Energy costs for South Australian councils will rise by between 29 and 50 per cent in 2017 as a result of power supply contracts negotiated by Local Government Association (LGA) Procurement late last year.

In its submission to this year’s State Budget, released to InDaily, the LGA has warned rising energy costs “will put pressure on council rates”.

It is asking the Government to fund an “energy productivity program” to help councils pay for energy-efficiency projects such as battery storage, solar systems and the conversion of public streetlights to LEDs.

“Like any business of scale, local government isn’t immune to electricity price cost pressures and two new energy (electricity) supply contracts negotiated by LGA Procurement on behalf of councils will see costs increase by 30-50% in 2017,” the submission reads.

“The LGA has sought feedback from councils and has identified a number of projects that would benefit from an Energy Productivity Program; including battery storage, energy efficiency reviews, solar systems and conversion of public lights to LED.

“This program would be of significant positive benefit to local councils and their communities as these projects are unlikely to proceed without funding support.”

Councils are already eligible for funding under the State Local Government Infrastructure Partnership, under which the Government offers 20 per cent funding for selected projects.

The Government yesterday announced it had given a Riverland council $5 million under the partnership to help fund a $25 million, 10-megawatt solar plant at Berri.

The project, led by Accolade Wines and the Central Irrigation Trust, is aimed at stabilising energy supply.

So far, councils across the state have received $23 million from the partnership.

However, the LGA says it wants a new fund, dedicated exclusively to energy projects.

LGA executive director public affairs Lisa Teburea told InDaily councils needed a dedicated fund for energy projects “so that the energy projects aren’t competing with other projects”.

Teburea said the LGA would discuss the size of the proposed fund with the Government.

“At this stage, we haven’t discussed a number with the government … [but we hope to] work out something that will see a lot of energy projects progress,” she said.

She added that the energy projects would deliver long-term savings for councils.

Switching to energy-efficient LEDs has proved problematic for some councils.

In August, a tender process to replace thousands of streetlights across eastern Adelaide was abandoned, after an independent review sparked by reports in InDaily found the conduct of the seven eastern Adelaide councils responsible – the Eastern Region Alliance – was “not satisfactory”.