
De-risking energy transition project delivery
Options to help you de-risk project delivery for energy transition investments
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Energy transition
Australia
If Australia is to achieve our net zero targets, we need rapid development of renewable energy alternatives – be that solar, wind, geothermal, hydropower or bioenergy. In addition to investing in renewable energy generation (wind and solar farms), we also need to upgrade or construct transmission and supporting infrastructure so the clean energy produced can be distributed through the National Electricity Market. Across Australia, hundreds of projects need to be approved and built in a short timeframe to achieve the government’s emission reduction targets. Often they will be developed close to one another. And this means we need to talk about cumulative impacts...
When we talk about cumulative impacts – we’re considering the collective impact of all projects happening in a certain area within a set timeframe on the local people, economy and environment. Assessing the impact of a single project doesn’t tell the full story. We need to look at them within the context of what’s happened before, what’s being developed at the same time, and what else is proposed for a certain region, town or patch of ocean.
The interactive maps provided by EnergyCo of New South Wales' Renewable Energy Zones (REZ) are a great demonstration of the volume of development (and therefore consultation) activity going on within relatively concentrated areas. And such maps don't include other infrastructure initiatives like hospitals and transport that might be happening at the same time. All of this adds up to a lot of projects seeking approval, consulting with community groups, conducting surveys, needing supporting infrastructure, utilising roads or ports, requiring accommodation for workers, and changing the landscape.
In the case of renewable energy projects, the community is often supportive of the first project. But as we’re seeing in some areas – by the fourth or fifth proposal, community sentiment can change. If not managed carefully, vital local support can be lost – not just for individual projects, but for all of them. As pointed out by our colleague, Fiona Thompson, in this piece about early engagement for offshore wind, a 2019 Infrastructure Australia paper reported that community opposition contributed to the delay, cancellation or mothballing of more than $20 billion of infrastructure projects in the last decade.
To succeed with our clean energy goals, we need to know who to talk to and to engage early with the diverse groups that make up our many and varied communities, including First Nations’ organisations and Traditional Owners, local residents, business, committees, local government, tourism operators and sporting clubs. The people who will be most impacted by these projects need to be consulted, have an opportunity to provide input and be considered when something’s being built in their backyard, or on their Country.
Engaging with community groups is a regulatory requirement for most projects. That’s a good thing (especially if done well), but it can also lead to engagement fatigue. Since Gippsland was identified as a renewable energy zone and offshore wind declared area, there has been a rush of developers to the region – all needing to engage with the same people.
Other challenges include increased pressure and demand on local resources like roads, accommodation, workers and supplies. It can be a huge disruption, especially as renewable projects are often delivered in remote locations and near small rural communities – in some cases there might only be one road in and out. Visual impact is another challenge – one wind farm might pass, but the risk is that people will view multiple turbines or solar panels as too many on the horizon.
And then there’s the challenge of the unknown. How do you adequately account for the cumulative impacts of renewable projects when the industry is new, where there are uncertainties, and where not all projects go ahead?
On the flip side, there are also the cumulative benefits and opportunities that multiple projects create. There are opportunities to share knowledge, infrastructure, and resources. There are business opportunities for local industry, and people can upskill and benefit from the newly created jobs springing up in their region.
Government authorities and associations are mobilising to prepare communities to make the most of these opportunities. In places like the Latrobe Valley in Gippsland where coal has been an economic driver, the Latrobe Valley Authority is now working with education providers, councils, industry and communities to deliver a benefits sharing working group to create positive outcomes as the area transitions to renewables.
There’s also an opportunity to use the renewables revolution to improve outcomes for disadvantaged groups and ensure communities get more of a share of the economic and social benefits.
To manage benefits as well as challenges – we need a coordinated approach. At the moment, developers have little choice but to reach out to every community group, each and every time. To avoid engagement fatigue, governments or regulators could step in. This is happening in the UK where they have created working groups to coordinate approaches to shared stakeholder groups, address emerging issues and reduce the need for developers to engage every stakeholder on every issue.
A coordinated approach to sharing knowledge would also help. For example, there are overlaps in the environmental survey and assessments being conducted and therefore there’s an opportunity to share intel to save time and resources, as pointed out by our colleague Tamara Al-Hashimi.
The pressure to decarbonise with a new, interconnected renewable energy system presents unique challenges for communities, governments, regulators and developers. In times of rapid change, we need to clearly communicate the why and how. And the community must be brought along for the journey in a meaningful way. They will have valid concerns, but they will also have valuable contributions to make.
If we manage cumulative impacts, there’s enormous potential for social, economic and environmental gains.
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