Clean Technology Investment Program (CTIP): more grant winners announced

21 Nov 2012Archived News Climate Change Matters

Last Wednesday, 14 November, the Minister for Climate Change and Energy Efficiency, Greg Combet MP announced the latest round of CTIP grant recipients.  89 grants were issued to manufacturers valued at $30million.  Since the program was launched in February, we’ve seen 51 grants (over $20M) under the general CTIP funding program and a further 64 grants (over $32M) issued under the Clean Technology Food and Foundries Investment Program (CTIFFP).

The CTIP is a highly competitive process and AusIndustry is assessing a large number of applications.  Manufacturing businesses should investigate suitable projects and apply for funding now.  And the business case is compelling: energy savings and carbon emissions reduction projects can be 1/3 to 1/2 funded by a CTIP grant, made all the more attractive with complementary incentives from state programs, and top-up financing from Low Carbon Australia (at least until 30 June 2013 when the fund is due to close for new investments).

Other factors to consider:

  • Manufacturing sites which carry a direct carbon liability (emitting 25 000 tonnes CO2-e but less than 100 000 tonnes in covered emissions, which are a subset of direct scope 1 emissions), are able to apply for government funding on a 1:1 basis.  This was announced at the end of July.  Where applications are made for this increased level of support, you must ensure that the project under consideration is limited to the site defined as a facility within NGER’s reporting for that business.

  • Solar PV prices have plummeted and can be cost effective with CTIP funding (particularly if 1:1).  On-site wind can also be very attractive in the right location.  Some small scale wind applications were awarded in the last round (2 x 20kW wind turbines at Geelong Galvanising Co). These renewables and biogas attract CTIP funding as well as energy efficiency projects. 

  • Some industries may be concerned that their business does not strictly fall within the definition of manufacturing as determined under ANZSIC codes.  Such confusion may exist for a business deemed agricultural but which has an on-site manufacturing unit.  Energetics can provide advice in such circumstances.   

  • AusIndustry is focussed on funding projects that directly lead to energy savings and reductions in carbon emissions.  They will reject efforts to seek funding for large CAPEX projects that cannot demonstrate such outcomes.  Energetics is also aware of a number of features that must be highlighted or thoroughly developed for the application to pass and can ensure that these are addressed up front for a streamlined application passage.

  • Prospects of funding are substantially improved with a sound and independently verified Measurement and Verification (M&V) plan in place, particularly for grants > $1.5 Mil AusIndustry is looking for independent M&V in line with the IPMVP protocol. 

Program trends

There are some interesting features of the CTIP program looking across the grants awarded to date, and comparing the general CTIP program with the Clean Technology Food and Foundries Investment Program (CTFFIP): 

 

General CTIP

CTFFIP

Number of awards

51

64

$ of grants

$20,343,383

$32,596,933

Average size of grants

$406,868

$509,327

Average $/T CO2

52 - 150

 
 

The $/tonne vary for different industry sectors and regions. Ultimately AusIndustry will assess all grant applications relative to the benchmark rate of $23/t which is the current price on carbon. Initially higher values have successfully received grant funding but we expect that the competitive nature of this program will drive the threshold down towards this aspiration level.

The two charts below show that there is a strong leaning in both programs towards the more conventional energy efficiency measures. 

 

Recent winning applications

In the recent round of grant announcements there were three supported by Energetics with quite different features.  We have profiled these winning applications below:

General (CTIP):

Monroe Australia Pty. Limited, $120,527, Clovelly Park, SA
Monroe Australia will upgrade the current stainless steel muffle of the sintering furnace to a more reliable and energy efficient ceramic muffle design. This upgrade will enable more efficient operation of the furnace. The project is expected to reduce Monroe Australia’s carbon emissions intensity of the muffle by 16% and will result in savings of $61,000 in energy costs per year.  Energetics reviewed and checked the energy and savings calculations before preparing all the necessary calculators and merit sections of the application for submission

Food and Foundries (CTFFIP):

Diageo Australia Limited, $871,847, Huntingwood, NSW
Diageo Australia will install a 725 kW cogeneration system with reciprocating engine and implement a lighting system upgrade with energy efficient fittings, occupancy sensors and dimming controls at its bottling and packaging facility at Huntingwood. The project is expected to reduce the carbon emissions intensity of Diageo Australia’s Huntingwood facility by 41% and will result in savings of $252,000 in energy costs per year.  Energetics assisted with thorough analysis and feasibility reviews which supported both the business case and the application’s development.

Alba Edible Oils Pty Ltd, $499,143, Hamilton Hill, WA
Through this project, Alba Edible Oils will modify the plant’s refinery to automate the existing product changeover process and improve energy efficiency. Project activities include lagging of exposed pipe work and the optimisation or replacement of selected pumps, motors, boilers and a chiller. The project is expected to reduce Alba Edible Oils’ site-wide carbon emissions intensity of its Hamilton Hill facility by 53% and will result in savings of $190,000 in energy costs per year.  As with Diageo, Energetics assisted with thorough analysis and feasibility reviews which supported both the business case and the application’s development.

Creating a compelling application

In each of the successful applications listed above, a sound and well documented business case was developed which addressed all application requirements and eligibility issues.  It is critical too that the application shows that the project’s primary objective is to reduce energy usage and carbon emissions.  

Finally, as mentioned earlier in this article, Monitoring and Verification (M&V) is a very important part of the CTIP program.  A sound M&V plan needs to be included with the application and when executing the project. The M&V Plan needs to be completed to demonstrate the energy and carbon savings delivered by the project.  AusIndustry has indicated that they will withhold the final 20% of grant payments until the M&V stage is completed. 

Energetics has six IPMVP qualified practitioners, the highest of any energy management consultancy and can provide independent M&V assessment and advice for your project.

Don’t let the opportunity to obtain a CTIP grant pass you by.  You can be sure your competitors won’t!

 

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Andrew Lister

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