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VEET Review - Questions
1.
What should the new VEET target be?
Please indicate your preferred option:
• 5.4 million tonnes CO2-e per year for three years
• 5.8 million tonnes CO2-e per year for three years
• 6.2 million tonnes CO2-e per year for three years
• 5.8 million tonnes CO2-e per year for five years
• 6.2 million tonnes CO2-e per year for five years
Other option (please specify level of target and length)
AGN regards the VEET as the pre-eminent Australian Energy Efficiency Scheme. The scheme has worked well
over a number of years, and the certainty and stability provided by the scheme is valued. By way of contrast, the
current energy market is characterised by significant concerns relating to energy pricing, supply and associated
policy issues.
AGN’s rationale for retaining the current target for the standard 3 year period is simply that AGN is confident the
ESS scheme will continue to deliver energy efficiency and emissions reduction outcomes with certainty. AGN is
not as comfortable or confident that same will occur with a higher target or a longer period. For those reasons
AGN recommend that the new VEET target should be:
5.4 million tonnes CO2-e per year for three years
2. Comments are invited on the modelling approach used to determine the costs and benefits of the
VEET scheme.
Is there any additional data or information that should be considered?
AGN is comfortable with the modelling approach undertaken.
3. Which greenhouse gas coefficient should be used to quantify the reduction in greenhouse gas
emissions achieved by the VEET scheme?
• existing marginal coefficient
• updated marginal coefficient
• an average coefficient (as published in the National Greenhouse Accounts)
• other option (please specify?)
Please outline why you believe this option is preferred.
On the basis of national consistency and harmonisation, AGN believes that Greenhouse gas coefficient to be
used should be that determined by the National Greenhouse Accounts.
4. The Department has valued greenhouse gas emissions reductions attributed to the VEET scheme by
adopting a carbon valuation series that was produced by the Federal Climate Change Authority as part of
its 2014 Targets and Progress Review.
Is this approach appropriate for valuing greenhouse gas emissions reductions over the period 2016 to 2050?
AGN believes this national approach to valuing greenhouse gas emissions is appropriate.
5. Is there a case to exclude any business sector(s) from participation in the VEET scheme?
Please explain why this is your preferred option, and comment on how this should be implemented.
All business sectors should be able to participate in the scheme. However, AGN also believes that each business
sector should have the right to seek exclusion from the scheme, if that business believes that its involvement will
not benefit energy consumers, or that it will be unduly affected by scheme involvement. Indeed, the participation
of businesses such as Emission Intensive Trade Exposed Industries should be considered carefully.
If businesses already participate in other similar compulsory state or federal government schemes, they could be
considered for scheme exclusion, to avoid double dipping and duplication.
6. Should the VEET scheme be amended to better ensure support for low income households?
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Please outline how the VEET scheme could better support low income households, and comment on why this
option should be preferred.
AGN believes that policies should exist to support low income households, and that this support could recognise
the impact of energy prices. That policy support however, should be provided external to the VEET scheme,
which has as its primary purpose, an energy efficiency objective.
Support for low income and hardship households should be provided by other social policy mechanisms, and not
‘mixed’ in with the VEET process, a potential outcome that, in AGN’s view, could distort both hardship and energy
efficiency outcomes.
7. In addition to expanding the range of energy efficiency activities available in VEET, should any other
action be taken to target participation by certain groups?
AGN is unaware of other groups who should be targeted for scheme participation.
8. Please suggest up to five activities that should be prioritised for revision or introduction to the VEET
scheme.
Please outline why you believe these activities should be prioritised.
AGN believes that the below activities should be considered as a priority for scheme inclusion.
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Gas Powered Air conditioning technologies
Co-gen and Tri-generation technologies
The inclusion of these technologies offers potential energy efficiency improvements, cost savings and emissions
reduction.
Further, AGN believes that the below activities could be considered for future inclusion in the scheme for the
reasons set out above.
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Gas Powered Chillers
Gas Fuel Cells
Natural Gas Vehicles
Concepts such as like Precinct Energy
9. Please suggest up to three changes which should be made to improve the VEET scheme.
Please outline why you believe these changes should be a priority.
As stated earlier in this response, AGN regards the VEET scheme highly. It has operated with roven stability and
certainty over the years, and been consistently supported by a balanced and careful approach to ongoing
improvement.
AGN understands that, in certain situations, both a federal (STC) and state (VEEC) incentive can be created for
the one appliance transaction. If this is the case, it represents an inefficient expenditure of funds and a form of
‘double dipping’.
AGN recommends that the VEET team review this issue.
The NSW ESS scheme does not reward energy efficiency projects, if the project has already received funds
under the ERF scheme. A similar approach is applied under the ESS, where an STC payment has been made
i.e. no double dipping under the ESS does not occur.
If nothing else, the above points establish the opportunity for future harmonisation.