Enova Energy has become Australia’s first community-owned energy retailer to gain a licence to sell electricity to consumers in what could become the first step to a complete re-design of the energy market.
The Australian Energy Regulator approved the application for a retail licence subject to completion of Enova’s current capital raising by late November.
Chair of the retailer’s board, Alison Crook, described the event as “historic”, adding she expects more organisations to follow Enova’s lead.
The model could be used in towns and communities keen to establish renewable-based micro-grids as a cheaper and more sustainable alternative to the system of centralised fossil fuel generation.
Enova will be based in the northern rivers region of New South Wales, but will sell electricity to consumers as far south as Coffs Harbour and Glenn Innes.
Enova chief executive officer Steve Harris said shareholders will reap the benefits from high feed-in tariffs, low supply charges and shareholder dividends.
The retail licence enables Enova to enter into financial arrangements with all parties in the energy sector. In particular it will enable Enova to purchase energy from local renewable energy generators such as that being proposed by Community-Owned Renewable Energy Mullumbimby – a not-for-profit action group – and the Lismore community solar initiative.
It also allows Enova to enter into arrangements with Essential Energy, the local grid operator, to transport that energy through the grid to customers who wish to purchase it and, in addition install, their own electricity meters.
Enova’s structure is expected to prevent as much as $80 million from leaving the local economy.