Another piece of the puzzle: Energy cop and VicGrid boss explain new rules for renewable energy developers

If wind, solar, battery and hydro developers want to build major projects in Victoria and access the state’s electricity grid they need to engage early, be transparent and leave communities better off.

That’s according to new guidelines released by the state government this week, following the finalisation of renewable energy zones, three of which are in western Victoria.

The response: Local farmer David Clark, who helped establish the community benefit fund associated with the Waubra Wind Farm two decades ago, said the new rules will mean western Victoria finally “gets some consistency”.

CEO of VicGrid, Alistair Parker, told the Brolga every expectation within the guidelines could be traced back to issues raised directly by communities, councils and landholders.

🗣️ “I kind of think of it under three headings: treat people with respect and in an open and transparent way, give people the information they need, and make sure you've got a proper scheme to share benefits with the wider community,” he said.

What were the issues? Questions around non-disclosure agreements, decommissioning responsibilities and insurance liability have consistently been among the issues West Vic residents have sought clarity on.

The fixes: VicGrid’s new guidelines specifically address these issues. Developers are expected to avoid contractual clauses that “unreasonably restrict” landholders from discussing projects with their neighbours.

• The guidelines also require developers to provide financial support for independent legal and financial advice, and clarify who is responsible for costs such as insurance.

• New expectations around insurance have been introduced, requiring developers to ensure farmers hosting projects, or their neighbours, are not left exposed to increased public liability risks because of renewable energy infrastructure.

• Landholder agreements will also require developers to assure how projects would be decommissioned if the company was to “go bust”. 

🗣️ “They could have a trust or some sort of sinking fund that will actually deal with decommissioning,” Parker said.

How will they be enforced? The new standards will be tied directly to developers’ ability to connect to Victoria’s transmission network.

• Initially, compliance will be enforced through connection agreements. Longer term, developers seeking access to the grid will need to demonstrate they are meeting the expectations.

🗣️ “There would be penalties if they didn't, but then in the extreme case they just wouldn't be able to get access to the network,” Parker said.

Accountability a must: The focus on accountability has been welcomed by Australian Energy Infrastructure Commissioner Tony Mahar, whose office regularly deals with complaints and concerns from communities hosting major energy projects.

• Mahar said many of the issues addressed in the guidelines reflected concerns being raised directly with his office. He told the Brolga the success of any engagement process came down to trust, relationships and genuine communication.

🗣️ “Providing clear and balanced context, so people fully understand what is being proposed,” he said. “Genuine engagement - being present in the community, having face-to-face conversations and building relationships, rather than relying solely on emails or letterbox drops.”

A standard for engaging with locals: Mahar said the guidelines would provide greater clarity about what good engagement should look like.

🗣️ “Accountability can be the energy sector’s best friend and I think the guidelines are a valuable contribution to the discussion,” he said.

Keeping money local: The Waubra Wind Farm fund is one of the earliest examples of a renewable energy project sharing benefit funding with its host community.

David Clark believes the most important role local communities had in the rollout of the guidelines was ensuring the money from community benefit funds was “for the community to control”.

🗣️ “It's really important that the community actually has effectively the final say in where the money goes,” he said. “You've got the money for 25 years, you really should be planning some really big changes in your community.”

🗣️ “If you don't use this money to transform your community for the better ... you've missed the opportunity.”