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A social value approach key to Gippsland's transition to renewables

Vanessa Pilla 

A widespread transition to renewables is our best chance of ensuring a sustainable and liveable future on this planet. But we must also ensure that our communities stand to benefit more immediately from this transition, and that those benefits are ongoing.

22 October 2021 | 4 min read

Asia Pacific

Australia

Melbourne

ON THIS PAGE

The potential for a Renewable Energy Zone

Gippsland is a rural region in Victoria, known historically as coal country. For decades the area’s economy has been driven by fossil fuels, with the Gippsland Basin containing the largest deposits of brown coal in the country.

However, Gippsland’s coal stations are either closing or being earmarked for closure, and the area has been designated as having the potential for a Renewable Energy Zone due to its existing workforce and grid capacity.

The potential for Gippsland to serve as a shining example of ‘what could be’ to other governments at local and state levels is massive, but the integration and provision of social value is key to the success of this initiative.

Social value is not just the environmental benefits provided by renewable energy projects, but the ability for communities to sustain themselves and grow, both economically and socially as renewables become the norm.

With the scale of investment, Gippsland is well positioned to leverage the investments, such as renewable energy projects like Star of the South and the Marinus Link, and the Gippsland Renewable Energy Park to ensure wider benefits are realised throughout the project lifecycle and across the region, from design, to delivery, and into operation.

The social benefits provided by renewables must extend beyond the project

Across Australia, one of the issues we face is that existing policies regarding ‘social value’ at the council, state, and federal level are inconsistent, and relatively narrow in scope. They don’t consider social value as something that can extend across and beyond the lifecycle of a project.

Victoria is leading the way, with both a Victorian Social Procurement Framework (2018), a whole of government approach to ensure procurement decisions incorporate social value and ‘Community Engagement and Benefit Sharing Guidelines’ recently published by Victoria’s Department of Environment, Land, Water and Planning (DELWP) and supported by Australia’s Clean Energy Council (CEC), targeted at developers and investors.

The latter defines community benefit sharing as “sharing the rewards of renewable energy development with local communities. It aims to integrate a development in the local community by contributing to the future vitality and success of the region. It is based on a desire to establish and maintain positive long-term connections to the area and to be a good neighbour”.

These benefits can include new jobs and business opportunities that can be achieved through social procurement, capacity building and community empowerment, reduced energy, and innovative ways to raise capital for the investment including co-investment and co-ownership models in the community.

Social value can be created at all stages of a project. But those opportunities must be identified and embedded in a project plan as early as possible to ensure maximum value is delivered to communities once the construction dust has settled.

Regional leadership and collaboration is crucial

The policy position and scale of investment in Gippsland provides the region with a unique opportunity to leverage regional economic development opportunities to ensure the benefits are equally distributed, and sustainable. Renewable energy projects are an opportunity to generate careers rather than just jobs, providing opportunities for Gippsland’s coal workers to transition and reskill.

To achieve this, regional collaboration is key to unlocking long-term social value. Key principles include, understanding the local context and taking a strategic and integrated approach to how those benefits are going to be realised. Regional leadership can build the partnerships needed between infrastructure developers, councils and projects so that the broader region can respond to the needs of the local community and ensure everyone benefits from the investments being made. 

This could include developing a shared value framework with goals and outcomes that the region is trying to achieve, baselining the current community, sharing data and collaborating on initiatives and programs so they can be delivered at scale.

Gippsland can be a case study for how social value can be created as we transition to renewables. But to make this a reality, we need to invest in benefits that go beyond the primary purpose of creating sustainable energy. We need to make renewables a source of energy and prosperity for people, communities and local economies too.