Retail giants unite to secure renewable power deal with CleanCo

The four retailers, part of the Perth-based Wesfarmers conglomerate, announced on Thursday they had inked a renewable power purchase agreement (PPA) with state-owned renewables company CleanCo to power 147 sites across Queensland with wind and solar energy.

Renewable electricity will be provided primarily from the 400MW Western Downs Green Power Hub being developed near Chinchilla in Queensland’s Western Downs region by French renewables and storage developer Neoen.

Neoen says the solar farm, the largest either built or under construction in Australia, is scheduled to come online in late 2022.

The PPA will also utilise wind energy sourced from the 1,026MW MacIntyre Wind Farm being built by Spanish renewables developer Acciona Energia near Warwick on the Southern Downs. The wind farm is expected to be operational in 2024.

Wesfarmers said its retail divisions had joined forces to work with CleanCo to structure a unique arrangement that allowed them to contract separately while leveraging their combined energy loads, demand profiles and number of sites. The PPA includes 31 Kmart stores, 16 Target, 28 Officeworks and 61 Bunnings Queensland stores.

The participating stores will use a combined ~140,000MWh of renewable energy each year by mid-2025, following a staggered onboarding of sites starting July 2022. This is equivalent to the energy consumption of approximately 23,000 Australian households each year.

Wesfarmers said the new partnership is a step towards all four retailers sourcing 100% renewable electricity by 2025, and supporting each retailer’s achievement of net zero Scope 1 and 2 emissions by 2030.

“The approach is consistent with the retailers’ approach of investing in energy efficiency initiatives to reduce usage in the first instance, installing onsite solar generation and storage where feasible, and sourcing the balance of needs from large-scale renewable electricity generation,” the company said.

Bunnings Group managing director Michael Schneider said the PPA builds on the work the hardware giant has already done to increase its renewable power use by installing solar PV systems at 88 sites across Australia.

“While we’ve made positive headway, we recognise we have a lot more to do in this space, and we look forward to pursuing more initiatives to reduce our footprint,” he said.

The announcement of the PPA comes after CleanCo last year signed an offtake agreement with Neoen to purchase the majority of the output from the Western Downs Green Energy Hub. CleanCo agreed to purchase 352MWp of the project’s 460MWp capacity.

Since then, CleanCo has signed a string of PPAs, including a 10-year agreement to supply supermarket giant Coles with more than 90% of its Queensland energy requirements. Australian mining giant BHP has also signed a five-year PPA with CleanCo as it looks to cut emissions from its electricity use at its Queensland coal mines by 50% by 2025.

Queensland Energy Minister Mick de Brenni said the latest PPA further demonstrates the state is making progress on its target of 50% renewable energy by 2030.

“This is proof our publicly-owned CleanCo is getting on with the job of connecting businesses in Queensland to clean, reliable energy from Queensland renewables and helping decarbonise our economy,” he said.

“They join CleanCo’s growing portfolio of partners, leading to further opportunity for our publicly owned renewables, low-emissions, and hydro business, to now grow its footprint of built, owned and operated assets.”

Greenpeace Australia Pacific REenergise campaign director Lindsay Soutar welcomed Wesfarmers’ PPA announcement but called on the retailers to cut deals to meet their 100% renewable electricity commitments in other states by 2025.

“Kmart, Bunnings, Target and Officeworks combined are Australia’s 33rd largest electricity user,” she said.

“Making the switch to clean power in Queensland will make a big dent in Australia’s emissions and bring even more clean, reliable renewable power into our energy mix.

“Ending reliance on fossil fuels like coal and switching to renewable energy is critical for tackling climate change, and these companies are showing how it can be done.”