Residents and business owners could have their electricity bills slashed by hundreds of dollars each year in a radical plan proposed by Melbourne’s Lord Mayor.

Councillor Nick Reece has pledged to implement Australia’s largest community-led bulk purchasing scheme for renewable energy across Melbourne – if he is re-elected as Lord Mayor.

Under the M-Power initiative, The City of Melbourne would use the collective buying power of households and small businesses to secure the lowest possible rates for renewable electricity – in what Cr Reece says could save Melburnian’s hundreds of dollars each year.

The initiative wouldn’t just benefit City of Melbourne residents, but would include other inner-city councils Darebin, Hobsons Bay, Maribyrnong, Merri-bek, Moonee Valley, Port Phillip, Stonnington, and Yarra.

“The MPower initiative will give more than one million Melburnians the chance to save money on their energy bills and help make the switch to renewable energy,” Reece said on Friday.

“Bulk purchasing works and we know that it can reduce power bills by hundreds of dollars a year, while also delivering big cuts to greenhouse gas emissions.”

Deputy Lord Mayor Candidate Roshena Campbell has thrown her support behind the plan.

“Local government is not the cause of increasing electricity costs, but we can help provide a solution,” she said.

The scheme is expected to cost the City of Melbourne up to $2 million in addition to staffing costs, with the funding to be reallocated from within its existing budget.

If Reece is successful, consultations and negotiations for MPower will begin in 2025, with the first contracts expected to be available in 2026.

It’s not the first time a local council has taken up the fight against rising energy bills. In 2023, NSW’s Northern Beaches Council started a similar initiative to the one proposed in Melbourne.

Their initiative granted small and medium-sized businesses access to exclusive energy deals that are typically out of reach for smaller players.

South Australia’s City of Mitcham also introduced a Community Renewables Program in 2021 by bulk-buying solar panels and batteries for residents, businesses, sporting clubs and associations to accelerate their uptake of renewable energy technologies.

-AAP