City of Newcastle will move to 100 per cent renewable energy in the new year after signing a 10-year power purchase agreement with energy retailer Flow Power.
The council estimated ratepayers would save around $1.8 million over the 10-year contract, which starts January 1, 2020.
The announcement on Tuesday followed the City of Sydney's announcement on Monday that it had signed agreements with Flow Power to source renewable energy for all of its properties from next July.
City of Newcastle said its deal would see it become the first council in NSW to move to 100 per cent renewables. The agreement follows the council's August resolution to make the switch to renewables when existing supply contracts expire.
The council is the latest in a growing list of large Hunter-based organisations, including the University of Newcastle and Waratah-based manufacturer Molycop, that have committed to use renewable energy in their operations.
City of Newcastle, along with other Hunter councils, has already made a significant investment in solar power in recent years.
It already draws half a megawatt of solar energy from the roofs of 10 of its facilities, including Newcastle Museum. An additional five megawatts will soon come online from the solar farm at the Summerhill Waste Management Centre.
Newcastle lord mayor Nuatali Nelmes said every piece of council infrastructure would be powered by renewable energy.
"Drawing all our energy needs from renewables is a significant achievement for the city and our mission to make our operations more sustainable and cost effective," she said.
Ms Nelmes said about 70 per cent of the respondents to a recent community survey ranked the switch to renewable energy as one of their highest priority measures to reduce the council's impact on the environment.
The Newcastle Herald reported on Monday that billions of dollars of Hunter-based renewable energy projects help drive the region's transition from coal to a low-carbon economy.
They include a 250 megawatt wind farm at Bowman's Creek, a 250 megawatt pumped hydro scheme at Bells Mountain, a 250 megawatt gas-fired power station at Tomago. It is also hoped the 113 megawatt Kyoto energy park near Scone will also be built.
Flow Power chief executive Matthew van der Linden said organisations like City of Newcastle were "leading the transition to a new energy future".
"We're thrilled to see the uptake of renewable deals like these grow in the Hunter Region, as proven by City of Newcastle and Molycop earlier this year," Mr van der Linden said. "We see this as a long-term partnership, which will not only support the City of Newcastle but also, have significant broader impacts for the local region."
City of Newcastle has purchased power that will be sourced from CWP Renewables' Sapphire Wind Farm near Glen Innes. The farm generates enough energy to power around 115,000 homes annually.
The facility is part of a 1,300-megawatt wind, solar and battery portfolio the Newcastle-based firm is building across Australia.
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