Valdora solar deal will be worth it: Mayor

MAYOR Mark Jamieson has broken the council’s silence over its $30 million solar farm proposal but failed to address key questions about the project.

MAYOR Mark Jamieson has broken the council's silence over its $30 million solar farm proposal but failed to address key questions about the project.

Figures provided by Cr Jamieson yesterday relating to the council's purchase of a 49ha flood-prone block of cane land at Valdora were also at odds with documents it filed with the Planning and Environment Court.

The council put its total purchase costs at $4.1 million for the block of land, which had changed hands for only $770,000 18 months ago.

Cr Jamieson said $2.3 million of the amount was for "the substantial cost to develop the project plan as well as the intellectual property", with another $300,000 being the option to purchase the site and $1.5m for the actual land. How those "project plan costs" were valued was not explained.

But Mr Jamieson insisted that the council had been thorough.

"Despite having a comprehensive report and business case, and the option on one of the few suitable blocks in the region, the council took additional measures to ensure it was making the right decision," he said.

"The council engaged two firms to undertake an independent assessment of the business case.

"Armed with these two reports, a study undertaken by Energex, and taking into consideration potential future legislative changes - the business case was substantially amended - it differs greatly from the original which has been (criticised). The amended business case delivers a much better result..."

The court documents provided a different explanation for the payments to Gruenenergy.

READ THE FULL 65-PAGE COURT DOCUMENT 

SOLAR LAND PURCHASE AND TRUST DEED

SOLAR LEASE DOCUMENT

AMENDED SOLAR LEASE DOCUMENT

SOLAR TRANSFER TO COUNCIL

They showed council paid $4.33m for the property, made up of $1.65m (including GST) which was paid to Akerman Enterprises Pty Ltd, a $300,000 option fee plus two payments of $1.19m each to Gruenergy for the option it held to buy the land and $10,000 for documents developed by former council planner and former Gruenenergy director Jason Hague.

Another $56,000 was paid to Akerman in rent for the period the council held the option before final purchase.

Council now also faces a potentially expensive legal challenge to its right to build the solar farm on that site.

An application to convert the cane land to a solar farm was made to the council in February, 2011, by a company called Energy Parks Australia headed by Mr Hague. Approval was granted that year.

Cr Jamieson said following that approval the council was approached to become a customer of the proposed solar farm, but that the cost of the power it generated was too high.

"But the council liked the idea of 'green power' and further analysis showed if it owned the project the organisation could save millions of dollars on electricity," he said.

"The reason? The council could cut out the middle man and eliminate the biggest risk - the need for a customer. The council could be its own customer."

The Daily has repeatedly asked when council first began to discuss taking over the project.

The question is critical.

In August, 2012, Gruenenergy signed a 30-year lease with Akerman Enterprises. The initial rent was $95,000, to increase 3% a year.

The lease included an option for Gruenenergy to purchase the land for $1.5 million or market value, whichever was greater. The next month Gruenenergy paid Lyn and the late Col Turner $770,000 for the land, immediately on-selling it to Akerman for $1.1 million.

If the council was in discussion to take over the project before any of these events, it allowed architecture to be put in place that inflated the price to the benefit of a few at a significantly increased cost to ratepayers.

According to the council's own documents, it paid $2.68 million in total to Gruenenergy to remove its control of the land.

Cr Jamieson now says those payments were for the project development costs incurred by Gruenenergy despite the original development approval being granted to Energy Parks Australia.

Following that decision in 2011 the next mention of the solar farm in council records was at the December, 2012, general council meeting when Cr Stephen Rob

inson, seconded by Cr Tim Dwyer, put what appeared to be an insignificant motion asking the CEO about the project.

By the end of January the council had committed to pursue the project in its own right.

The mayor said the latest business case, which the council would not release publicly, would save more than $9m over 30 years.

The mayor released information to media on Thursday because The Daily would not agree to run his version unedited and unquestioned. 

YOU CAN HEAR THE MAYOR'S ABC INTERVIEW HERE

PART of the interview between the ABC's Emma Cillekens and Sunshine Coast mayor Mark Jamieson yesterday.

Cillekens: Have you gone in and talked to the people of the area and consulted them about the plan?

Mayor: No.

Cillekens: Why not?

Mayor: Because Valdora is a significant area, many, many hundreds of acres of land. We have chosen a particular place to put a solar farm … there are no properties nearby other than farms.

The 400 homes that oversee that area currently look over a wide space. Does that give them the right to control that land into the future when we have a project here that is going to save all ratepayers money, going to provide new stimulus in our clean technology economy that we see as being very important on the Sunshine Coast?