Property Australia

Energy ecosystem evolution

Karen Jamal Karen Jamal August 24, 2021

In the decade of decarbonisation, our energy ecosystem is evolving at a rapid rate. As the property industry innovates, we asked leaders from Goodman Group, Yurika and Real Utilities for their take.

The latest report from the Intergovernmental Panel on Climate Change makes grim reading. The planet could exceed 1.5°C of global warming – the limit for temperature rise outlined in the Paris Agreement – within a decade.

If emissions must peak within a matter of years, the built environment sector – responsible for 40 per cent of global emissions – has a monumental task ahead.

But the energy ecosystem is also evolving rapidly as the way we make, move, store and use energy changes. More than 27 per cent of Australia's energy came from clean sources in 2020. Wind and rooftop solar led the charge, says the Clean Energy Council.

While the large-scale sector contributed almost two gigawatts of new capacity in 2020 as 32 new projects came online, Australian households also installed nearly 23,800 small-scale batteries.

Twenty-six new corporate power purchase agreements were also inked in 2020 by organisations from Aldi to Amazon to the City of Adelaide, directly supporting 4.5 gigawatts of renewable energy generation.

And the Clean Energy Finance Corporation recently announced its single largest investment, with up to $295 million in capital to develop essential grid infrastructure that will unlock renewable energy projects across three states and accelerate the decarbonisation of the National Electricity Market.


Leading the charge

Australia’s property industry has stepped up its pace in the renewables race.

Goodman Group, with nearly $58 billion of assets under management, recently took great strides forward by achieving carbon neutral global operations four years ahead of its 2025 target. The carbon neutral milestone follows a progressive program to install rooftop solar, with around 50 megawatts installed in 2020 alone.

250821 - Story 3 - Greg GoodmanIn addition to net zero operations, Goodman Group’s chief executive officer, Greg Goodman, says his company is looking at sustainable solutions that support customers and investors – and one of those is electric vehicles.

“Electric cars align with our sustainable philosophy and our focus on economic, environmental and social outcomes,” Goodman says.

Australia’s 6,900 sales of EV sales in 2020 were well behind the 1.3 million purchased in the world’s largest EV market, China, last year, according to Electric Vehicle Council. But Goodman says infrastructure to support EVs “has become a fundamental component of warehouse and office carpark design across our portfolio”.

Goodman Group has recently promised that all its new development projects worldwide will feature dedicated EV bays and charging. The Group’s own global vehicle fleet, which is currently hybrid, will be fully electric by 2025.

Meanwhile, a new $10 million incentive will assist Goodman Group’s 900-plus employees to make the shift to EVs. The idea is to not only drive down emissions, but to embed sustainability into Goodman’s culture and values. “We’re committed to providing solutions that reduce emissions and we want to enable our people to make a difference as individuals,” Goodman adds.

250821 - Story 3 - Goodman Group EV charging

Smart solutions

Energy solutions provider Yurika built the world's longest EV superhighway, with a series of fast-charging EV stations stretching from the Gold Coast to Toowoomba and up to Cairns. It’s an impressive achievement – one of multiple projects and tailored customer solutions, that Yurika’s team has rolled out as it helps customers make the energy transition, cut costs and meet emissions targets.

250821 - Story 3 - Carly IrvineYurika, part of Energy Queensland, has many exciting projects on the go, from microgrids to solar farms to virtual power plants. “We are technology agnostic because technology will change rapidly,” explains Yurika’s executive general manager, Carly Irving.

Underpinning the success of every energy solution is data, Irving adds. “The property industry is awash with data. You can flood people with it, but unless they understand how to use it to deliver more sustainable outcomes, it is meaningless.”

Irving and Brad Pye, Yurika’s general manager for metering, have a clear goal: to make energy measurement meaningful. “We are seeing the development industry embrace a lot of technology, but to be effective in the energy space you need that data in real time. You can access this through a smart meter,” explains Pye.

250821 - Story 3 - Brad PyeSmart meters help us unravel and understand the complexity of the energy ecosystem. Twenty years ago, Australia’s energy market was a one-way street with energy flowing from the power station to the customer’s door. Basic metering helped energy companies to bill customers for their consumption but offered little actionable insight.

Today, bidirectional energy flows from both traditional power sources and customer-generated energy sources. Smart metering captures that energy flow across multiple utilities and sites. Spikes in consumption can be investigated in real time, while analytics can spot patterns before they become big problems. And when utility data is overlayed with weather or traffic data, for instance, nuanced insights can deliver better decision making.

“The energy ecosystem is complex. To make sense of it we need the data from smart meters,” Pye adds.


Green for the price of brown

While technological solutions, from blockchain to battery storage, are breaking down the barriers that once prevented property companies from entering the energy arena, Paolo Bevilacqua says “new business models are needed to solve our big problems”.

250821 - Story 3 - Paolo BevilacquaBevilacqua is general manager of Real Utilities, a licensed energy retailer established by Frasers Property Australia nearly five years ago to offer certified carbon neutral energy to its building customers.

Since then, Real Utilities has grown to service 1,500-plus customers across 10 sites, from residential community Ed.Square in Sydney to Burwood Brickworks shopping centre in Melbourne. Real Utilities uses a combination of onsite renewable energy – usually solar panels, large batteries and biodiesel generators – and carbon offsets to provide Climate Active certified carbon neutral energy to customers. Real Utilities has also recently signed a seven-year renewable energy certificate purchase agreement with Origin Energy which will ensure 100 per cent of the energy supplied to customers is matched with Australian renewable energy projects.

“We guarantee that customers won’t pay more than if they purchased electricity from the grid. It’s green for the price of brown,” Bevilacqua says.

Why don’t more property companies become utility companies? Bevilacqua says the barriers to entry are still high. “Licensing requirements are fairly onerous – the processes take time and money. Real estate investment trusts are constrained in terms of how they generate their income, and energy income has a different risk profile.”

While carbon neutrality hasn’t been on every customer’s radar, Bevilacqua expects this to change as “companies understand the cost of carbon to their business”.

Real Utilities has recently expanded into the industrial sector, “which is the most exciting opportunity but also the most difficult,” Bevilacqua says. There is an economy of scale that needs to stack up and some large industrial facilities don’t use that much energy relative to their size, he explains.

As more property companies eliminate emissions from their own operations, Bevilacqua expects a sharpened focus on Scope 3 emissions – those generated by the customer – over the next few years.

Frasers Property sees Real Utilities as a competitive differentiator in a carbon-constrained economy. “We offer a strong value proposition to our customers and can commit to zero carbon in operations on large bids. No other property company can commit to that in a way they can control and manage for the long term,” Bevilacqua notes.

“We are looking to expand, now we've proven the model and understand the value it can bring, we want to partner with other property companies to scale the solution.”

250821 - Story 3 - Ed.Square Aerial