'Unaffordable' power drives Molycop, Coles to solar

Supermarket owner Coles and grinding materials supplier Molycop have inked separate long-term contracts to buy renewable energy driven by high electricity bills and commitments to shrink their environmental footprint.

The deals will support several new solar and wind farms in regional NSW and represent an acceleration of corporate power purchase agreements (PPAs) for clean energy after a lull earlier this year around the federal election.

The 10-year deal by Coles, the first to be signed by a major Australian retailer, will underpin the construction of three new solar farms near Wagga Wagga, Corowa and Junee and will provide the equivalent of 10 per cent of Coles' national electricity usage.

"We've seen significant increases in costs from an energy perspective," said Thinus Keeve, chief property and export officer at Coles. "This is a very good deal for us, it's a very good deal for the environment."

Molycop, which was unable to run its steelmaking plant last summer some days due to "unaffordable" power prices, said its contract will help it "to better manage the volatility of and contain the escalation in electricity prices it has experienced, particularly over the last four years".

Molycop's huge deal for 100,000 megawatt-hours a year of renewable energy will cover more than half its electricity consumption in NSW and make it one of the country's largest purchasers of renewable energy. Running until 2030, it is backed by offtake arrangements with Spark Infrastructure's Bomen solar farm under construction near Wagga Wagga and the operating Sapphire wind farm in New England owned by CWP Renewables and Partners Group.

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