Program.

All investment proposals are assessed by the CEFC in accordance with our Investment Policies.

The CEFC will keep councils up-to-date with the progress of our internal evaluation process. Councils whose projects satisfy the CEFC’s investment criteria will be advised as soon as possible.

 

6. How long is the application process expected to take?

The CEFC has a straightforward approval process and simple loan documentation to support the Local Government Finance Program.

If the timeframes to finalise the loan will vary, the CEFC will advise Councils of the expected timeframes throughout the process. Typically, a 3-4 month period from initial assessment to final contracts would be a reasonable assumption.

 

7. How will interactions between Local Government representatives and the CEFC be managed?

Most interaction will be by email and phone. Some face-to-face meetings are likely, and the CEFC is flexible as to the location that works best for each Council. The CEFC also uses video-conferencing facilities where possible.

 

8. My council has a program of works to deliver various clean energy initiatives with a total cost less than $10 million. Can my council participate in the CEFC Local Government Finance Program?

The CEFC Local Government Finance Program is designed for a single project or package of works with a total cost over $10 million.

Alternatively, a group of Councils may join together to combine projects to reach the $10 million project size. The CEFC is willing to discuss loan arrangements to a group of councils where it is appropriate and the group of councils are willing to enter into a joint financing agreement.

We encourage councils to contact us about finance needs, and we can help you determine if the Local Government Finance Program is appropriate.

The CEFC has other financing programs which may better suit the needs of an individual council, which we can discuss with you. 

 

9. Can the CEFC support businesses in my Local Government Area?

Yes. The CEFC invests in a wide range of renewable energy, energy efficiency and low emissions technologies with counterparties across business and industry (small, medium, large companies).

The CEFC welcomes project proposals in addition to the Local Government Finance Program. Please contact us via info@cleanenergyfinancecorp.com.au.

Smaller projects may be eligible for CEFC co-financing through our programs with Origin Energy, National Australia Bank, Commonwealth Bank, SunEdison or Firstmac. Please contact one of our program partners or contact us via info@cleanenergyfinancecorp.com.au to discuss your project.

 

10. Where can I get more information about the CEFC Local Government Finance Program?

For all enquiries about the CEFC Local Government Finance Program, or to request a meeting with the CEFC Local Government team, please email localGovernment@cleanenergyfinancecorp.com.au

Subscribe to news and updates

Contact




    Highlights

  • Westpac and the CEFC are working together on a $200 million program for Australian businesses offering low-cost finance for solar, energy efficient technologies and low emissions vehicles. Read more

  • Solar panel

    The CEFC is committing up to $20 million in cornerstone debt finance for a large-scale solar farm near the historic Central Queensland town of Barcaldine. Read more 

  • Crowd of people

    The Clean Energy Finance Corporation has established a $250 million loan program to support Australian councils to invest in clean energy technologies. Read more

  • Biodigester

    The CEFC’s Paul McCartney discussed the future of bioenergy at the Australian Bioenergy Conference on 30 November. Read more