By Paul Hemsley and Julian Bajkowski

The City of Sydney has pulled the plug on its landmark $500 million project with energy services provider Cogent Energy to develop a home-grown trigeneration energy program, blaming the federal government’s decision to lower the future carbon price, regulatory changes, inflexible electricity networks and the removal of ‘precinct’ based incentives.

The City says that its decision to halt the massive project was influenced by the potential reduction in the federal government’s carbon price, which has diminished the commercial case for some of the City’s trigeneration precincts.

Trigeneration, which is most commonly used in energy intensive environments like datacentres and heavy industrial plants, normally uses a gas-fired engine to produce electricity that can also harness and reuse exhaust heat to produce both hot water and chilled water for cooling through thermal inversion.

The City of Sydney’s grand vision for tri-generation was supposed to enable it to produce much cleaner power at peak times and wean the local government of carbon intensive coal-based electricity.

Opponents of the Trigeneration scheme and Lord Mayor Clover Moore wasted no time in labelling its collapse a symptom of an overambitious green agenda that had degenerated into “fanatasy”.

“With an inability to deliver major projects on time, the city staff have done the right thing to recommend walking away from this nutty plan,” said Liberals councillor Edward Mandla.

“It's time for technologists to step up and to create real power alternatives that stack up rather than bureaucrats developing back-of-beer coaster schemes [that] only work with ridiculous incentives.

The deal between the City of Sydney and Origin’s subsidiary Cogent Energy was a major development in the City’s pro-sustainability agenda when it was announced in April 2012.

The most prominent example publicised by the City was the planned installation of trigeneration at the City’s long-delayed Green Square Town Centre project that aims to transform a wasteland into a leading example of low-emission urban design.

The trigeneration project at Green Square also received support from the federal government when the Department of Infrastructure and Transport provided $3.75 million under the Liveable Cities program worth $20 million.

But the trigeneration component of the Green Square project has now been officially put the backburner following the City of Sydney’s because the City of Sydney has decided that the first trigeneration project planned for the precinct does not meet performance targets necessary for the project to progress.

It is a substantial roadblock for the Lord Mayor Clover Moore’s ambitious plan to create a “carbon neutral” city by implementing reforms to the city’s energy consumption methods, as the Green Square project was expected to be the centrepiece of the council’s wider sustainability strategy.

City of Sydney CEO Monica Barone said the economics of trigeneration at Green Square “don’t stack up now”.

Although Ms Barone has put trigeneration at Greeen Square on hold for now, she suggested that the council still believes a future trigeneration network in the precinct is viable.

She revealed that the council will soon consider a development application by Cogent for the building that will house a future trigenation plant in Green Square that will be valid for up to five years if it is approved.

“The City will revisit trigen in Green Square once the regulatory environment makes it more attractive for large scale precincts. We believe climate change is the most pressing issue for every government, and our resolve on cutting carbon emissions is as strong as ever,” Ms Barone said.

The council’s decision has meant that Cogent will not be able to participate in any revamp of the Green Square project, but the City has invited the company to tender for other trigenerations projects within the CBD including the council’s own buildings such as a plant to provide electricity, heating and cooling to Sydney Town Hall, Town Hall House and the Queen Victoria Building.