Sembcorp invests 77% stake in Vellocet Clean Energy for $5m

It will tap into Australia’s direct supply of renewable energy to companies.

Sembcorp Industries (Sembcorp) subsidiary Sembcorp Energy Australia invested a 77% stake in Vellocet Clean Energy (VCE) for $5m, allowing it to grow in the Australian power market, particularly in the direct supply of renewable energy to companies.

According to an announcement, VCE is an Australian company offering clean energy solutions. It offers behind-the-meter power and microgrids which enable customers to save on high network and retailer costs, as well as mid-size front-of-meter power supply and generation.

VCE targets the market for corporate power purchase agreements (PPAs). Sembcorp said the company is in active talks with potential customers and has memoranda of understanding for a number of solar power projects.

Sembcorp CEO and group president Neil McGregor commented, “In Australia, the retirement of older coal-fired facilities is creating a significant opportunity for the growth of cleaner energy solutions. At the same time, high retail power tariffs and network and transmission costs have resulted in a favourable outlook for corporate PPAs and distributed energy. Against this background, it is an opportune time for Sembcorp to move into the market.”