The Environmental Upgrade Agreements amendment was announced last week and creates an expectation the agreements will be rolled out across the state after running within the City of Melbourne for some time. 

Under the agreements, lenders would provide finance to a building owner for environmental upgrades with the local council then collecting the repayments through its rates system and forwarding them on to the lender. 

A local leading climate action and sustainability group has already come out in the support of the new legislation. 

Ballarat Renewable Energy and Zero Emissions chair Ian Rossiter  said with business margins already quite tight, a loan scheme was a good option. 

“It will be because one of the biggest issues in business is actually finding the upfront capital and looking at the repay period and how they can actually afford that with other costs such as labour and everything else,” he said. 

“At a time when they are finding the margins difficult I think this is actually quite a good initiative.”

The City of Ballarat does not currently have an environmental loan system in place, and while the legislation does not force a council to take up the move, many in the industry believe it to be a good idea and will be supported. 

The EUA loan is prioritised over other debts attached to the land if there is a loan default.

This means lenders have more security and are more likely to offer long-term loans at a low interest.  

Mr Rossiter said a number of other initiatives had been introduced over the past few years to encourage businesses to become more energy efficient. 

“There have been a number of initiatives from local and state government in previous years, not just around solar power energy efficiency, but also building management systems and looking at re-configuring lights in a building,” Mr Rossiter said. 

“We have seen a lot of funded programs where advice is given to business owners where they can give them (businesses) energy audits.”