Strategic Bulk-Buying Strategy to Reduce Energy Costs

People under pressure to save on energy have been promised a radical plan by one city’s leader, who says it will slash power bills.

Melbourne Lord Mayor Nick Reece has pledged to establish Australia’s largest community-led bulk purchasing program for renewable energy across Melbourne, if he is re-elected.

“Australians are desperate for power savings at the moment,” he said on Aug. 18.

“People want relief from the pressure they’re under.

“I would expect that hundreds of thousands of people and businesses would be signing on to this scheme.”

Under the M-Power initiative, the City of Melbourne would harness the collective buying power of households and small businesses to secure the lowest possible rates for renewable electricity, in what Reece says could save Melburnians hundreds of dollars each year.

Jackie Middleton, who owns six businesses across the City of Melbourne, has thrown her support behind the policy.

“Since COVID, we’re looking at between 60 percent and 80 percent increased business (energy) cost,” she told journalists.

The plan would include her businesses in significant savings, she said, and an opportunity to capitalize on access to renewables.

The initiative would not just benefit residents of the Victorian capital, but other inner-city councils Darebin, Hobsons Bay, Maribyrnong, Merri-bek, Moonee Valley, Port Phillip, Stonnington, and Yarra.

Reece said the plan had potential for local governments across the nation and there was no reason why other councils couldn’t join once the project was underway in Melbourne.

“I do hope this is something that other cities around Australia will look at,” he said.

The scheme is expected to cost the City of Melbourne up to $2 million (US$1.3 million) in addition to staffing costs, with the funding to be reallocated from within its existing budget.

If Reece is re-elected, consultations and negotiations for M-Power will begin in 2025, with the first contracts expected to be available in 2026.

It’s not the first time a local council has taken up the fight against rising energy bills.

In 2023, the Northern Beaches Council in New South Wales (NSW) started an initiative granting small and medium-sized businesses access to exclusive energy deals that are typically out of reach for smaller players.

South Australia’s City of Mitcham introduced a community program in 2021 by bulk-buying solar panels and batteries for residents, businesses, sporting clubs, and associations to accelerate their uptake.

The City of Sydney signed an agreement in 2020 for renewable energy to be supplied across the city including libraries, parks, and community halls.

Reece said he had spoken with local governments across Australia and internationally before announcing his bulk purchasing scheme.