Mildura’s Ritchies IGA Supermarket has become the first business in the Sunraysia region to take advantage of the tenant and landlord benefits of Environmental Upgrade Finance (EUF). Ritchies is one of the largest independent supermarket chains in Australia.
The solar project is a partnership between Ritchies and the owners of the property. While the Landlord owns the installation, the tenant receives the full financial benefit of the project and pays the Environmental Upgrade Charges, a win – win solution for both landlord and Ritchies.
The EUF application process is designed to ensure minimum disruption to the tenant’s day to day business. Upon the tenant and landlord reaching agreement, the landlord initiates the application processes and the tenant signs the forms consenting to paying the charges
A 99kW solar system will be installed at the supermarket, which will produce about 150MWh of electricity – enough to power 22 average-sized homes in Mildura.
“For us it’s great because it helps with the higher price of power, power has gone up almost 15 per cent for us,” Mildura Ritchies IGA store acquisitions and project manager Paul Papson said.
54% of Victorian businesses are tenants, which represents a large opportunity for projects like this to be replicated through tenant and landlord collaboration. James Wark, Business Development Manager, Sustainable Melbourne Fund, said, “If a Landlord finances the project with an EUF the project costs and finance repayments can be shared with the tenant as they receive the financial benefit of the project. The agreement does not require renegotiations of the lease, demonstrating the flexibility and ease with which it can be put in place. This is a model to be replicated to other stores owned by Ritchies, and for other businesses”.
The processes established by BBF and utilised by Ritchies can be easily adapted by Councils and business across municipal and state boundaries.
The EUA market has been growing rapidly in regional Victorian with interests from retail, agricultural and manufacturing businesses. Mr Wark continues “We are seeing enquiries and applications from farmers and large manufactures in regional and rural Victoria for the first time. The product has matured; Environmental Upgrade Finance is now simple and offers good credit terms to a broad range of business types.”