CCL 15/12/09 - SMART GRID SMART CITY

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1 ITEM-148 CCL 15/12/09 - SMART GRID SMART CITY STRATEGIC THEME: ENVIRONMENT REPORT BY: FUTURE CITY CONTACT: JUDY JAEGER / PETER DORMAND TELEPHONE: / PURPOSE 1 In the May 2009 Federal Budget, the Australian Government announced that it would invest up to $100 million to develop a commercial scale smart electricity grid demonstration project in partnership with the energy sector. Smart Grid Smart City (SGSC) grant applications opened in October this year and will close 28 January The purpose of this report is to seek Council endorsement for the EnergyAustralia led SGSC submission to the Commonwealth Government. The report is also seeking endorsement to participate in a related project with the electric vehicle infrastructure organisation Better Place Australia. RECOMMENDATION 2 Council partner with EnergyAustralia through its Smart Grid Smart City bidding team and contribute to the tender writing process that concludes 28 January Council provide EnergyAustralia with a letter of support for the SGSC application to the Commonwealth Government. 4 Council engage Better Place Australia to undertake a local case study that will explore the options of piloting Electric Vehicle infrastructure in the Newcastle region and this work be undertaken in collaboration with Lake Macquarie City Council. KEY ISSUES 5 Newcastle City Council undertook extensive consultation with the State Government to encourage financial and political support for a Newcastle based SGSC initiative. The NSW Government has established a Smart Grid Smart City task force to assist NSW based bids and to provide limited funding to assist in the application process. 6 A successful $100 million SGSC bid has the potential to firmly position Newcastle as the Australian Capital of the sustainable energy industry. EnergyAustralia is recognised internationally for its advanced application of intelligent energy grid technology. 7 The Smart Grid initiative in Boulder Colorado in the US determined that technology alone does not provide the best outcome. The Commonwealth Government is seeking a bid that works more closely with the local community hence the inclusion of Smart City in the name Smart Grid Smart City

2 8 Council has worked together with the relevant stakeholders over the past five years to assist our local community to achieve measurable environmental improvements. This has resulted in the formation and incorporation of the Together Today Cooperative. 9 Council has recently established a strong link with the University of Newcastle s Centre for Intelligent Energy Networks with the view to integrating this research work into the City s new Climate Action Plan. 10 Newcastle is the only city in the world that reports incremental electricity consumption data for its entire community via the award winning ClimateCam system and related action learning programs. University of Newcastle is home to the EnergyAustralia funded Centre for Intelligent Electricity Networks (CEIN) and the Commonwealth s Clean Energy Connect Centre. The CSIRO Energy Technology Centre at Mayfield is also the headquarters of the National Solar Institute and Energy Technology Flagship. 11 Electric vehicles are highlighted in the SGSC guidelines as a key element of all bids. The Better Place Australia organisation is seeking to establish five pilot electric vehicle recharging and battery switch out infrastructure projects in Australia and has invited Newcastle to participate in a scoping study and case study. Lake Macquarie City Council has demonstrated a strong interest to work with Council and to co-fund the Better Place Australia case studies. FINANCIAL IMPACT 12 If Council elects to pursue the project, the financial impact can be broken into three discrete elements. a) Bid Preparation; b) Successful $100 million Grant process; c) Better Place Case Study: a) Bid Preparation Council s Environment & Climate Change Services Manager and Team will work with EnergyAustralia s bid development team up until the deadline of 28 January. b) Successful $100 million Grant - The full impact to Council will not be fully understood until the tender bid has been finalized. It is the intention that COUNCIL will not occur a financial loss by being involved. c) Better Place Australia Case Study the development of the Better Place electric motor vehicle case study has a funding requirement or $15,000 for Council alone or $9,500 for Council and $9,500 for Lake Macquarie City Council if both Councils work together on the project. Council has existing funds in its Carbon Foot-printing budget allocation that could be redirected toward the $9,500 option.

3 IMPLEMENTATION PLAN/IMPLICATIONS 13 The Management Plan comprises of four Key Focus Areas one of which is Environmental Enhancement with the objective to ensure Newcastle has an environmentally sustainable future and this is underpinned with specific priorities, and strategic outcomes that include energy efficiency and integrated transport. There are considerable economic development outcomes that could also be achieved through the National demonstration and mainstreaming of the Smart Grid Smart City initiative in the City of Newcastle. RISK ASSESSMENT AND MITIGATION 14 The City of Newcastle has worked consistently over the past decade to establish itself as an international testing ground and innovator for sustainable energy technology and services. The international focus on the effects of a changing climate and the outcome of the United Nations COP 15 Climate Summit in Copenhagen will only strengthen the demand for large scale solutions at the City level. The involvement with EnergyAustralia in a successful SGSC bid has the potential for long term economic growth in this region. 15 It is likely that there will be between four and ten cities bidding for the $100 million across Australia. The guidelines make it clear that there will only be one winning bid. RELATED PREVIOUS DECISIONS 16 The Greenhouse Action In Newcastle (GAIN) Plan included specific actions to promote the City as a world class testing ground for community applied resource efficiency technology. The Smart Grid Smart City initiative will assist greatly in the realisation of this targeted action. 17 The recent Climate Change briefing to council highlighted the options for the City to include in its new Climate Action Plan deep and sustainable cuts in greenhouse gas emissions in preparation for a carbon restrained economy. The involvement in a successful SGSC bid will position Newcastle at the forefront of current best practice in this regard. OPTIONS 18 Council partner with EnergyAustralia through its Smart Grid Smart City bidding team and contribute to the tender writing process that concludes 28 January (preferred option) 19 Council provide EnergyAustralia with a letter of support for the SGSC application to the Commonwealth Government. (preferred option) 20 Council does not participate in the EnergyAustralia SGSC initiative. 21 Council does not participate in the Better Place Australia case study.

4 22 Council engage Better Place Australia to undertake a local case study that will explore the options of piloting Electric Vehicle infrastructure in the Newcastle region and this work be undertaken in collaboration with Lake Macquarie City Council. (preferred option) BACKGROUND 23 In the May 2009 Federal Budget, the Australian Government announced that it would invest up to $100 million to develop a commercial scale smart electricity grid demonstration project in partnership with the energy sector. Smart Grid Smart City (SGSC) grant applications opened in October this year and will close 28 January Smart grids are modernised electricity grids that interact with information technology and communications infrastructure to provide greater transparency on energy use to consumers and to improve the quality of energy supply. Smart grids more easily integrate renewable and distributed energy sources into the grid, like solar, wind, co-generation plants and electric vehicles. The commonwealth is offering a grant of up to $100 million to one electricity network provider in Australia to lead a consortium to implement the project over a three year delivery period. EnergyAustralia wrote to Council 19 November advising that it was preparing a bid to the SGSC initiative that would centre its focus largely on the City of Newcastle. EnergyAustralia has invited Newcastle City Council to join their bid as a civic partner and to assist in the bid preparation process. 24 The objectives of the SGSC demonstration project are to: deploy a commercial-scale rollout that tests the business case for key applications and technologies of the smart grid build public and corporate awareness of the economic and environmental benefits of smart grids and obtain buy-in from industry and customers gather robust information and data to inform broader industry adoption of smart grid applications across Australia investigate synergies with other infrastructure (such as gas and water) and the National Broadband Network. 25 Examples of works that may be undertaken include:- Supply and installation of smart grid technology in Newcastle households that will help to reduce energy wastage and peak demand Supply and installation of smart grid technology in Newcastle businesses that will help to reduce energy wastage and peak demand Supply and installation of smart grid technology in Newcastle Schools and education facilities Supply and installation of smart grid technology throughout the local electricity network designed to increase efficiencies and reduce power failures. 26 Council has also been invited to join a related program through the electric vehicle infrastructure company Better Place Australia. Better Place Australia is preparing case studies for the accelerated mass adoption of electric vehicles in Australia as described in the attached letter of invitation.

5 REFERENCES ATTACHMENTS Attachment A: Letter of Invitation from EnergyAustralia Attachment B: Letter of Invitation from Better Place Australia

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