Changes to Victoria's Energy Efficiency Target

21 Sep 2011Archived News Climate Change Matters

From 1 January 2012 the Victorian Energy Efficiency Target (VEET) will be expanded to cover business users. VEET has been in place since 1 January 2009, with a target of reducing greenhouse gases by 2.7 million tonnes per annum across residential customers.

With the expanded coverage, the annual reduction target will increase to 5.4 million tonnes per annum across all electricity and gas users. Whilst legislation changes were approved earlier this year, final technical aspects of the expanded scheme will not be released until later this year.

Modelling undertaken on behalf of Victoria's Department of Primary Industries predicts that costs incurred by energy retailers in meeting their VEET obligations will be more than offset by reduced energy commodity prices (the modelling predicts commodity prices to fall due to lower energy demand in Victoria).

Energetics provides discussion paper on the extension of the Energy Savings Incentive to the business sector

A list of eligible activities is prescribed in the Victorian Energy Efficiency Target Regulations 2008. The Regulations use a "deemed" abatement methodology under which the lifetime greenhouse gas abatement associated with each activity is calculated and assigned upfront to certificate creators, in the form of tradeable Victorian Energy Efficiency Certificates (VEECs).

The Department of Primary Industries (DPI) engaged Energetics to help develop abatement methodologies for the range of activities covering the business sector to be included in the Regulations from the end of 2011. The discussion paper developed by Energetics in consultation with the Department is now available on the Victoria Essential Services Commission's website.

This work may provide insight into the types of abatement options we’ll see in a National Energy Savings scheme. 

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