Sustainable Finance Mechanism – Repayable Grants

Last updated: 2 December 2021
Status: Applications open
Closing date: When funds are exhausted
Total funding available: At least $50,000 per community group to help secure third-party financing
Co-contribution:

$5:$1 (SV:Applicant) Co-contributions can be either financial (cash) or In-kind. Up to 100% of the contribution can be In-kind.

Available to: Community groups

Sustainability Victoria is supporting community groups through the Sustainable Finance Mechanism – Repayable Grants, established under the Social Impact Investment for Sustainability Fund. The fund aims to enable applicants to secure a low-interest rate loan from a financier for implementation-ready, community renewable energy projects. The grants work as a cash security against loans to be repaid within a 5-year period.

Applications can be submitted from 3 November 2021 until funds have been exhausted. The $1 million has been allocated for these grants as part of the $5.93 million Community Power Hubs Program, which is within the Victorian Government’s $1.6 billion renewable energy package in the 2020-2021 Budget.

The following are the guidelines for applying for this fund.

1. Fund overview

1.1 Fund outcomes

The fund aims to achieve the following outcomes:

  • Support community groups seeking third-party financing for the delivery of community energy projects.
  • Address barriers to accessing low-interest finance for community energy projects.
  • Provide a sustainable financing mechanism in which grants will be returned over time and can be recommitted to other community projects.
  • Build greater understanding, participation and partnerships with third-party private finance providers on community energy projects.

1.2 Funding available

Grants of at least $50,000 are available for community groups to help secure a loan of the same value from a financier of choice. The grant will work as a cash security against the loan. The grant is to be repaid to Sustainability Victoria at the same time the loan is repaid to the financier, within 5 years.

1.3 Co-contribution

Co-contribution from the Applicant is required. A minimum of $1 must be provided by the applicant for every $5 in grant funding. This co-contribution can be either financial (cash) or in-kind. Up to 100% of the contribution can be in-kind and funding from other grant programs can be included towards the contribution.

2. Eligibility

2.1 Who can apply

Applicants must:

To be eligible to receive funding, grant applicants need to:

  • be a community entity or group developing a Community Energy Project from which the community will benefit
  • have a fully scoped renewable energy, energy efficiency or energy storage project proposal with all due-diligence, grid connection pre-approvals and financial modelling completed
  • have project support from one of seven Community Power Hubs listed below:
    • Barwon South West
    • Gippsland
    • Grampians
    • Yarra Valley and Ranges
    • Hume
    • Loddon Mallee
    • Metropolitan Melbourne
  • demonstrate that they have the capacity to successfully implement the proposed project in their region within an agreed timeframe.

We encourage applications from Aboriginal and Torres Strait Islander organisations and also co-operatives registered in Victoria.

Sustainability Victoria manages several grants. Although you can apply for more than one grant for a project, you will only be eligible to receive one grant. If you’ve already applied for a Sustainability Victoria grant and now find this grant to be more relevant or suitable, you can withdraw your application by emailing us.

2.2 Who cannot apply

  • Individuals
  • Local government authorities
  • State government agencies
  • Research institutes
  • Peak bodies
  • Waste and Resource Recovery Groups.

2.3 What will be funded

The repayable grant will act as a cash security against a loan to support community energy projects that:

  • have in-principle support for a loan from a financier
  • install clean energy technologies
  • have received funding or support for the same activities from other sources.

Project activities and costs the loan may fund include:

  • pre-construction (site preparation) for project implementation, such as site clearing earthworks or site accessibility works
  • capital purchases (e.g. infrastructure or equipment)
  • planning and building permits
  • consultancy costs/project management costs.

Projects must:

  • be Community Energy Project supported by the regional Community Power Hub
  • be located in and service Victoria
  • meet regulatory or planning requirements
  • be complete by 12 months after the funding agreement is executed.

You can submit multiple applications. Each application must be for a different project. A project can have multiple buildings/sites.

2.4 What will not be funded

The following projects are ineligible:

  • Initiatives that involve unproven or emerging technologies.
  • Projects that are being undertaken to comply with regulation or a regulatory notice or order.
  • Projects that don’t meet regulatory or planning requirements.
  • Requests for retrospective funding, where projects are completed or have commenced prior to signing a funding agreement with Sustainability Victoria.
  • Projects that have commenced construction of infrastructure before signing a funding agreement with Sustainability Victoria.

The following project costs are ineligible:

  • Salary and administration costs
  • Lease or purchase of land
  • Planning, communication, and community engagement functions
  • Community energy project planning and oversight
  • Capital raising activities
  • Marketing, advertising, promotional costs
  • Contingency costs
  • Business case development and feasibility studies
  • Procurement for specific Community energy project feasibility services
  • Routine or cyclical maintenance works of existing and proposed projects
  • Repair of facilities damaged by vandalism, fire or other natural disasters where damage should be covered by insurance
  • Purchase or lease of vehicles
  • Research, development and demonstration
  • Travel, conferences and other educational activities.

3. Assessment process

3.1 Assessment criteria

The assessment panel will assess the application based on merit according to the criteria below.

What

Weighting: 40%

Describe what you are going to do and how the project meets Sustainability Victoria’s project/business plan objectives including demonstrating what you expect the project to achieve in terms of:

  • installing clean energy technologies
  • its impact on reducing greenhouse gas emissions, energy costs, increased energy self-reliance, income generation and/or increased knowledge and awareness of renewable energy.

Who

Weighting: 20%

Demonstrate how the Lead Applicant and project partners have the ability to deliver the project, including capability (skills) and capacity (resources).

Why

Weighting: 20%

Describe how the project meets the need or problem.

How does the project align with and deliver economic, environmental and social objectives in your community?

Why do you need the Community Power Hub and government assistance for the project to be delivered?

How

Weighting: 20%

Describe how the project will be delivered.

Describe how the project is commercial, feasible and capable of being delivered, including:

  • financial projections regarding return on investment
  • land owner and site manager approval for the project
  • electricity distributor approvals
  • in principle agreement from a willing financier.

3.2 Diversity consideration

Sustainability Victoria may overlay rankings to achieve an overall mix of projects that represent a geographical spread across Victorian regions.

3.3 Due diligence checks

A risk-based approach will be used to assess the Applicant’s social, economic and environmental risks in relation to the project. This assessment will include the Applicant’s related entities and may include Project Partners and/or Project Participants (see Section 9: Program definitions).

Applicants (and their Related Entities and, if applicable, their Project Partners and/or Project Participants) must:

  • have had no environmental, safety or workplace breaches in the last five years or, if there was a breach, Sustainability Victoria may assess that the Applicant’s breach poses a satisfactory level of risk
  • have not been the subject of an enforceable undertaking or successful litigation by the Fair Work Ombudsman for a breach of the Fair Work Act 2009 or a fair work instrument within the last five years
  • demonstrate financial capability to undertake the project
  • have adequate insurance as outlined in the funding agreement and including:
    • Public liability $10 million minimum
    • Professional indemnity $5 million minimum
    • WorkCover
  • have not failed to satisfactorily progress or complete previous projects funded by Sustainability Victoria within funding program timelines and without sufficient reason
  • manage any conflicts of interest adequately.

Assessment of satisfactory level of risk will include but not be limited to Sustainability Victoria’s consideration of:

  • the seriousness of any finding/s
  • whether the finding/s has been resolved to the satisfaction of the relevant enforcement agency, or the applicant can demonstrate it is working effectively to resolve the finding/s
  • the efforts made by the applicant including implementation of management systems, to ensure no further finding/s occur
  • whether, since the finding, the Applicant has had a satisfactory level of compliance with relevant environmental and safety laws and workplace laws.

Sustainability Victoria may conduct due diligence checks on the Project Partners and/or Project Participants involved in the delivery of the project. The Applicant must ensure that any Project Partners and/or Project Participants agree to cooperate with this requirement and will provide information at Sustainability Victoria’s request.

Sustainability Victoria reserves the right not to award funding to Applicants where the due diligence risk (including that of Project Partners and Projects Participants) is unsatisfactory or not able to be managed.

4. Funding conditions

Successful applicants approved for funding must do the following.

4.1 Before starting the project

  • Participate in an inception meeting to discuss project and funding agreement.
  • Agree to 100%, upfront milestone payment with project delivery reporting.
  • Provide Sustainability Victoria with insurance certificates of currency.
  • Sign Sustainability Victoria’s funding agreement within 30 days of approval.
  • Provide a project plan.
  • If you receive funding of more than $250,000, plan for capital works signage.
  • If your project is in regional Victoria and is given funding of at least $1 million, you need to meet Local Jobs First requirements.

4.2 During and after the project

  • Deliver the project as outlined in the application and comply with the funding agreement.
  • Contribute to regular project progress updates or meetings.
  • Notify Sustainability Victoria immediately about any delay or change to the project.
  • Provide update reports to Sustainability Victoria at agreed milestones with evidence of expenditure, progress and performance
  • Provide adequate monitoring and evaluation of the project according to the funding agreement.
  • Collect and release data to Sustainability Victoria. Sustainability Victoria may share or report on the data.
  • Contribute to the project’s promotional activities (for example, provide Sustainability Victoria with support by reviewing and approving written stories or videos).
  • Participate in and contribute to Sustainability Victoria activities to distribute the findings to broader stakeholders (for example, government and industry).
  • Acknowledge that Sustainability Victoria has contributed funding in all communications related to the project.

5. Timeline

Dates may change.

There is no date for the announcement of application outcomes. We will provide applicants with updates as often as possible and when necessary.

Applications open: Wednesday 3 November 2021

Applications close: When funds are exhausted

Notification of outcome: On-going

Funding agreements established: On-going

Projects commenced by: After execution of funding agreement

Project completed by: 12 months after execution of funding agreement

The Sustainable Finance Mechanism (repayable grant) is to be repaid to your financier (and Sustainability Victoria) within 5 years.

6. How to apply

Before applying, consult with the Community Power Hub in your region and receive their support and endorsement of your proposed project.

  1. Ensure that your organisation can apply.
  2. Ensure that your project is qualified.
  3. Read Sustainability Victoria’s funding agreement. You must meet the terms and conditions to ensure funding.
    1. For grants more than $50,000 read the General Funding Agreement Conditional Grant (pdf, 492kB).
  4. Read Sustainability Victoria’s Terms of participation in grant programs.
  5. Create an account on the SmartyGrants website.
  6. Submit your application on or after 3 November 2021. Applications will only be accepted after receiving support and endorsement from your regional Community Power Hub.

Your application

  • Allow adequate time to plan, research, gather supporting documentation and draft your application.
  • Before beginning your application, seek support of your application from your regional Community Power Hub.
  • You must use SmartyGrants, unless you have written permission from Sustainability Victoria.

7. Assistance available

7.1 Contact us

We cannot review or provide feedback on draft proposals.

Phone: +61 3 8656 6757 Monday to Friday, 10:00 am to 4:00 pm.

Email: grants.enquiries@sustainability.vic.gov.au

In the subject line, use the grant name Community Power Hub: Sustainable Finance Mechanism Repayable Grants

8. Why the Victorian Government is providing this funding

This funding is released as part of the Victorian Government’s $1.6 billion renewable energy package, including $5.93 million allocated for the establishment and coordination of the Community Power Hubs program.

Recommendation 4 of the Victorian Parliamentary Inquiry into community energy projects (2017) proposed introducing a loan to support the delivery of implementation-ready projects, enabling applicants of community projects to secure a low-interest rate loan from a financier. Through these repayable grants, Sustainability Victoria will support community groups seeking third-party financing for the delivery of community energy projects.

This funding will target projects that come out of the planning and development activities from the 7 Community Power Hubs. The grants will address barriers to accessing low-interest financing faced by community groups who would otherwise not be able to secure a project loan at a low-cost to make their project viable.

As the grants will be returned over time, the funds can be recommitted to extend the benefit of public funds and further leverage private finance for community-based net zero carbon investments.

9. Definitions

Applicant

The applicant who applies for the funding and is responsible for all details in the submission of an application and the contractual obligations under the funding agreement with Sustainability Victoria if successful for grant funding.

Clean energy

Technology related to renewable energy, energy efficiency or storage of renewable energy.

Co-contribution

The Applicant’s required cash or in-kind contribution to the total project income.

Community Energy Project

A project in which a community (of geography and/or of interest) is involved in initiating, developing, owning, operating and/or benefiting from renewable energy and energy efficiency development. Crucially, a community is involved in both the process of establishing the project, as well as benefiting from its outcomes. Common benefits from community energy projects include reduced electricity costs, increased energy self-reliance, income generation and increased knowledge and awareness of renewable energy.

Direct Jobs

Actual new full-time positions created by your business. This can include training or upskilling of employees who would otherwise be made redundant through the implementation of your project.

Environmental, Safety or Workplace Breach

An environmental or safety breach is any past or current prosecution, reportable incident, investigation, notice, penalty, warning, regulatory intervention or enforcement action from the Environment Protection Authority (EPA), Victorian WorkCover Authority (WorkSafe) or Fair Work or failure to comply with any environmental, safety and workplace laws.

Environmental and Safety Laws

Environmental and safety laws are the Occupational Health and Safety Act 2004, Environment Protection Act 2017 or any other legislation, regulation, order, statute, by-law, ordinance or any other legislative or regulatory measure, code, standard or requirement relating to the protection and safety of persons or property or which regulate the environment including laws relating to land use planning, pollution of air or water, soil or groundwater contamination, chemicals, waste, the use, handling, storage or transport of dangerous goods or substances, greenhouse gas emissions, carbon trading, or any other aspect of protection of the environment.

Full-Time Equivalent Employees (FTE)

The hours worked by one employee on a full-time basis.

Calculating FTE

The calculation is used to convert the hours worked by several part-time employees into the hours worked by full-time employees. For example, you have three employees working the following - 40, 40 and 20 hours per week, giving you 100 hours per week in total.

Assuming full-time hours are 40 hours per week, your full-time equivalent calculation is 100 hours divided by 40 hours which equals 2.5 FTE.

Implementation Ready Project

A community renewable energy project that has completed all necessary feasibility and/or business cases and has obtained all the necessary approvals. Projects need to be commissioned and operational within 12 months of signing the funding agreement.

In-kind contribution

An in-kind contribution is a contribution of a good or a service other than cash.

In-kind contributions should include the cost for activities that are directly related to delivering your project. Examples include:

  • staff time to manage project implementation (project management and installation costs that utilise existing internal resources)
  • time spent on project activities by volunteers
  • donated goods or services related to the project.

The following activities cannot be considered as in-kind contributions:

  • operating expenses that are not directly associated with delivering the project
  • opportunity costs such as staff ‘downtime’ during the installation of equipment or implementation of activities.

Applicants must fairly justify how they determined the dollar value for in-kind contributions.

Lead Applicant

The lead applicant will be responsible for all details in the submission of an application and the contractual obligations under the funding agreement with Sustainability Victoria if successful for grant funding. The lead applicant is also responsible for managing the project outcomes and deliverables.

Not-for-Profit (NFP)

An organisation that provides services to the community and does not operate to make a profit for its members (or shareholders, if applicable).

Project Participant/s

An organisation engaged by the applicant to assist in the delivery of the applicant’s project, including but not limited to major subcontractors, contractors, product suppliers and consultants.

Project Partner/s

An organisation/s in a collaborative partnership with a lead applicant that have a critical role in the project and a formal commitment to delivering the support required to ensure the project’s success.

Related Entities

Entities which are related to the applicant, including:

  • holding companies of the Applicant
  • subsidiaries of the Applicant
  • subsidiaries of holding companies of the Applicant
  • companies with common directors or shareholders as the Applicant
  • companies that are a beneficiary under a trust of which the Applicant is a trustee
  • trustees of a trust under which the Applicant is a beneficiary
  • companies that conduct business at the same address as the Applicant, or the same address as the location of the activity for which the funding is sought

Related Person/s

Related person means a director, officer, employee, agent, board member or contractor of the applicant or a related entity.

Renewable energy

Energy that is produced using natural resources that are constantly replaced and never run out.

Unproven or emerging technologies

Technology that requires legislative changes or further research and development in order to be implemented.

Workplace Laws

Workplace laws are the Fair Work Act 2009, or any other legislation, regulation order, statute, by-law, ordinance or any other legislative or regulatory measure, code, standard or requirement relating to the provision of fair, relevant and enforceable minimum terms and conditions for all persons and to prevent discrimination against employees.

Contact us

We cannot review or provide feedback on draft proposals.

Phone 03 8656 6757 Monday to Friday from 10:00 am to 4:00 pm.

When emailing
In the subject line, use the grant name: Sustainable Finance Mechanism – Repayable Grants.