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Charter Hall Group (ASX: CHC) has secured a new agreement that will see a key part of its $60 billion property asset portfolio powered by renewables over the next seven years following the latest major corporate contract secured in Australia by global giant Engie Group.
Under the deal, Charter Hall will buy 151GWh of renewable energy a year from wind and solar farms - enough to power about 26,000 average homes - to be used across 152 office, retail and industrial properties over which the group has direct operational control. The agreement is poised to collectively reduce carbon emissions by 70 per cent on those sites once it becomes active in 2024.
The energy will be sourced initially from Engie’s Willogoleche Wind Farm in South Australia and Woolooga Solar Farm in Queensland, with other renewable energy generators yet to be announced.
“We are leveraging our platform-wide scale and Engie’s world-leading renewable power capacity to unlock value and secure competitively priced, renewable electricity,” says Charter Hall’s CEO David Harrison.
“This will deliver long-term benefits and mutual success to our partners, customers, communities and the planet.”
The supply agreement with Engie takes Charter Hall a step closer to its target of having 100 per cent of the properties over which it has operational control supplied by renewable energy by 2025. This is expected to occur once Charter Hall integrates the power supply from onsite solar initiatives across its retail assets, which are among the portfolio’s most energy hungry properties.
While Charter Hall has more than 1,300 properties across its group portfolio, tenants have ultimate control over their power supply agreements. However, Charter Hall is understood to be actively working on bolstering the performance of its downstream emissions by seeking out partnerships with tenants to encourage the take-up of renewable power across the balance of its portfolio.
Harrison says the Engie partnership will ensure Charter Hall ‘remains on track to reach net zero carbon in operation on or before 2030’.
“Our investment in procurement of renewable electricity will assist Australia’s transition to a low-carbon economy and accelerate the industry’s growth and potential to secure new and improved renewable technologies, to benefit generations to come,” he says.
The power supply agreement with Charter Hall comes on the heels of Engie securing similar deals with some of Australia’s largest companies, including Coles Group (ASX: COL) and National Australia Bank (ASX: NAB), over the past two years.
Engie is global utility provider based in France with extensive interests in renewable energy, especially in Europe. It also operates in conventional fields of power generation such as natural gas.
Apart from solar and wind farm interests in Australia, Engie has also partnered with Macquarie Group's (ASX: MQG) Green Investment Group and US-based energy storage group Fluence to deliver Australia's largest privately funded and owned utility-scale batteryon the site of the former Hazelwood Power Station in Victoria’s Latrobe Valley.
Engie Australia and New Zealand CEO Andrew Hyland says agreements such as the latest secured with Charter Hall were vital to support investment in new, renewable energy capacity.
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