Enabling and supporting assets in our infrastructure portfolios to switch to renewable energy sources and improve energy efficiency is a strategy that IFM is implementing globally to increase resilience to climate risk.
An example of this is the large-scale power purchase agreement (PPA) program IFM created to further support assets in our Australian Infrastructure portfolio to procure renewable energy.
Our aim was to create a multi-state, multi-asset solution, where all benefits would flow on to assets via a structure that provided:
Access to renewable energy at below market rates;
The ability to de-risk businesses against future electricity market volatility; and
The opportunity to significantly reduce their greenhouse gas (GHG) emissions, supporting, and in some cases fast-tracking, assets’ existing net zero commitments
With no existing pathway or product in the market to meet our needs, we sought external support to help us develop a solution. During 2021, we engaged with and brought other industry stakeholders into the project, including co-investors, large
tenants of the assets and other large infrastructure owners. QIC, a co-shareholder in some of the assets in our Australian Infrastructure portfolio, and Transurban were two key stakeholders with assets in the program. Our collaborative approach
elevated the project to a wider industry initiative, which helped to create scale and price benefits for all parties, while also supporting the infrastructure industry’s transition to net zero.
Over three stages, the program is expected to facilitate the supply of more than 400 GWh of renewable energy per annum by 2025, saving around 250,000 tonnes of GHG emissions each year.
In early 2022, Stage 1 of the program was completed, with contracts signed for the delivery of 132 GWh of renewable energy per annum for seven critical infrastructure assets across New South Wales and Victoria, including Melbourne Airport, NSW
Ports, Southern Cross Station and Ausgrid, which are assets in our portfolio.
Other critical Australian assets joining the program as part of Stages 2 and 3 are expected to be announced in coming months. And we plan to develop a similar program for assets in our Global Infrastructure portfolio, several of which have already
developed renewable energy strategies, with green energy PPAs in place.
Read more about our approach to managing climate risk in our infrastructure asset class in our 2022 Responsible Business Report.