As the entire globe is pushing towards decarbonisation, businesses in Australia are under pressure to adopt greener and more sustainable energy practices. A study conducted by the Clean Energy Regulator suggests that 39% of Australia’s electricity came from renewable sources in 2023. Driven by the country’s commitment towards the net-zero policy, it is anticipated that around 50% of the electricity in Australia will come from renewable sources by 2030.

Curiosity among businesses regarding the green energy contracts is at an all-time high. These contracts not only help reduce carbon emissions but also aid businesses with cost-effectiveness through grants, incentives, etc. While the large-scale enterprises and multi-national companies have adopted the green movement with much enthusiasm, small and medium companies in Australia often find themselves in contractual complexity and cost comparison hassles.

About Green Energy Contracts

Green energy contracts refer to the electricity agreements that commit to providing clean energy, which is either partially or completely sourced from renewable resources. The GreenPower-accredited contract, one of the most reputable green energy contracts for businesses in Australia, ensures that your provider purchases the electricity from the accredited renewable resources.

Such contracts encourage businesses to participate in the green movement and reduce carbon emissions. By staying aligned with the corporate sustainability goals, businesses can enjoy seamless compliance and receive grants offered by the state. Typically, green energy can be purchased through the following methods:

• GreenPower add-ons
• Direct PPAs (Power Purchase Agreements)
• Carbon-neutral tariffs from the retailers

Reasons Why Businesses Switch to Green Energy

Australia has committed to achieving zero carbon emissions by 2050 under the Paris Agreement. Businesses have a major role to play in fulfilling this commitment. However, supporting the green movement is not the only driving force here. Adopting renewable energy can bring cost-effectiveness and energy sustainability for businesses. Here, in the following section, find a guide to the reasons why businesses should switch to green energy.

• Regulatory Pressure: Switching to green energy is no longer a choice, but a compulsion for businesses. Australia’s commitment to achieving zero carbon emissions by 2050 has resulted in several regulatory changes for businesses. Therefore, organisations have started looking for green energy plans to stay compliant with the regulations.
• Brand Reputation: According to a Nielsen survey, around 46% of consumers want their favourite brands to lead on sustainability. The customers are ready to pay more for products and services from the businesses that embrace sustainability. Therefore, switching to a green energy contract may increase your brand reputation and loyalty among buyers.
• Access to the Incentives: Businesses that invest in green energy plans could find themselves eligible for various grants and incentives. The rebates and tax offsets often prove cost-effective for businesses since they reduce expenses. Investing in renewables can fetch multiple rebates and incentives for businesses operating in Australia.

Benefits of Green Energy Contracts

Switching to green energy contracts can be beneficial for many reasons. In the following section, find the benefits that a business can harness by embracing green energy contracts.

1. Stable and Predictable Energy Cost

Green energy contracts help businesses remain on a stable and predictable energy cost for a long time. Businesses can get into long-term Power Purchase Agreements (PPAs) for price stability for the next 5-10 years.

The energy market is volatile, and prices for various business energy plans often fluctuate depending on the market conditions. In such a volatile market scenario, the PPA will keep your energy bills predictable. Therefore, businesses will not face a financial crunch due to high bill amounts.

2. Increased Business Brand Value

Investing in sustainable products can increase the brand value of your business significantly. Consumers want to spend more on products or services from businesses that are open to embracing sustainable measures to run their operations. Businesses also gain quick recognition and reputation by choosing green energy contracts.

3. Better Risk Management

Managing risks is another key area where businesses need to put effort. Green contracts help businesses mitigate the energy-related risks discussed below.

• Operational Risks: Energy sourced from renewable resources does not face interruptions due to inadequate raw material supply.
• Regulatory Risks: Businesses that do not adapt to energy sourced from renewable resources face regulatory risks.
• Reputational Risks: Businesses that do not embrace green energy for a sustainable future may suffer reputational risks. Avoid such risks with green energy contracts.

4. Access to Incentives

Adopting green energy makes businesses eligible for various grants, rebates, and incentives. Harnessing these benefits can further reduce energy expenses for businesses. In Australia, different states have grants and rebates for businesses that adopt renewable energy. You can consult an expert who can help you understand the incentives that your business is qualified to leverage.

5. Clean Energy for Appliances

Renewable energy sources produce cleaner energy, which is suitable for all types of machines and appliances. Clean energy reduces the wear and tear of the motors. Therefore, businesses need to allocate a smaller budget for equipment maintenance. On the other hand, businesses experience rare downtime due to maintenance or failure of the appliances.

Conclusion

Green energy contracts have become a buzzword among businesses in Australia for the reasons discussed in this article. Using the energy produced by renewable resources is good for the environment since it reduces the carbon footprint and protects non-renewable natural resources. On the other hand, businesses can enjoy cost-effectiveness through rebates, long-term fixed tariff agreements, and more.

Looking for the best green energy contracts for your business? Connect Business Energy can be your place to find the best green energy contracts from reputable energy providers in Australia. We offer quality consultation to businesses that want to adapt to a sustainable future by investing in green energy.