Financing the Low-Carbon City: Can Local Government Leverage Public Finance to Facilitate Equitable Decarbonisation?

Abstract

As decarbonisation interventions proliferate within cities, local governments setting ambitious targets are increasingly engaged in complex financial relations. Recognising the necessary cost of renewable and energy efficient infrastructures, and the ever-present constraints on public funds, this paper argues that finance is a critical node through which local governments advance decarbonisation in urban localities. While local decarbonisation strategies have been viewed cautiously for their potential to overburden individuals at the expense of more systematic and organisational change, this paper reveals a more complex picture. Drawing on decarbonisation initiatives in two Melbourne municipalities—Moreland and Darebin—it identifies four ways in which local governments are using public finance to achieve their sustainability objectives. Local governments are brokering bulk product purchases for residents; lending upfront capital for solar PV via local property taxes; purchasing energy efficient products and funding innovative technology pilots; and procuring renewable energy supply through multi-stakeholder power purchase agreements. By targeting lower income households and pooling resources with other organisations, the paper shows that local governments can address socio-economic inequality and facilitate extra-local change towards a low-carbon city. However, these incremental achievements emphasise the need for co-ordination and state engagement to realise decarbonisation at a meaningful scale.

城市减碳措施越来越多，市政府定下的远大目标与财政的关系也越来越复杂。本文指出了 可再生且高能效的基础设施的必要成本，以及公共资金历来面临的压力，认为地方政府在 城市地区推广减碳，财政是关键。人们一直认为，若没有较大的系统性和组织性变化，地 方减碳策略就可能给个体造成沉重负担，因此对这些策略持谨慎态度。而本文发现情况远 比这个复杂。文章考察了墨尔本市的两个区，莫兰（Moreland）区和戴尔滨(Darebin)区， 发现区政府利用公共资金达到可持续目标的方法可归纳为四种: 组织居民团购商品、用当 地房产税贷款建设太阳能光伏网、购买高能效产品并为新技术试点投资、通过多方电力购 买协议促进可再生能源供应。研究指出地方政府可以通过资助低收入家庭和与其他组织共 聚资源的方法，解决社会经济不平等的问题，全面推进低碳城市建设。但这些增量变化必 须有政府的协调和参与，才能使减碳达到有效规模。

Keywords:

• Finance
• decarbonisation
• governance
• urban political ecology
• cities
• local government
• Melbourne

View correction statement:

Correction to: Hadfield and Cook N. Financing the Low-Carbon City: Can Local Government Leverage Public Finance to Facilitate Equitable Decarbonisation?

Acknowledgements

We would like to thank all research participants for their generosity and time. We would also like to thank two anonymous referees for their detailed feedback on this paper. Warm thanks to Christopher Cook for providing the illustrations in Figure 1.

Notes

This article was originally published with an error. This version has been corrected. Please see Erratum (https://doi.org/10.1080/08111146.2018.1436923).

1. “City” in “City Council” refers to the Local Government Area (LGA); metropolitan Melbourne comprises 31 LGAs.

2. The NEM is ‘national’ in name, however it only encompasses the east and south-east coasts of Queensland, New South Wales, the Australian Capital Territory, South Australia, Victoria, and Tasmania.

3. At 2016, estimated resident populations for Moreland and Darebin LGAs were 170,615 and 153,563 respectively (ID Consulting 2017). Energy data published by the Northern Alliance for Greenhouse Action (NAGA) indicates that resident electricity consumption averages 4.8 kWh per day in both LGAs (based on data at 2013) (NAGA 2015). By sector, Darebin’s industrial electricity emissions are higher than Moreland’s, while both have similar levels of residential, commercial and gas-related electricity emissions (NAGA 2015).

4. Moreland City Council and Darebin City Council; Victorian Dept. Economic Development, Jobs, Transport and Resources; Moreland Energy Foundation Limited (MEFL) and the Centre for Education and Research in Environmental Strategies (CERES); Northern Alliance for Greenhouse Action; Climate Action Moreland, Moreland Community Solar, Yarra Community Solar, Coalition for Community Energy, Community Power Agency, and The People’s Solar; Brunswick Secondary College; Powershop; Energy Matters; Hip V. Hype; Beyond Zero Emissions and the Alternative Technology Association.

5. The consortium includes City of Port Phillip, City of Yarra, Next DC, Melbourne Convention Exhibition Centre, Fed Square, The University of Melbourne, NAB, Bank Australia, Citywide, RMIT University, Zoos Victoria, and Australia Post (City of Melbourne 2016).