Local Energy & Microgrids ConferenceApril 2016

Stockland ShellharbourSolar Power Station

Greg Johnson

National Sustainability

Manager,

Commercial Property

The Stockland Shellharbour Solar Power Station

Our first solar PV installations

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Stockland Green Hills, NSW - 67 kWInstalled September 2012Design annual output 100,500 kWhCost per kW after STC’s = $3,446

Stockland Jimboomba, QLD - 31 kWInstalled March 2013Design annual output 46,500 kWhCost per kW after STC’s = $2,303

Stockland Nowra, NSW - 50 kWInstalled July 2013Design annual output 75,000 kWhCost per kW after STC’s = $1,724

Pre Shellharbour installed capacity – 148kW

Solar power as a proportion of FY13 Retail grid energy use222,000 kWh / 63,500,000 kWh = 0.35%

Stockland FY17 renewable energy targetEquivalent of 3% of FY13 Retail energy use = 2,025,000kWhprovided through solar energy or 1.35MW installed capacity

System Facts

• Partnered with Todae Solar & Canadian Solar to supply, install, maintain and provide ongoing

performance guarantee.

• Largest rooftop solar PV system in Australia @ 1.22 MW at the time of commissioning.

• 7 systems comprising 3,991 Canadian Solar 305w Modules over approximately 7,650 m2 of roof area

• 43 SMA Sunny Tripower inverters and Cluster Controllers located in 7 inverter stations

• Sunlock commercial clamping roof brackets tilted at 15 degrees

• Installation time from site establishment and procurement to commissioning in May/June 2015 – 11

weeks

• Project cost $2.19 million excluding roof sheeting replacement works; Cost per kW $1,795 (no STC’s).

• Total annual output – 1,740,000 kWh; Annual carbon emissions reduction – 1,700 tonnes/CO2e

System Configuration

How does this project fulfil a need or desire?

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The project sought to address a number of challenges

• Identify new sources of income for the

business through non traditional channels.

• Diversify the energy mix in our Retail portfolio

through alternative and renewable energy.

• Reduce energy intensity of the Retail portfolio

by 10% by the end of FY17

• Achieve a target of 3% of Retail energy

consumption supplied by renewables by the

end of FY17.

• Utilise Australia’s first ‘Green Bond’ to finance

the project to deliver environmental benefits

to the community.

• The combination of revenue generating

infrastructure and technology allowed us to

achieve income, project financing and

environmental objectives concurrently.

How does this project provide value to the business?

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The project created a number of opportunities

• Performance Warranty guarantees output and income. The PW is 97.5% of the agreed output figure that the system must achieve or penalties may be applied.

• Improved intellectual property for Stockland and growing a team of trusted consultants and contractor partners for future solar projects.

• Contribution to local job creation with over 50 staff employed on the project with half from the Illawarra region.

• Highly visible renewable energy demonstration project in the Shellharbour community.

• Lessons learned from the project have helped identify opportunities for efficiencies, time and cost savings for future projects.

• Multiple regional television and newspaper media and national marketing opportunities to showcase the project in the Illawarra region and promoting Stockland’s commitment to sustainability.

How does this project deliver a commercial outcome?

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The project will deliver a solid commercial return

• Total capital budget = $2.5M

• Initial yield = 12.8% (Income = $280k; Savings =

$28k)

• 10 year IRR = 12.9%

• Valuation uplift = $2.4M

• Additional and diversified income stream from on

selling solar electricity to retailers outside of

traditional income streams.

• In addition the Large Scale Generation

Certificates (LGC) spot price has been trending

upwards since initial project feasibility (from $40 to

$79/MWh)

• This has netted an additional $39/MWh ($67.8K)

of income compared to the feasibility; nearly

double the forecast.

• Other reputational and non-financial intangible

benefits from the positive coverage this project

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Challenges and lessons learnedChallenges

• Scale and logistics of the site – knowns and unknowns, inverter

locations took time and cost to identify after construction

commenced; more time on this up front would have been

productive.

• Centre layout, varying roof heights and large roof area - different

access points made traversing the site difficult and time

consuming.

• Working with a ‘live’ shopping centre – drilling constraints, on site

storage, cranage, varying orientations, roof mounted plant and

equipment impediments. Managed well by Todae Solar 10/10.

• Program – lengthy contract T&C’s negotiations and revenue

commencement objectives compressed the program.

Lessons

• Identify structurally sound inverter locations early and before

tender documentation stage.

• Early discussions with authorities on network approvals and grid

connections was hugely valuable.

• Allow more time for final design once at preferred contractor

status, and for mobilisation and orientation on site.

• Keeping embedded network and solar infrastructure separate;

having solar connection points made interface simpler.

• Using trusted sub contractors familiar with the site saved time and

Pushing live output data to external management systems

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System Performance to Date

• Total annual output – 1,740,000 kWh; Commissioned May/June 2015

• Total generation output to 31 March 2016 – 1,452,765 kWh; (Target

1,417,540 kWh)

• Value of electricity generated since commissioning - $261,500; Annually

- $295,800 (@ $0.18 c/kWh)

• Value of Large Scale Generation Certificates (LGC’s) annually at current

price of $79.60 per MWh - $138,504

Awards and what’s next?

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• NSW 2015 Green Globe Awards - Winner

(Energy Efficiency)

• Clean Energy Council 2015 Solar Design and

Installation Awards - Finalist (Systems over

100kW).

• Stockland Chairman’s Award for Innovation

2015 - Winner (New Product and Revenue

Enhancement).

• Solar feasibilities being undertaken across

entire Retail portfolio with embedded

networks.

• 700 kW system to be installed as part of

Stockland Green Hills redevelopment (2018).

• 900 kW system to be installed at another

centre not yet announced (2016).

Stockland Corporation Limited

ACN 000 181 733

Stockland Trust Management Limited

ACN 001 900 741

25th Floor

133 Castlereagh Street

SYDNEY NSW 2000

Disclaimer Of Liability

While every effort is made to provide accurate and complete information, Stockland does not warrant or

represent that the information in this presentation is free from errors or omissions or is suitable for your

intended use. The information provided in this presentation may not be suitable for your specific

situation or needs and should not be relied upon by you in substitution of you obtaining independent

advice. Subject to any terms implied by law and which cannot be excluded, Stockland accepts no

responsibility for any loss, damage, cost or expense (whether direct or indirect) incurred by you as a

result of any error, omission or misrepresentation in information in this presentation.

All information in this presentation is subject to change without notice.