PLEASE NOTE
The Australian Government is undertaking further design work on a possible national Energy
Savings Initiative (ESI). Reports, such as the one which is provided below, have been prepared
by consultants to assist with this work. However:
•
no decision has been made about whether a national ESI will be introduced;
•
the report should not be interpreted as reflecting Government thinking on the design of
a possible national ESI (for example, comments by consultants about the eligibility of
activities for creating certificates should not be interpreted as a proposed list of eligible
activities under a possible national scheme); and
•
the report should not be interpreted as a commitment by Government to a policy or
course of action.
Investigation of deemed savings
for residential activities in a
possible National Energy Savings
Initiative
Prepared for
Department of Climate Change and Energy
Efficiency
June 2012
655 Jacksons Track
Jindivick, Victoria 3818
Australia
ABN: 18 090 579 365
Tel: +613 5628 5449
Fax: +613 9923 6175
Email: info@energyconsult.com.au
National ESI: Preliminary research and development of deeming methodologies
June 2012
Disclaimer
This report was prepared by EnergyConsult Pty Ltd, ABN 18 090 579 365 for the Department of Climate Change
and Energy Efficiency, as part of the Commonwealth’s efforts to investigate the merits of a possible National Energy
Savings Initiative.
EnergyConsult disclaims all liability to any party other than the Department of Climate Change and Energy
Efficiency for all costs, loss, damage and liability that the third party may suffer or incur arising from or relating to or
in any way connected with the use of this report by the third party without our prior written consent. Any
commercial decisions or regulatory decisions taken by the Department of Climate Change and Energy Efficiency are
not within the scope of our duty of care. In making such decisions the Department of Climate Change and Energy
Efficiency should take into account the limitations of the scope of our work, reliance on third party data, and other
factors, commercial and otherwise, of which the Department of Climate Change and Energy Efficiency should be
aware.
Commonwealth Government Disclaimer
This report provides information about potential deeming methodologies that could be used for a possible National
Energy Savings Initiative and is provided on the understanding that the Commonwealth is not providing
professional advice. The report includes views and opinions of third parties and does not necessarily reflect the views
of the Commonwealth or any State or Territory Government, or indicate a commitment to a particular policy or
course of action.
While reasonable efforts have been made to ensure that the report is accurate, correct and reliable, the
Commonwealth accepts no liability for the accuracy of, or inferences from, the material contained in the report, and
expressly disclaims liability for any person’s loss arising directly or indirectly from the use of, inferences drawn,
deductions made, or acts done in reliance on this report.
Copyright
© Commonwealth of Australia 2012
This work is copyright Commonwealth of Australia. All material contained in this work is copyright the
Commonwealth of Australia, except where a third party source is indicated.
With the exception of the Commonwealth Coat of Arms, any departmental logos, Commonwealth copyright
material is licensed under the Creative Commons Attribution 3.0 Australia Licence. To view a copy of this license,
visit http://creativecommons.org/licenses/by/3.0/au/.
You are free to copy, communicate and adapt the Commonwealth copyright material, so long as you attribute the
Commonwealth of Australia (Department of Climate Change and Energy Efficiency).
Permission to use third party copyright content in this publication can be sought from the relevant third party
copyright owner/s.
i
National ESI: Preliminary research and development of deeming methodologies
June 2012
Contents
Executive Summary
1
Introduction
vii
1
1.1
Project Methodology
2
1.2
Contents of Report
3
2
Overview of Deeming Methodologies for Activities in State-Based Energy Saving
Schemes
5
3
Water Heating Activities
3.1
3.2
3.3
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
3.1.1
3.1.2
3.1.3
BAU Scenarios and Additionality Issues
15
Water Heater Market
Market and Regulatory Trends
15
16
17
17
19
19
Recommended Activity Specification and Deemed Savings
20
Description and Specification of Activity
The Calculations and Deemed Energy Savings
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
4.1.1
4.1.2
4.1.3
4.2
4.3
5.2
5.3
5.4
26
26
27
29
BAU Scenarios and Additionality Issues
31
Heating and Cooling Appliance Market Summary
Market and Regulatory Trends
Additionality Issues
Recommended Activity Specifications and Deemed Savings
Description and Specification of Activity
The Calculations and Deemed Energy Savings
Space Conditioning Activities
5.1
26
30
4.4.1
4.4.2
5
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
20
22
Review of Market
4.2.1
4.2.2
4.3.1
4.4
12
13
Replacing Existing Heaters
Early Retirement of Operating Water Heaters
Retrofitting of Solar Kits to Existing Water Heaters
Upgrading Water Heaters for New Housing
Allocating Deemed Savings According to Water Heater Size
Additionality Issues
Space Heating and Cooling Activities
4.1
8
10
12
12
3.4.1
3.4.2
4
8
Review of Market
3.2.1
3.2.2
3.3.1
3.3.2
3.3.3
3.3.4
3.3.5
3.3.6
3.4
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
8
30
31
32
32
32
35
42
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
42
Review of Market
44
BAU Scenarios and Additionality Issues
46
Recommended Activity Specifications and Deemed Savings
47
5.1.1
5.1.2
5.1.3
5.2.1
5.2.2
5.3.1
5.4.1
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
Market Summary
Market and Regulatory Trends
Additionality Issues
Description and Specification of Activity
42
43
44
44
45
46
47
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National ESI: Preliminary research and development of deeming methodologies
5.4.2
6
June 2012
The Calculations and Deemed Energy Savings
Installing Low Flow Showerhead Activity
6.1
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
6.1.1
6.1.2
6.1.3
6.2
Review of Market
6.2.1
6.3
6.5
Market Summary
59
The Calculations and Deemed Energy Savings
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
7.1.4
7.1.5
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
Description and Specification of Activities
The Calculations and Deemed Energy Savings
9.4
67
68
70
71
BAU Scenarios and Additionality Issues
71
Recommended Activity Specification and Deemed Savings
71
Television Market
Market and Regulatory Trends
Description and Specification of Activities
70
70
70
71
71
71
72
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
72
Review of Market
73
9.2.1
9.2.2
9.3
65
65
Review of Market
9.1.1
9.1.2
9.1.3
9.2
65
70
State Activities’ Descriptions
Analysis of Deeming Methodology
Evaluation of Methodology
Pool Pumps
9.1
62
64
64
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies
8.4.1
9
62
67
8.2.1
8.2.2
8.4
62
Recommended Activity Specification and Deemed Savings
8.1.1
8.1.2
8.1.3
8.3
60
66
Televisions
8.2
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
72
72
73
Pool Pump Market
Market and Regulatory Trends
73
73
BAU Scenario and Additionality Issues
73
Recommended Activity Specification and Deemed Savings
74
9.4.1
10
Lighting Market
Market and Regulatory Trends
59
BAU Scenarios and Additionality Issues
7.3.1
7.3.2
8.1
57
Description and Specification of Activity
Review of Market
8
57
59
7.1.1
7.1.2
7.1.3
7.3
56
56
57
Recommended Activity Specification and Deemed Savings
Additionality Issues
Lighting Activities
7.2
56
58
6.5.1
7.1
56
BAU Scenarios and Additionality Issues
6.3.1
6.4
7
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
51
Description and Specification of Activity
Efficient Whitegoods Activities
10.1
10.1.1
74
75
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies 75
State Activities’ Descriptions
75
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National ESI: Preliminary research and development of deeming methodologies
10.1.2
10.1.3
10.2
10.2.1
10.2.2
Recommended Activity Specification and Deemed Savings
82
Description and Specification of Activities
The Calculations and Deemed Energy Savings
Fridge Disposal Activities
82
83
89
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies 89
State Activities’ Descriptions
Comparison of Deeming Methodologies
Evaluation of Methodologies
89
91
91
11.2
Review of Market
91
11.3
BAU Scenario and Additionality Issues
92
11.4
Recommended Activity Specification and Deemed Savings
92
11.4.1
11.4.2
Fridge Market
Market and Regulatory Trends
Description and Specification of Activity
The Calculations and Deemed Energy Savings
In-home Displays
12.1
12.1.1
12.1.2
12.1.3
12.2
12.2.1
12.2.2
91
92
92
92
94
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies 94
State Activities’ Descriptions
Analysis of Deeming Methodology
Evaluation of Methodologies
Review of Market
IHD Market
Market and Regulatory Trends
94
94
95
95
95
95
12.3
BAU Scenario and Additionality Issues
95
12.4
Recommended Activity Specification and Deemed Savings
96
12.4.1
12.4.2
Description and Specification of Activity
The Calculations and Deemed Energy Savings
Standby Power Controller
13.1
13.1.1
13.1.2
13.1.3
13.2
13.2.1
13.3
13.3.1
13.3.2
15
77
79
10.4
11.2.1
11.2.2
14
77
80
11.1.1
11.1.2
11.1.3
13
Whitegoods Market
Market and Regulatory Trends
BAU Scenario and Additionality Issues
11.1
12
Review of Market
77
77
10.3
10.4.1
10.4.2
11
Comparison of Deeming Methodologies
Evaluation of Methodologies
June 2012
96
96
97
Review of State-Based Energy Savings Schemes Activities and Deeming Methodologies 97
Descriptions of State Activities
Comparison of Deeming Methodologies
Evaluation of Methodologies
97
97
99
Review of Market
100
Market Summary
100
Recommended Activity Specification and Deemed Savings
Description and Specification of Activity
The Calculations and Deemed Energy Savings
MEPS and Performance Standards in International Energy Saving Schemes
100
100
101
103
14.1
Introduction
103
14.2
MEPS and State Scheme Action Criteria
103
14.3
New Zealand Energy Star
108
14.4
United Kingdom Energy Savings Trust, CERT and Capital Allowance Scheme
109
14.5
Energy Efficiency Obligation Programs in the EU
109
Peak Demand Savings, Low Income Households Savings and Other NESI Design Issues113
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National ESI: Preliminary research and development of deeming methodologies
June 2012
15.1
Peak Demand Savings
113
15.2
Low Income Households
115
15.3
Encouraging Deep and/or Bundled Retrofits of Existing Building Stock
116
15.4
Program Design and Deeming Methodologies
116
16
References
118
17
Glossary
120
18
Appendix: Lifetime of Activities in State Schemes
121
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National ESI: Preliminary research and development of deeming methodologies
June 2012
List of Tables
Table 1: Energy savings activities in state schemes
6
Table 2: Water heater installations relevant to REES and VEET schemes
9
Table 3: Sources of energy used in water heating (ABS 2011)
13
Table 4: Recommended water heater activities
21
Table 5: Deemed energy savings (GJ) from water heater activities
24
Table 6: Deemed energy savings (GJ) from new water heater installations in Western Australia and
the Northern Territory
25
Table 7: Energy use comparison for fuel switching water heater activities (in GJ)
25
Table 8: Space heating and cooling activities relevant to REES and VEET schemes
27
Table 9 - Australian penetration of heating and cooling in households (percentage)
30
Table 10: Recommended space heating/cooling activities
33
Table 11: Recommended specifications of heater/cooler appliance size
35
Table 12: Deemed energy saving (MJ) from replacement or upgrading of gas or heat pump room
heater
37
Table 13: Deemed energy saving (MJ) from replacement or upgrading of room air conditioner
38
Table 14: Deemed energy saving (GJ) from replacement or upgrading of ducted heating
39
Table 15: Life time energy saving (MJ) from replacement of refrigerative air conditioner with ducted
evaporative air conditioner
41
Table 16: Life time energy saving (MJ) from duct work replacement for ducted gas heater
41
Table 17: Space conditioning activities relevant to REES and VEET schemes
42
Table 18: Lifetimes of space conditioning activities in Australian schemes
52
Table 19: Estimated deemed energy saving (MJ) from space conditioning activities
54
Table 20: Estimated deemed energy saving (MJ) from additional space conditioning activities
55
Table 21: Deemed energy saving (MJ) per low flow showerhead installed
61
Table 22: State lighting activities
63
Table 23: State television activities
70
Table 24: State pool pump activities
72
Table 25: State whitegoods activities
76
Table 26: Fridge/freezer sales and sales-weighted star rating (source: EES 2010B)
78
Table 27: Other whitegoods sales-weighted star rating (source: EES 2010B)
79
Table 28: Fridge and freezer constants
84
Table 29: State fridge disposal activities
90
Table 30: VEET IHD activities
94
Table 31: Preliminary deemed energy saving master-slave SPC
102
Table 32: Comparison of minimum standards of state scheme activities, Australian MEPS and
international schemes
104
Table 33: Potential peak demand benefits of activities
114
Table 34: Lifetime of energy savings activities in state schemes (years)
121
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Executive Summary
The Australian Government has committed to undertake further work on a possible
National Energy Savings Initiative (NESI), as part of the Clean Energy Future plan.
Energy saving initiatives are market-based tools for driving economy-wide improvements
in energy efficiency.
The Department of Climate Change and Energy Efficiency (‘the Department’)
commissioned EnergyConsult, teaming with Steve Beletich,
to investigate and
recommend a draft set of deeming methodologies for possible residential energy saving
activities for a National Energy Savings Initiative (NESI).
This report has reviewed the deeming methodologies used in the existing Australian statebased energy-saving schemes and compared the methodologies used in the schemes. It
was found that for most residential energy savings activities, the deemed saving
methodologies developed for the Victorian, South Australian and New South Wales
schemes were very similar. Generally differences only occurred due to differences in
assumptions made in the calculations. A review of these methodologies showed that
national deeming methodologies could be developed which would be applicable for all
Australian jurisdictions.
Potential deeming methodologies for a NESI were then developed by adapting the
existing methodologies of the state schemes and have been documented in this report.
Estimates of the energy savings for a range of energy savings initiatives have been
calculated and listed. EnergyConsult recommends that the resulting deemed energy
savings values for the activities be regarded as preliminary calculations only at this stage.
There are a number of reasons for these results being regarded as preliminary calculations,
including:

the design of a possible NESI and its aims and goals have yet to be
specified, so selection and specification of appropriate energy savings
activities are only tentative;

detailed specifications of activities need to be developed before deemed
savings calculations can be finalised;

local regulations in each of the relevant jurisdictions at the time that a
NESI might be implemented need to be considered, as these may strongly
influence the specification and lifetime of the activities; and

market and regulatory changes are occurring rapidly, so the assumptions
used in deeming calculations are appropriate for current conditions but
may require review before implementation of a possible NESI in the
future.
Finally, thermal modelling is an important input to the deeming calculations of many
activities, especially those concerning space conditioning improvements, and access to
such modelling was not available for the majority of jurisdictions in an appropriate form
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National ESI: Preliminary research and development of deeming methodologies
June 2012
for the authors to use for the present report. EnergyConsult advise that the deeming
calculations for space conditioning improvements be reviewed when the thermal
modelling of space conditioning improvements for all jurisdictions is available.
The deeming methodologies used in international schemes were also researched but it was
found that detailed information on these methodologies was not available and differences
in the markets, climates and measurement metrics in other countries will make these
methodologies of limited relevance to Australia. Research on the factors considered in
the development of European deeming methodologies though shows that all relevant
factors have been considered in the development of the deeming methodologies for the
Australian state-based energy-saving schemes. Consequently, the methodologies used in
the Australian state-based schemes were the prime source of information and ideas for
developing the deeming methodologies for a possible NESI.
In conclusion, the deeming methodologies and preliminary calculations of the energy
savings from a range of energy savings actions, which may be applicable for a NESI, have
been developed based on approaches taken in existing state schemes and documented in
this report. EnergyConsult suggests that, when the ultimate design of a NESI is decided
and the energy savings actions specifications developed, the deeming methodologies and
calculations should be reviewed to ensure consistency with the final specifications of the
actions, and to allow for changes in the market and regulatory environment. Where
required, additional thermal modelling information should be incorporated into the
deeming methodologies.
viii
National ESI: Preliminary research and development of deeming methodologies
June 2012
1 Introduction
The Australian Government has committed to undertake further work on a possible
National Energy Savings Initiative (NESI), as part of the Clean Energy Future plan.
Energy saving initiatives are market-based tools for driving economy-wide improvements
in energy efficiency and further work on a possible NESI will involve detailed policy
analysis, economic and energy market modelling and consultation with the community,
industry and state and territory governments. The Government’s decision to undertake
further work on a possible NESI follows from the report of the Prime Minister’s Task
Group on Energy Efficiency, which recommended that the Government ‘agree to the
introduction of a transitional national energy savings initiative to replace existing and
planned state energy efficiency schemes, subject to detailed consultation on its design.’
The Clean Energy Future plan outlined that factors that would be considered in the
design of a possible NESI would include:





economy-wide targets to maximise the benefit of the scheme;
sectoral and fuel coverage issues;
incentives or requirements to create certificates in low-income households and
in ways which reduce electricity demand at peak times;
energy saving activities which would be eligible; and
managing a smooth transition from state-based schemes.
Subject to economic modelling and a regulatory impact analysis, the Commonwealth
Government will make a decision on whether to adopt a national energy savings initiative.
Any Commonwealth Government decision to proceed with a national Energy Savings
Initiative will be conditional on the agreement of the Council of Australian Governments.
The Department of Climate Change and Energy Efficiency (‘the Department’)
commissioned EnergyConsult, teaming with Steve Beletich,
to investigate and
recommend a draft set of deeming methodologies for possible energy saving activities in
the residential sector. The aim of the project was to conduct research and develop a
nationally consistent set of deemed energy saving estimation methodologies for residential
activities, based on the categories of activities currently used in the existing state energy
savings schemes. Several potential new additional activities were also explored. There are
currently three main state energy savings schemes operating in Victoria, NSW and South
Australia. A fourth residential scheme in the ACT is being implemented according to
similar rules as the Victoria scheme, though the ACT scheme is to become an
independent, non-certificate based scheme, closely modelled on the South Australian
REES, in 2013.
The outcomes from this project are presented in the following report and will inform
policy development and ongoing consultation relating to the design of a possible NESI,
including the development of options and modelling inputs for the regulatory impact
analysis.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
1.1 Project Methodology
The methodology originally proposed for the research and development of the deeming
methodologies for a possible NESI consisted of the following tasks:

review activities and deeming methodologies in existing state schemes;

review international schemes and Australian and international Minimum
Energy Performance Standards (MEPS); and

develop deeming methodologies for a possible NESI, drawing on the
reviews of the state and international schemes.
Further examination of the development of the deeming methodologies led to the
conclusion that the key factors relevant to the deeming methodologies vary between
Australia and other countries, as follows:

Business-as-usual (BAU) Scenario: Critical to the development of any deeming
methodology is the specification of the BAU scenario, i.e. what activity would have
occurred without the intervention of the scheme and what would have been the
resulting energy use. Development of this scenario requires detailed information
about the regulatory and market environment that will affect the BAU scenario. For
example, it is necessary to have information concerning existing building/appliance
stock, sales of the relevant building intervention or new appliances, average
efficiency of existing and new buildings/appliances, relevant regulatory
interventions and when they are occurring or have occurred, and current uptake of
the proposed action. Due to the number of variables that can affect the BAU
scenarios, the BAU scenario used in international energy efficiency programs will
invariably differ from the scenario relevant to Australian NESI activities.

Climate and Building Stock: Demand for the provision of space conditioning to
dwelling (heating and cooling) will vary with climate and the nature of the housing
stock. Though it may be possible to match one or more of the Australian climate
zones to those in other countries, it is highly unlikely that it would be possible to
both match the climate zones and the nature of the housing stock to that of another
country which is operating an energy efficiency scheme. This means that demand
for the provision of space conditioning assumed in international schemes will differ
from those relevant to an Australian NESI.

Appliance Use: The demand for the use of appliances and lighting will vary
between Australia and other countries. For example, a number of hours of
television is used or the number of times a clothes washer is operated, will vary
between countries. In theory it should be relatively easy to correct deeming
methodologies for differences in appliance use between countries, but in practice
quite detailed usage information is required to do this. As such information is
generally not available, this limits the value of comparisons between the deeming
methodologies of international schemes to those of an Australian NESI.
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National ESI: Preliminary research and development of deeming methodologies

June 2012
Measurement metrics: A key part of the specification of an energy savings activity
is defining the activity in a standardised and verifiable manner. For example, a highefficiency appliance might be defined in terms of its energy star rating. Due to the
wide variety and variation in measurement metrics used across the world, generally
the measurement metrics used to define the activities of international programs will
differ from the measurement metrics which could be used for Australian NESI
activities. This makes comparison of the energy savings activities, and their deeming
methodologies, difficult between different schemes.
As these key factors relevant to deeming methodologies will differ between a potential
Australian NESI and international schemes, it was concluded that research on the
deeming methodologies of international schemes would not greatly assist in the
development of the details of the deeming methodologies for potential activities in a
possible NESI. However, it was recognised that research on the deeming methodologies
of international schemes could potentially confirm that the overall approach of the
proposed deeming methodologies for a NESI were consistent with international
approaches.
Given these insights into the potential role of the international research, the Project
methodology was revised slightly and the new methodology for the research and
development of the deeming methodologies for a possible NESI consisted of the
following tasks:

review the state scheme activities and deeming methodologies;

develop deeming methodologies for a possible NESI, drawing on the
reviews of the state schemes; and

review international energy efficiency schemes and Australian and
international Minimum Energy Performance Standards (MEPS) to confirm
the additionality of actions in the Australian state-based schemes, and the
consistency of proposed deeming methodologies with international
approaches.
1.2 Contents of Report
The contents of the report reflect the various tasks undertaken to research and develop
the proposed deeming methodologies. The report also addresses a number of issues
which are of relevance to the design of a possible NESI, such as impacts on peak
electricity demand and relevance to low income households. A brief description of the
chapters in the report is as follows:

1. Introduction.

2. Overview of Deeming Methodologies for Activities in state schemes this describes the various activities that have been used by the state
schemes and their approach to deeming calculations.
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National ESI: Preliminary research and development of deeming methodologies



June 2012
Chapters 3 to 13 each deal with a particular type of activity, describing and
comparing the state deeming methodologies of the activity, reviewing
market and BAU scenarios and describing a deeming methodology
appropriate to the activity in a possible NESI.
14. MEPS and Performance Standards in International Energy Saving
Schemes - compares the activity specification of the Australian state
schemes with the Australian MEPS and standards used in international
programs.
15. Peak Demand Savings, Low Income Households Savings and Other
Design Issues - considers the extent and manner in which a possible NESI
might address specific design issues beyond energy saving activities.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
2 Overview of Deeming Methodologies for
Activities in State-Based Energy Saving Schemes
The three state-based energy retailer obligation schemes all contain different residential
energy saving activities for which there are deemed energy savings. The Victorian Energy
Efficiency Target (VEET) scheme contains the most activities, with 28 activities listed.
The NSW Energy Saving Scheme (NSW ESS) contains five activities, however there are a
further five variations on these activities. The South Australian Residential Energy
Efficiency Scheme (REES) contains 14 activities, and a further eight variations of these
activities. These activities are presented in the table below.
NSW was the first to develop a state energy saving scheme, which covered the residential,
industrial and commercial sectors, hence it developed the first set of deeming
methodologies. However the VEET scheme contains a greater number of energy-saving
activities and has undertaken a large body of work on developing the deeming
methodologies for these activities. In particular, Victoria has developed deeming
methodologies for activities involving water heating, space heating and cooling, and space
conditioning which rely on modelling of residential end-use energy requirements.
Estimates of residential space conditioning energy requirements by end-use were
developed using an extensive model, the SV Model.1 South Australia has made use of this
model and the approaches used by Victoria to develop deeming methodologies when
developing their estimates of energy savings for the REES, though they have also
undertaken separate thermal modelling for some of their activities.
A common element of the deeming methodologies involves the final certificates being
defined in terms of greenhouse gas emission abatement, rather than energy savings. This
means that when actions, such as improvements to the building shell which potentially
affect a number of fuels (as space heating may be done with different fuels), or involve
fuel switching, then the deemed savings from the actions are calculated from the
difference in greenhouse emissions before and after the action is undertaken. However,
when an action only affects one fuel or energy source, the energy savings are calculated
and multiplied by an emission factor to convert them to greenhouse emission savings.
The different residential activities in the state schemes were grouped as follows in this
report:

water heating equipment;

space heating and cooling equipment;

space conditioning/thermal properties of buildings;

showerheads;

lighting;
1
Developed by Sustainability Victoria and a consultant, Tony Isaacs.
5
National ESI: Preliminary research and development of deeming methodologies





June 2012
television;
pool pumps;
white goods;
in-home displays; and
standby power controllers.
Table 1: Energy savings activities in state schemes
Category
Num of
Activity
Water
Heating
1
2
VEET
NSW
REES
Electric to gas or boosted solar
hot water
YES
N/A2
YES
Solar retrofit on electric hot
water
Gas to gas boosted solar hot
water
Solar pre-heater on gas water
heater
Ducted gas to HE3 ducted gas
heater
Central electric to HE ducted
gas heater
YES
N/A
YES
YES
N/A
YES
YES
N/A
YES
YES
N/A
N/A
YES
N/A
N/A
7
Ducted heat pump to HE ducted
heat pump
YES
N/A
N/A
8
Central electric to HE ducted
heat pump
YES
N/A
N/A
9
10
11
12
Gas flued space heater
Space heat pump
HE ducted gas in new premises
Air con to ducted evaporative
cooler
Gas ductwork replacement
AC ductwork replacement
Ceiling insulation
Underfloor insulation
Window replacement
Window retrofit
Weather sealing
Draft Proofing
Low efficiency rose to HE rose
YES
YES
YES
YES
N/A
N/A
N/A
N/A
YES
YES
N/A
N/A
YES
N/A
YES
YES
YES
YES
YES
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
YES
YES
N/A
N/A
N/A
N/A
YES
YES
3
4
Space
Heating &
Cooling
Space
Conditioning
Shower Rose
5
6
13
14
15
16
17
18
19
20
21
2
N/A means not applicable.
3
HE means high efficiency
Activity
YES
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National ESI: Preliminary research and development of deeming methodologies
VEET
NSW
REES
YES
YES
YES
YES
YES
YES
24
Low efficiency lighting to HE
lighting
Dispose of pre-1996
fridge/freezer4
HE fridge/freezer
YES
YES
N/A
Television
25
HE television
YES
N/A
N/A
Clothes Dryer
26
HE clothes dryer
YES
N/A
N/A
Pool Pumps
27
HE pool pump
YES
N/A
YES
SPCs
28
YES
N/A
YES
IHDs
29
Standby power controllers
(SPCs)
In-home displays (IHDs)
YES
N/A
N/A
Clothes
Washer
Dishwasher
30
HE clothes washer
N/A
YES
N/A
31
HE dishwasher
N/A
YES
N/A
4
Category
Num of
Activity
Lighting
22
Refrigerator
or Freezer
23
Activity
June 2012
Fridge/freezer must be removed from premises and decommissioned.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
3 Water Heating Activities
3.1 Review of State-Based Energy Savings Schemes Activities
and Deeming Methodologies
3.1.1 State Activities’ Descriptions
Water heating activities involve replacing existing water heaters (or in some cases,
installing new ones) with high efficiency water heaters. Water heating activities are part of
the VEET and REES schemes but are not in the NSW ESS. The way water heating
activities are specified in the VEET and REES schemes vary.
In the VEET, water heating activities are described in terms of the specific water heater
retrofits undertaken or water heater replacements installed. However, in the REES the
activities are described in terms of whether the replacement is occurring earlier than
required, the replacement water heater exceeds efficiency specifications, or the new
installation exceeds efficiency specifications. The REES water heater activities need to be
described in this way because South Australia has specific regulations which require
replacement water heaters to be low emission water heaters, except in specified regional
and remote areas. This means most of the REES activities do not correspond to VEET
activities. The VEET also does not recognise new installations, as Victorian regulations
require the installation of solar water heaters in many situations5, but the REES does
recognise new installations under some circumstances.
The table below shows how the activities in the two schemes compare. For new
installations in the REES, there is a default heater which it is assumed would be installed
unless a more efficient heater is chosen. In gas reticulated areas the default heater is
assumed to be gas and electric otherwise.
5
A solar water heater or rain water tank for toilet flushing are required to be installed for all new Victorian homes.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Table 2: Water heater installations relevant to REES and VEET schemes
Activity
Replacement of Existing HWS
From:
Electric
To:
To:
To:
To:
From:
To:
To:
From:
To:
Natural Gas (5 star)
Electric Boosted Solar
Electric Heat Pump
Gas Boosted Solar
Natural Gas (below 5 star)
Natural Gas (5 star)
Gas Boosted Solar
Natural Gas (5 star)
Gas Boosted Solar
Early Retirement of Operating
HWS
Electric
Natural Gas (5 star)
Electric Boosted Solar
Electric Heat Pump
Gas Boosted Solar
New Installations
From:
To:
To:
To:
To:
Default9:
Electric
To:
To:
Default:
To:
To:
Electric Boosted Solar
Electric Heat Pump
Natural Gas (3 Star)
Natural Gas (5 star)
Gas Boosted Solar
Existing:
To:
Existing:
To:
Retrofit Solar kit
Electric
Electric Boosted Solar
Natural Gas
Gas Boosted Solar
REES
VEET
6
(where permitted )
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
NA
Yes
Yes
(where HWS upgrade required if
existing HWS fails)7
Yes
Yes
Yes
Yes
Yes
(where permitted)8
NA
NA
NA
NA
Yes
Yes
NA
NA
Yes
Yes
NA
NA
NA10
Retrofit solar kit
NA
Retrofit solar kit
Only permitted in SA when replacements of existing water heaters are not required to comply with the water heater
standards or installed HWS exceed the less stringent regional standards.
6
Earlier retirement only relevant in SA when regulations would require the replacement of the existing HWS by a
low emission HWS, when the present HWS fails. Not relevant in VEET.
7
Only permitted in SA when new installations not required to comply with the water heater standards or new
installation exceed the less stringent regional standards. Not relevant in VEET, as majority of new homes install
solar HWS.
8
The default new heater is the heater that it is assumed would be installed under the BAU scenario, and is influenced
by fuel availability and relevant regulations affect new installations.
9
10
Retrofits not permitted in REES.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
3.1.2 Comparison of Deeming Methodologies
Despite the differences between the VEET and REES schemes regarding how the water
heater installations are regarded as activities, the deeming methodologies used in both
schemes are very similar. The main components of the calculations used in the
methodologies for both schemes are as follows:
1. define three different sizes of heaters-small, medium, large;
2. using the average hot water load for the different sized heaters, determine the
average delivered energy, i.e. the energy required by the heater to supply the
average hot water load in the relevant climate regions;
3. research the energy efficiency of the different types of hot water systems, i.e. their
conversion efficiency, pumping and ignition energy use, and storage losses;
4. calculate the average annual energy use of the different types and sizes of water
heaters using the delivered energy and efficiency information;
5. calculate the difference between the energy use of the default11 water heater and
the replacement water heaters, to determine the annual energy savings obtained
through the replacement, i.e. through the action; and
6. calculate the greenhouse emissions12 of the default water heater and the
replacement water heater, and calculate the difference in emissions between them.
Some of the key assumptions used in calculating the energy savings of the actions are
shared by both the VEET and REES, such as:

the annual hot water load which is based on the standard AS/NZS 42342008 Heated water systems - Calculation of energy consumption;

estimations of the efficiency of different types of conventional water
heaters, derived from information on reference water heaters also listed in
the AS/NZS 4234-2008;

estimations of the efficiency of different types of solar and heat pump
water heaters, derived from Sustainability Victoria’s list of heat pumps and
solar hot water systems registered for use in Victoria;
The default heater is the heater that it is assumed would be installed in the home under the BAU scenario relevant
to the replacement activity. Selection of the default heater is influenced by fuel availability and the relevant
regulations affecting new installations or replacements, as appropriate. For a replacement activity, the default heater
will be the same type of heater as the existing heater, if relevant regulations and MEPS permit such a heater to be
reinstalled.
11
Greenhouse emission factors used by the State schemes are for delivered energy, so they include distribution
losses.
12
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National ESI: Preliminary research and development of deeming methodologies



June 2012
estimations of the operating life of replacement and new installation water
heaters;
estimations of the remaining operating life of heaters replaced early; and
the emission factors used for the different fuels.
After the annual energy or emission savings are calculated, the methodologies of the two
schemes differ slightly, as follows.
3.1.2.1 VEET
For the VEET scheme the energy savings from the action are obtained by multiplying the
annual energy savings by the assumed lifetime of the water heater installed. The size of
the installed water heater is also considered in the VEET for calculating the energy saving,
from which the emission savings are derived.
The VEET also uses a regional factor for some activities so installations in nonmetropolitan areas are deemed to produce slightly higher greenhouse emission reductions
than those in metropolitan areas. This factor makes allowance for the higher greenhouse
emission factor of regional areas, which result from the higher electricity distribution
losses in regional Victoria. The regional factor results in up to 8% higher emission savings
being deemed for regional areas when it is applicable to an activity.
To determine the deemed savings from an action therefore involves considering the type
of water heater activity, finding the deemed saving attributed to that activity and
multiplying this by a regional/metropolitan factor.
3.1.2.2 REES
For the REES, the approach to calculating the total energy savings from the actions vary
depending on whether the actions were a replacement, early retirement or new installation
of a water heater. The replacement of water heaters that are not required to comply with
low emission standards, and new installation of high efficiency water heaters, both use the
same approach as the VEET scheme. That is annual energy savings are multiplied by the
average operating life of the heater. However, for the early replacement of water heaters
by low emission heaters, the total energy savings are calculated by multiplying the annual
energy savings by the estimated average time until the heater would need to have been
replaced.
The REES does not consider the size of the water heater in calculating energy and
emission savings. Instead the REES uses information on the energy consumption of
small, medium and large water heaters and on the market penetration of the different
sizes of the heaters, to calculate a stock weighted average energy consumption for each
type of water heater. This information is then used to calculate energy savings and
emission savings.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
3.1.3 Evaluation of Methodologies
A strength of the deeming methodology approach is that it is based on reasonably simple
engineering calculations, published measures of heater efficiencies, and uses a direct
comparison of the energy use of different heater types to determine annual energy
savings. Given that a lot of its main assumptions are derived from existing Australian
standards, and these are publicly available and can be referred to, this further reduces
some of the potential confusion about how the energy savings of these actions are being
calculated.
Consideration of the size of water heaters in the VEET means the deemed abatement
attributed to the water heater replacement/upgrade will be more accurate. However, the
REES, by ignoring the size of the water heater installed, avoids the potentially perverse
result of encouraging the installation of larger water heaters than is required, to gain the
additional certificates.
If a national ESI only recognised activities that were not required under existing
regulations, one challenge to the methodology will be taking into account the variations
in regulations affecting water heaters in different states and territories. The difference
between the actions applicable in Victoria and South Australia have already been shown
by comparing the VEET and REES schemes, where many of the actions of each scheme
were not applicable under the other scheme. If the proposed phase out of electric water
heaters occurs at different rates in the different jurisdictions, then the water heater
activities will need to be defined separately for each jurisdiction, and this will affect the
life of the activities too.
3.2 Review of Market
3.2.1 Water Heater Market
The market for water heaters can be divided into new installations and replacements.
New installations are an important but relatively small part of the water heater market, as
new installations only occur in newly constructed houses. However, existing water
heaters typically need to be replaced every 10 to 15 years. It is during such replacements,
and potentially during new installations, that water heaters can be upgraded to high
efficiency heaters.
Some insight into the type of water heaters, categorised by energy source, that are
currently used in Australia can be gathered from the following table concerning installed
stock.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Table 3: Sources of energy used in water heating (ABS 2011)
Heating energy
Mains electricity
Mains gas
LPG
Solar13
Other14
NSW
Vic
Qld
SA
WA
Tas
NT
ACT
Aust
61.6%
32.4%
1.0%
4.0%
3.0%
21.3%
74.9%
0.3%
2.6%
3.7%
70.2%
12.4%
8.1%
10.1%
2.5%
34.2%
63.4%
0.9%
5.2%
0.8%
22.8%
62.2%
1.2%
16.9%
2.3%
90.0%
54.3%
52.3%
42.3%
1.8%
3.6%
4.6%
45.8%
1.8%
5.5%
44.0%
47.7%
1.8%
6.7%
2.7%
The data suggests there is a large potential to upgrade existing water heaters to high
efficiency solar/heat pump water heaters in all states and territories. The maximum
penetration of solar heaters and heat pumps is 46% in the Northern Territory, while in
most states penetration is less than 10%. There is also considerable potential to upgrade
gas water heaters, which nationally make up 50% of the water heater market, to either
five-star storage systems or instantaneous systems.
Product profiles conducted for the Equipment Energy Efficiency (E3) program (EC
2012a) (EC 2012b) suggest sales of approximately 600,000 water heaters occur annually in
Australia, of which slightly less than half are gas water heaters, an approximately similar
number are electric water heaters, and a small minority are solar and heat pump water
heaters. Of the gas water heaters sold, the majority are instantaneous water heaters. Of
the remaining gas storage heaters, approximately half are conventional 3 star heaters while
the other half are more efficient five-star systems. This sales information suggests there is
still some potential to upgrade gas water heaters to higher efficiency gas heaters, and
considerable potential to encourage greater uptake of solar and heat pump water heaters.
3.2.2 Market and Regulatory Trends
There is an increasing trend towards the installation of gas water heaters, and also an
increasing number of solar and heat pump water heaters are being installed. A number of
factors are contributing to this trend; such as the trend away from electric water heating,
increasing distribution of reticulated gas, the electric water heater phase out and the
introduction of BASIX (Building Sustainability Index regulations) in NSW.
The phase-out of electric water heating is possibly the most significant regulatory trend
which will affect the BAU scenario relevant to water heater upgrade activities. In
December 2010, all states and territories except Tasmania agreed to phase out greenhouse
intensive (electric) hot water systems and the phase-out has already begun for water
heater systems in detached and semi-detached houses in some jurisdictions.
The ABS only define solar HWS as those that use energy from the sun, so it is unclear whether this includes heat
pumps. It has been assumed in this analysis that it also included heat pump water heaters.
13
14
Includes wood, oil and ‘don’t know’ responses to the ABS survey.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
The phase-out arrangements vary between the different states and territories as follows:

New South Wales: There is no current requirement to phase out electric hot water
systems in existing homes in NSW. However, there are standards for hot water
systems for new detached and semi-detached homes under the BASIX -Building
Sustainability Index regulations. These effectively require new homes to install high
efficiency gas, solar or heat pump water heaters.

Victoria: Since 2008 Victoria has required that new detached and semi-detached
houses install either rainwater storage systems or solar water heaters. From May
2011 eligible solar water heaters have been restricted to gas boosted solar water
heaters in gas reticulated areas. The phase-out of conventional electric water heaters
in existing houses is currently being investigated.

Queensland: Since March 2006 it has been necessary to install gas solar or heat
pump water heaters in new detached houses and townhouses. Since January 2010,
for houses and townhouses in gas reticulated areas when water heaters fail and are
replaced , then the householder is required to install a gas, solar, or heat pump water
heater. Houses and townhouses outside gas reticulated areas are still permitted to
install electric water heaters, but are encouraged to install low greenhouse emission
water heaters. Incentives also exist to encourage replacement of electric water
heaters with solar or heat pump water heaters.

South Australia: The South Australian Water Heater Standards were introduced in
2009 and restrict the type of water heaters that can be installed in most detached
and semi-detached new homes, as well as use for replacements in existing homes.
For most detached and semi-detached new homes, alterations or additions in
metropolitan areas, conventional electric water heaters cannot be installed and only
high efficiency gas water heaters, or solar, heat pump or wood fired water heaters
can be installed. Similarly for replacements of failed water heaters in detached and
semi-detached existing homes in metropolitan areas, only high efficiency gas water
heaters, or solar, heat pump or wood fired water heaters can be installed.
Reduced/less stringent requirements apply for new and existing flats and
apartments, and for detached and semi-detached houses in non-metropolitan areas.
Reduced requirements also apply if the water heater is within 3 m of neighbours’
windows or doors.

Western Australia: Since 2007 Western Australia has required that low emission
water heaters are to be installed in new detached and semi-detached housing. As yet
there are no requirements for the replacement of conventional electric water heaters
in existing housing, however regulations that will require the phase-out of electric
water heaters are presently being researched and drafted.
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National ESI: Preliminary research and development of deeming methodologies
June 2012

Tasmania: Tasmania is supplied with electricity produced from low greenhouse
emission sources and has minimal gas reticulation, so it has not introduced
regulations regarding minimum efficiencies for water heaters.

Northern Territory: The 2010 first stage of the phase-out of electric water heaters
does not apply to the Northern Territory as less than 1% of housing is in reticulated
gas areas.

Australian Capital Territory: Since January 2010 conventional electric water heaters
cannot be installed in new detached and semi-detached homes, and high efficiency
gas water heaters, or solar or heat pump water heaters must be installed.
Replacement water heating is not affected in detached and semi-detached homes,
No requirements exist as yet for water heaters in flats and apartments.
In summary, in some, but not all, states and territories the installation of conventional
electric hot water heaters is not permitted for new homes. Only Victoria requires the
installation of solar water heaters in new homes. Regarding the phase-out of conventional
electric heaters, only in South Australia and Queensland has the phase-out begun in some
existing houses, while other states are still planning such regulation.
3.3 BAU Scenarios and Additionality Issues
The BAU scenarios that need to be considered for the replacement of an existing water
heater will be different to those relevant to the installation of water heaters in new houses.
The BAU scenarios for the replacement of existing water heaters will be considered first.
Where appropriate, we propose recommendations concerning the nature of the deeming
methodologies for a possible NESI.
3.3.1 Replacing Existing Heaters
The critical factor determining the BAU scenarios for existing water heaters will be the
relevant regulatory requirements at the state or territory level as they will dictate the
default or minimum efficiency of the water heaters that can be installed. In metropolitan
areas of South Australia the default water heater is assumed to be a high efficiency gas hot
water heater, solar water heater or heat pump water heater. In Queensland where
reticulated gas is available then the default will be a gas hot water heater, solar water
heater or heat pump water heater, due to the state regulations. In all other states and
territories the default water heater will be the existing water heater being replaced.
However this situation will change as the national phase out of conventional electric
heaters comes into effect over the next two years.
The difficulty is that these defaults or minimal requirements vary between the different
states and territories and also will vary over time as the regulations to implement the
phase out of electric water heaters are developed and implemented. Consequently,
EnergyConsult has developed specifications for water heater replacements and upgrades
that include a reference to the minimum regulatory requirements of the state or territory
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National ESI: Preliminary research and development of deeming methodologies
June 2012
where the heater is to be installed. If the water heater used as the default in the deeming
calculations is not permitted under the relevant current state or territory regulations, then
the activity involving the replacement of the existing water heater, or upgrading of a new
installation, is presumed to not be permitted under a possible NESI. In this way the BAU
scenarios accommodate local and changing regulatory environments and ensure that any
energy savings will be additional to what would occur under the BAU situation.
Recommendation: That NESI specification of water heater replacements and upgrades
include a reference that the default (BAU) water heater must be permitted under local regulations
or the activity will not be acceptable as an approved activity in a possible NESI.
As it is invariably less expensive to install the same type of water heater that is being
replaced, it can generally be assumed that a normal replacement water heater for an
existing water heater will be of the same fuel type as the existing heater, provided this is
permitted by local regulations. This is the BAU scenario replacement that has been used
in the VEET and REES. For new installations, the REES assumes that if a high
efficiency gas or solar-gas heater is installed under the REES, then the default heater is
assumed to be gas, and likewise if a heat pump or solar-electric heater is installed then the
default is an electric storage heater.
Recommendation: That in the deeming calculations for the impact of a water heater
replacement in a possible NESI, the default water heater be assumed to be the same fuel type as the
existing heater, and the default for a new installation will be a gas water heater in a gas reticulated
area, and otherwise an electric storage water heater.
Trends towards the improvement in the efficiency of gas heaters have been considered
when defining the efficiency of the default replacement heater in the VEET and REES.
For example, in both the VEET and REES when replacing an existing gas storage heater
the default replacement heater has been assumed to have the efficiency of the average gas
storage heater currently sold, whatever the efficiency of the existing heater may be.
These BAU improvement trends have been considered in the deemed energy savings
calculation of the state schemes by setting the efficiency of the default water heater to
reflect current or forecast energy efficiency levels, and by calculating the energy savings of
the installed water heater in comparison with these efficiency levels.
Recommendation: That in a possible NESI, the efficiency of average water heaters, as
determined by current market data, be used to define the efficiency of the relevant default water
heaters and be used to calculate the deemed savings of the proposed water heater activities.
3.3.2 Early Retirement of Operating Water Heaters
South Australia has an activity in the REES which involves the early retirement of
operating water heaters, up to a specified maximum age, and their replacement by high
efficiency water heaters. The idea is to bring forward the energy savings that will occur
when these water heaters are replaced by more efficient appliances, due to South
Australia's regulations phasing out conventional electric water heaters.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Such an activity could be introduced in a possible NESI but a complicating factor is that
it is not known when the states and territories will be introducing their regulations
phasing out the use of conventional electric water heaters, or what form these may take.
This effectively means that estimating the deemed energy savings from such actions is not
possible except for South Australia.
Recommendation: That the early retirement of an operating water heater not be included as
an activity in a possible NESI.
3.3.3 Retrofitting of Solar Kits to Existing Water Heaters
The VEET scheme has an activity which involves the retrofitting of solar kits to existing
water heaters, effectively using solar energy to preheat water which is then input into the
existing water heaters. Only approved solar kits which are capable of producing a
minimum of 50% solar contribution in zone four15 are allowed to be used in this VEET
activity. The lifetime of the activity is based on the average remaining operating life of
the water heater the solar kit is attached to. The remaining lifetime is calculated at 50% of
a non-solar water heater’s life, i.e. the mean remaining life of an existing water heater.
This activity has not been included in the REES but there does not appear to be any
reason why such an activity could not be used throughout Australia.
Recommendation: That retrofitting of solar kits to existing water heaters be considered as a
potential activity in a possible NESI.
3.3.4 Upgrading Water Heaters for New Housing
Determining the BAU scenarios for the installation of new water heaters will involve
considering what water heater types are permitted by relevant regulations, the availability
of fuels and current market trends.
Currently six of the eight states and territories have minimum requirements for the
installation of water heaters in new detached and semi-detached housing. These exclude
the installation of conventional electric water heaters in most situations. These states and
territories have varying and sometimes complex regulations dictating what type of water
heater can be installed in new houses and under what circumstances. Consequently any
specification of the water heater activities for a possible NESI will need to refer to the
relevant state or territory regulations, in order to define what the default water heater
installation could be. A recommendation has already been made to include references to
local regulations in the specifications of water heater activities.
In some situations, the relevant regulations permit a number of types of water heaters to
be installed in new homes, which means to calculate deemed energy savings an
There are four climate zones defined in Australia in the water heater standard AS/NZS 4234-2008, which relate to
the energy requirements and potential solar gain of water heaters. These are discussed further in section 3.4.2.
15
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National ESI: Preliminary research and development of deeming methodologies
June 2012
assumption must be made about which type of water heater would be installed in
different situations, under a BAU scenario. In other situations, local regulations may
require that either a high-efficiency water heater is installed or some other sustainability
activity be undertaken, such as installing rainwater tanks. This means a decision needs to
be made concerning which of the possible water heaters should be used as the default
heater.
Recommendation: That when relevant regulations permit a number of different types of water
heaters to be installed in a new home, current market data should be used to determine the average
heater and this heater should be used as the default water heater for calculating the energy savings of
the activity in a possible NESI.
Recommendation: That where relevant regulations permit a high-efficiency water heater being
installed or some other sustainability activity be undertaken, then the high- efficiency water heater
will be used as the default water heater for calculating the energy savings of the activity and for
deciding if the activity will be permitted in a possible NESI.
Another market factor defining the default water heater will be the availability of
reticulated gas. As previously mentioned, EnergyConsult recommends that it be assumed
in the specification of the upgrading of water heaters for new housing that, in areas with
gas reticulation, the default water heater will be a gas water heater or a gas boosted solar
water heater, depending on what local regulations dictate as the minimum specifications
for the water heater. In areas without gas reticulation, it will be assumed that the default
water heater will be a conventional electric water heater, electrically boosted solar water
heater or a heat pump water heater, depending again on what local regulations dictate as
the minimum specifications for the water heater.
The energy consumption of the average default water heaters in new installations will also
vary between the states and territories, reflecting market trends regarding the type of
water heaters chosen for new installations. For example, in the Northern Territory the
majority of current water heaters are electrically boosted solar heaters, while in other
regions the penetration of solar heaters is much lower. When local regulations and lack of
reticulated gas would suggest the default water heater for a new installation would be an
electric water heater, and a significant proportion of water heaters are solar-electric or
heat pumps, then the energy consumption of the default heater used in the deeming
methodologies should be the weighted average of the market mix of conventional
electrical heaters and non-conventional electric heaters relevant to the jurisdiction. For
example, if 50% of water heaters are solar-electric and 50% are electric storage, then the
default heater will be assigned an energy consumption which is the average of these two
heater types.
Recommendation: That where a significant proportion of the installed water heaters in a
jurisdiction are non-conventional electric heaters, then the market weighted average energy
consumption of the conventional and non-conventional electric water heaters be used for the default
water heaters in calculating the energy savings of this activity in a possible NESI.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
3.3.5 Allocating Deemed Savings According to Water Heater Size
The differences in the deeming methodology of the VEET and REES showed that it is
possible to calculate the energy saved from specific sizes of water heaters, or alternatively
to ignore the size of the water heater and calculate the energy saving based on an average
sized heater. As previously discussed, the advantage of considering the size of the heater
is that the calculated deemed energy savings will more accurately reflect the savings from
each particular size of heater installed. However, the disadvantage is that the installation
of larger water heaters will result in them being allocated greater certificate numbers,
which will result in greater financial incentives being given to install the larger water
heaters. As there are often relatively small cost differences between sizes of water heaters,
providing a financial incentive to install a larger heater may result in larger heaters being
installed, even if they are not required.
As larger water heaters will use more energy, encouraging their installation is not
considered to be consistent with the overall goal of a NESI, which is to encourage energy
efficiency. Consequently, EnergyConsult considers it is preferable to calculate deemed
savings for water heater installation based on an average size water heater, so as to avoid
encouraging the installation of larger water heaters.
Recommendation: That the deemed savings from installing water heaters be calculated on the
energy consumption of average sized water heaters for a possible NESI.
3.3.6 Additionality Issues
A fundamental requirement of any energy savings action in an energy efficiency scheme is
that the energy savings are additional to that which would have occurred under the BAU
scenario. For the water heater actions, this means the energy savings from the
replacement or upgrading of water heaters needs to be additional to that which would
occur under the BAU scenario.
This additionality requirement has been met in the VEET and REES. In a possible
NESI, this additionality requirement will also be met if the default water heater for each
activity is defined with regard to an appropriate BAU scenario that considers local
regulations, fuel availability and market trends. The recommendations for defining the
default water heaters have been described in the preceding section and, if these definitions
are followed, then the upgrades to the replacement or new water heater should, on
average, lead to additional energy savings compared with what would otherwise occur.
There will always be some situations where an individual will have undertaken the
upgrade regardless of a NESI activity, but provided the calculations of the energy savings
are based on the average behaviour in the BAU scenario and upgrade situation, this will
not significantly impact on the deemed savings calculation accuracy. However, it will be
important to review the market and regulatory situation and the BAU scenario on a
regular basis to ensure that improvements in average efficiency do not undermine the
additionality of savings.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Recommendation: That the market and regulatory situation be reviewed regularly to ensure
that the BAU scenario remains current for this activity so the additionality of energy savings is
maintained in a possible NESI.
3.4 Recommended Activity Specification and Deemed Savings
3.4.1 Description and Specification of Activity
Recommendation: That the following activities, which improve water heater efficiency, be recognised
under a possible NESI:

replacing existing water heaters with high efficiency water heaters (gas, solar and heat
pumps as appropriate);

retrofitting solar kits to existing water heaters; and

new installations of high efficiency water heaters (gas, solar and heat pumps as
appropriate) for new housing.
The activities do not cover installations of high-efficiency gas, solar or electric heat pump water heaters
where these are required under the relevant state or territory regulations. Where such installations are
required by local regulations, it is recommended that no activity or energy savings can be claimed under a
possible NESI.
The activities recommended for inclusion in a possible NESI are recommended on the
basis of being forecast to produce energy savings, except where the activities involve fuel
switching, i.e. changing from electric to gas heaters. When fuel switching occurs, the
activities may result in an increase in the energy consumed by the activity, but the activity
could result in energy cost savings for the householder and a reduction in associated
greenhouse emissions. These fuel switching activities are included as potential deemed
activities in a possible NESI, but their inclusion will be subject to policy decisions
regarding the final design and goals of a NESI.
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National ESI: Preliminary research and development of deeming methodologies
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Table 4: Recommended water heater activities
Activity
Replace Existing
Replace existing: Conventional Electric
Install:
Natural Gas (5 star)
Install:
Electric Boosted Solar
Install:
Electric Heat Pump
Install:
Gas Boosted Solar
Replace existing: Natural Gas(below 5 star)
Install:
Natural Gas (5 star)
Install:
Gas Boosted Solar
Retrofit Solar Kit
Replace existing: Electric
Install:
Electric Boosted Solar
Replace existing: Natural Gas
Install:
Gas Boosted Solar
New Installation
Default:
Electric
Install:
Natural Gas (5 star)
Install:
Electric Boosted Solar
Install:
Electric Heat Pump
Install:
Gas Boosted Solar
Default:
Natural Gas
Install:
Natural Gas (5 star)
Install:
Gas Boosted Solar
Recommendation: That the minimum specifications for water heater replacement, retrofit or new
installation are:
1. The installed/replacement water heater must be one of the relevant types identified in Table 4.
2. The installation/replacement of a high efficiency water heater must not be otherwise required by
the relevant Commonwealth, State or Territory law.
3. The default water heater for new home installations will be defined as the least efficient permitted
under the relevant Commonwealth, State or Territory law, while also assuming the heater to be a
gas/gas boosted water heater if the house is located in a gas reticulated area.
4. The water heater must be installed in accordance with relevant installation standards (both
electrical and gas).
5. Any existing water heater must be removed from the premises and decommissioned.
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National ESI: Preliminary research and development of deeming methodologies
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3.4.2 The Calculations and Deemed Energy Savings
EnergyConsult has determined the deemed energy savings for these activities for four
different climate zones across Australia, rather than for the different states and territories.
This is because the delivered energy requirements for water heaters are defined in terms
of the climate zones in which they are installed, as defined in the relevant standard. This is
not the case for the other activities being considered in this report, as the other activities
do not vary solely with climate zone, and so the deemed savings have been defined for
the different states and territories for the other activities.
The steps and processes in the calculations used by EnergyConsult to determine the
deemed value of energy savings from the water heater activity are as follows:
1. The delivered energy requirement from water heaters, i.e. the energy needed to
heat the water to the required temperature and for the required volume of water,
for households was determined according to AS/NZS 4234:2008 peak load
requirements for climate zones across Australia (see Figure 1), which was then
converted to annual requirements.16 This was undertaken for small, medium and
large households and a weighted average of the results used as the delivered energy
requirement.
2. The energy requirements of each type of water heater to supply the delivered
energy was then modelled, taking into account the efficiency of the systems,
standing losses, solar gains etc. Modelling was based on previous EnergyConsult
work17 and adapted as required.
3. The default water heater for new installations was assigned an energy consumption
based on the weighted average of electric and solar-electric water heaters for the
jurisdiction.
4. The difference between the annual energy consumption of the existing /default
water heater and a high-efficiency heater being installed was calculated to produce
the annual energy savings.
5. Energy savings for each high-efficiency water heater type were then multiplied by
the expected life of the heater replacement/installation, e.g. 12 years for heaters
and 6 years for solar retrofit kits, to determine the lifetime energy savings.
6. When fuel substitutions occurred, the energy use for the two types of heaters were
calculated and listed.
Method developed by George Wilkenfeld and Associates for Sustainability Victoria Estimated Household Water
Heater Energy Use, Running Costs and Emissions, Victoria Based on energy price projections, 2005-2015, May
2005.
16
17
EnergyConsult for Sustainability Victoria, Estimated Hot Water System Running Costs in Victoria, April 2009.
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Figure 1: Climate Zone Map for Water Heaters (AS/NZS 4234-2008)
These calculation steps are similar to those used for the VEET and REES. The deemed
energy savings of the activity, i.e. the lifetime energy savings, for the different
replacement/installation combinations are shown below.
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National ESI: Preliminary research and development of deeming methodologies
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Table 5: Deemed energy savings (GJ) from water heater activities
Activity
Zone 1
Zone 2
Zone 3
Zone 4
Replace Existing
From:
Conventional Electric
To:
Natural Gas (5 star)
To:
-25.61
-29.5
-32.2
-37.9
Electric Boosted Solar
97.1
97.1
94.1
99.3
To:
Electric Heat Pump
96.0
96.0
93.4
93.4
To:
Gas Boosted Solar
82.7
81.7
76.0
81.1
From:
Natural Gas(below 5 star)
To:
Natural Gas (5 star)
29.9
30.8
35.9
38.9
To:
Gas Boosted Solar
138.3
142.0
144.1
157.9
From
Electric
Existing:
To:
Electric Boosted Solar
48.6
48.6
47.0
49.6
From
Natural Gas(below 5 star)
Existing:
To:
Gas Boosted Solar
69.1
71.0
72.1
78.9
Retrofit Solar Kit
New Installation
From Default:
Electric2
To:
Electric Boosted Solar
97.1
97.1
94.1
99.3
To:
Electric Heat Pump
96.0
96.0
93.4
93.4
From:
To:
Natural Gas(below 5
star)
Natural Gas (5 star)
29.9
30.8
35.9
38.9
To:
Gas Boosted Solar
138.3
142.0
144.1
157.9
Note1: The negative savings occur as the conventional electric water heater uses less delivered energy than
the replacement gas heater, though the gas heater is cheaper to operate and produces less greenhouse
emissions. Whether these activities will be included in a possible NESI will be a policy decision dependent
on the final program design and goals.
Note2: Alternative values relevant for Western Australia and Northern Territory. See Table 6.
As previously mentioned, in some jurisdictions the penetration of solar heaters is so high
that the default heater in a new installation, where reticulated gas is not available, can no
longer be assumed to be an electric water heater and the energy use of the average default
heater will differ significantly from a conventional electric water heater. This occurs in
Western Australia and Northern Territory. In these situations the weighted market
average energy consumption of electric and solar heaters was calculated and used as the
energy consumption of the default heater. The resulting energy savings for Western
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National ESI: Preliminary research and development of deeming methodologies
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Australia and Northern Territory from new installations of alternatives to electric water
heaters are presented below.
Table 6: Deemed energy savings (GJ) from new water heater installations in Western Australia
and the Northern Territory
Activity
WA Zone
2
WA Zone
3
WA Zone
4
NT Zone
1
NT Zone
2
From
Default:
Install:
Electric
Electric Boosted Solar
46.6
45.2
47.7
52.4
52.4
Install:
Electric Heat Pump
22.4
44.5
41.8
51.4
51.4
These deemed savings would need to be reviewed if the specifications of the activity are
reviewed, and altered accordingly.
3.4.2.1 Fuel Switching
Two forms of the water heating activities involved a change in the principal fuel used by
the heater, from electricity to gas, and the pre and post annual fuel use is shown below.
The gas and gas boosted solar water heaters continue to use a small amount of electricity
for igniting the gas burners and for pumping.
Table 7: Energy use comparison for fuel switching water heater activities (in GJ)
Activity
Fuel
Zone 1
Zone 2
Zone 3
Zone 4
Replace: Conventional Electric
Electricity
10.0
10.0
11.9
12.9
Install:
Electricity
0.2
0.2
0.2
0.2
Gas
11.9
12.2
14.3
15.8
Electricity
0.3
0.3
0.3
0.3
Gas
2.9
3.0
5.3
5.9
Replace Existing
Install:
Natural Gas (5 star)
Gas Boosted Solar
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National ESI: Preliminary research and development of deeming methodologies
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4 Space Heating and Cooling Activities
4.1 Review of State-Based Energy Savings Schemes Activities
and Deeming Methodologies
4.1.1 State Activities’ Descriptions
The space heating and cooling activities are concerned with installing high efficiency
heating and cooling appliances or with replacing existing appliances with high efficiency
appliances. There are nine space heating and cooling activities in the VEET and two
separate activities defined in the REES. Again, the manner in which the activities are
defined varies between the two schemes.
In the VEET, five of the activities are defined in terms of replacing specific types of
existing heaters or coolers with other specific types of appliances which are more
efficient/lower emission appliances. A further three activities in the VEET involve new
installations of specified high-efficiency appliances and the last activity involves the
replacement of duct work with more efficient duct work.
In the REES there are no replacement activities defined as such and only one appliance
installation activity which involves installing high efficiency cooling appliances or heating
appliances. However, under this activity, a number of different types of appliances can be
replaced by a number of different, specified, high-efficiency appliances. The ductwork
replacement is defined in a similar manner in the VEET scheme.
The table below shows how the activities in the two schemes compare.
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National ESI: Preliminary research and development of deeming methodologies
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Table 8: Space heating and cooling activities relevant to REES and VEET schemes
Activity
Heater
Install
Install
Install
Install
Natural Gas (4 star)
Natural Gas (5 star)
Natural Gas (6 star)
AC (heat pump) with COP18> 3.5
Air Conditioner
Install
Install
Install
Install:
From:
To:
From:
To:
From:
To:
From:
To:
3 Star RC ACNote1 below
4 Star RC AC
5 Star RC AC
6 Star RC AC
Replace Ducted Gas
Ducted Gas (5 star+)
Replace Central Electric
Ducted Gas (5 star+)
Replace Ducted Heat Pump
High efficiency ducted heat pump
Replace Central Electric
High efficiency ducted heat pump
Install
From:
To:
Install High Efficiency Ducted Gas
Ducted Gas (5 star+)
Replace AC with Evaporative AC
Ducted Evaporative AC
To:
To:
Gas/AC Ductwork replacement
Replace Gas Heating Ductwork
Replace RC AC Ductwork
REES
New Install upgraded
heating system (nonducted)
Yes
Yes
Yes
NA
New Install upgraded
heating/cooling system
(non-ducted)
Yes
Yes
Yes
Yes
VEET
Yes
Yes
Yes
Yes
NA
NA
NA
Yes Note 2
NA
Yes
NA
Yes
NA
Yes
NA
Yes
NA
NA
NA
Yes
Yes
Yes
Yes
Note 1: ‘RC AC’ are reverse cycle air conditioners
Note 2: For heating only and in non-gas reticulated areas
4.1.2 Comparison of Deeming Methodologies
The deeming methodologies used in the VEET and REES schemes appear to be
generally very similar for this set of activities, despite there being some differences in the
18
COP refers to coefficient of operating performance, a measure of the energy efficiency of the appliance.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
activities used in the two schemes. The underlying approach to the deeming
methodologies for the two schemes is as follows:
1. Determine the average heating loads and cooling loads of small, medium and large
houses.
2. Calculate the annual energy used by each default19 heater or cooler type, of
different specified sizes, by dividing the heating and cooling loads by the
conversion efficiency of the average heater or cooler.
3. Calculate the annual energy used by the high efficiency heater or cooler type to be
installed, for the different specified sizes, by dividing the heating and cooling loads
by the conversion efficiency of the relevant heater or cooler.
4. Calculate the difference between the annual energy use of the existing/default
heater or cooler and the replacement heater or cooler to determine the energy
saving.
5. Using appropriate greenhouse emission factors, the energy use of the
existing/default heater or cooler and the replacement heater or cooler is converted
to the estimated emissions produced and the savings in emissions also calculated.
The two schemes differ in their determination of the heating loads and cooling loads and
also in their definitions of small, medium, and large heating and cooling appliances.
4.1.2.1 VEET
In the VEET calculations, the heating loads and cooling loads are derived directly using
thermal modelling of a range of houses in three climate regions in Victoria using the
Sustainability Victoria/Tony Isaac model and appropriate stock modelling. This results in
different deemed energy savings for the three different climate zones in Victoria.
A discount factor of 5% to allow for houses being vacant part of the time is also included
in the VEET calculations.
In addition, the VEET uses different greenhouse emission factors for electricity for the
metropolitan and regional parts of Victoria. This reflects the difference in transmission
and distribution losses in different parts of the state.
4.1.2.2 REES
In comparison, the REES calculations of the heating loads and cooling loads are derived
from research conducted on the average efficiency and capacity of standard heaters and
The default heater/cooler is the appliance type that would be installed in a new home under the BAU scenario,
and the efficiency of this appliance is assumed to be the sales weighted average efficiency of the relevant appliance.
19
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National ESI: Preliminary research and development of deeming methodologies
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air conditioners, and the conversion efficiency of these appliances. By multiplying the
output capacity of the appliance by the average hours it operates, and by the efficiency of
the device, an estimate of the heating or cooling load was obtained. Only state-wide
heating and cooling loads are used. As hours of operating were used to derive these loads,
which will include consideration of vacancy rates, a discount for the vacancy rates were
not required in the REES calculations.
It might appear that the basis for determining heating and cooling loads is quite different
but, as operating hours were ultimately derived from thermal modelling research
combined with information on appliance stock, appliance sizes and efficiencies, there are
some common research elements in both approaches.
Some of the main assumptions underlying the deeming methodologies, and the basis for
these assumptions, are as follows:

the heating and cooling loads of an average house, which have been
derived from different sources, as explained above;

the estimates of the efficiency of the different types of heating and cooling
appliances being replaced, which are based on research conducted for
relevant regulatory impact statements and product profiles undertaken
under the government Equipment Energy Efficiency (E3) program;

the efficiency of different types of heating and cooling appliances being
installed, which are based on standardised testing results to determine
Energy Star ratings or similar measures of efficiency;

the heating and cooling load will vary with the size of the appliance, which
is based on the assumption that appropriately sized heaters and coolers will
be installed in different sized homes; and

the energy savings from installation of a more efficient appliance will not
be lost through the ‘rebound effect’, i.e. result in an increase in the
householders’ comfort through a warmer/cooler house rather than
resulting in energy savings.
4.1.3 Evaluation of Methodologies
A strength of both variations of the deeming methodology approaches is that, once the
heating and cooling loads have been determined, the calculation of the energy savings
from the different actions is straightforward. The estimates of the efficiency of replaced
appliances are also based on documented research and the efficiency of appliances being
installed is specified with reference to established standards.
A strength of the deeming methodology of the VEET scheme is that its method of
determining the heating and cooling load of houses is transparent and has the advantage
that it recognises the difference in heating and cooling loads which occur in different
climatic regions. This could be particularly useful in a national scheme where differences
between the climatic variations of regions may be important.
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National ESI: Preliminary research and development of deeming methodologies
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Another challenge in extending the deeming methodology nationally will be to include the
full range of heating and cooling equipment that is used. For example, enclosed wood
heaters are very popular in some states or regions and a possible NESI action could be to
encourage the installation of high efficient wood heaters. Such heaters have lower wood
consumption and so will lower energy costs and air pollution from the burning of wood.
However, the selection of such actions will be dependent on the design and goals of a
possible NESI.
4.2 Review of Market
4.2.1 Heating and Cooling Appliance Market Summary
The penetration of the main forms of space heating and cooling, and ducted heating and
cooling in the Australian market is shown in the table below.
Table 9 - Australian penetration of heating and cooling in households (percentage)
Proportion of
Households with
Appliances
NSW
Vic.
Qld
SA
WA
Tas.
NT
ACT
Aust.
Non-Evaporative
(refrigerative) AC
Ducted Gas
Heating
Non-Ducted Gas
Heating
Wood
57.4
52.7
68.5
70.0
46.9
42.7
80.7
46.4
59.2
2.8
36.9
0.3
3.4
3.6
0.0
0.0
38.8
11.5
24.3
31.2
4.5
29.2
40.7
2.4
49.7
17.7
25.6
5.0
3.5
4.0
7.5
4.7
20.0
9.8
3.8
4.7
Note: Air conditioning data and wood from ABS 2011, except NT and ACT wood from ABS 2008.
Gas heating from E3 gas heating profiles.
The data indicates almost 60% of Australian households use non-evaporative airconditioning and a quarter of Australian households have some form of gas heating.
This information however does not give a useful indication of the potential to improve
the efficiency of space heating or cooling. Of greater relevance to this are the following:

MEPS for air conditioning have been introduced and raised four times
over the last decade, so the current high-efficiency air conditioners
available are much more efficient than those that were being purchased 10
years or more ago; and

there is a wide range of efficiency in gas ducted and non-ducted heaters,
with their energy star rating ranging from 2 stars to 5 stars, meaning
considerable energy can be saved by replacing an older inefficient heater
with a current highly efficient model.
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National ESI: Preliminary research and development of deeming methodologies
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4.2.2 Market and Regulatory Trends
The penetration of air conditioners is steadily increasing and has more than doubled over
the last ten years. The majority of Australian households, 52% in 2008, now have nonevaporative air conditioners (EC 2010). The MEPS levels for air conditioners have
regularly been increased over the last ten years, with the last increase in October 2011, but
no further increase in MEPS is envisaged until 2014. The recent increase in MEPS will
have reduced the variation in the efficiency of the air conditioners, but there will still be
some models which are more efficient than others of a similar size.
For ducted gas heating the market is steadily increasing and the number of households
with ducted gas heating has grown by 44% in the ten years to 2008 (EC Jan. 2011).
Approximately 50% of current ducted gas heaters are 2 or 3 star heaters, and
approximately 50% are either 4 or 5 star units. Ducted gas heaters in Australia are
required to be tested and given energy star rating labels, to meet various safety
requirements and to meet a MEPS. A product profile (EC Jan. 2011) has been prepared
which investigated raising MEPS for these heaters.
The gas space heater market is steady, or possibly increasing slightly, in Australia. A
product profile (EC 2012) has been prepared which investigated raising MEPS.
4.3 BAU Scenarios and Additionality Issues
The BAU scenario for both the replacement of existing heaters and air-conditioners, and
the upgrading of new heaters and air-conditioners, for the VEET and REES are based on
the same premise, that the BAU efficiency of the heater or air-conditioner will be the
current market average for the relevant type of heater or air-conditioner.
There is no information suggesting that regulatory changes will be introduced in the short
term which will impact on this BAU scenario. The MEPS for air-conditioners are not
forecast to increase until at least 2014. Though on average the efficiency of airconditioners tends to rise each year, the recent introduction of more stringent MEPS is
likely to reduce the BAU efficiency improvement over the short term. Consequently it can
be assumed that the current market average efficiency for air-conditioners will remain
largely unchanged over the next few years.
The introduction of more stringent MEPS for gas ducted and space heaters is currently
only at the discussion stage, so it is unlikely that any MEPS will be introduced in the short
term or that they will affect the efficiency of these products in the short term.
There also appears to be little or no BAU improvement in the efficiency of gas heaters
due to technology changes overall during the last few years, though there may have been
improvements in some types of heaters. (EC Jan 2011, EC 2012). Again this suggests that
it is reasonable to assume the current market average efficiency for gas ducted and space
heaters will remain approximately the same over the next few years.
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National ESI: Preliminary research and development of deeming methodologies
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Recommendation: That the current market average efficiency for gas ducted, space heaters and
air conditioners can be assumed to remain unchanged over the next two to three years when
calculating deemed savings, but that this assumption will need to be reviewed before a possible
NESI is introduced and any changes be reflected in the activity specifications and deemed energy
savings calculations.
4.3.1 Additionality Issues
Both the VEET and REES require that the efficiency of the replacement or upgraded
appliance must exceed a specified level of average efficiency for the appliance installation
to be an eligible activity under their schemes. As the current market average efficiency for
any product group will always be the same or greater than the relevant MEPS, if a MEPS
exists, this means the VEET and REES both require replacement or upgraded appliances
to exceed any relevant MEPS.
The definition of the specifications for the activities in the VEET and REES is the
method used to ensure that the minimum efficiency of the replacement or upgraded
appliance clearly exceeds the current market average efficiency. This ensures that any
energy savings from the activity will be additional to those that would have occurred
under the BAU scenario. It is recommended this approach to defining the BAU scenario
and the specifications of activities needs to be followed in a possible NESI.
Recommendation: That any NESI specification of heaters, air conditioning and ductwork
replacements be defined to ensure that the minimum efficiency of the replacement or upgraded
appliance clearly exceeds the current market average efficiency.
For the replacement of gas space heaters it is necessary to assume that the existing heater
was a flued heater. Un-flued gas heaters are permitted and popular in some states, but as
these heaters are rated as having very high efficiency, there is little or no additional energy
savings obtained by replacing these. Consequently, the replacement of non-ducted gas
heaters activity is only relevant where an existing, flued gas space heater is present.
Recommendation: That a NESI specification of a non-ducted heater replacement activity be
defined as the replacement of an existing, flued non-ducted gas heater and the replacement of nonflued heaters be excluded from the activity.
4.4 Recommended Activity Specifications and Deemed Savings
4.4.1 Description and Specification of Activity
Recommendation: That the following activities, to improve the efficiency of space heaters and cooling
appliances, be recognised under a possible NESI:

replace existing air conditioners, space heaters, or ducted heaters with high efficiency
coolers/heaters;

upgrade non-ducted air conditioners or space heaters in new homes to high efficiency
coolers/heaters; and
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National ESI: Preliminary research and development of deeming methodologies

June 2012
retrofit efficient ducting for ducted heating systems.
One activity, the changing from electric central heating to gas ducted heating, involves
fuel switching and results in an increase in the energy consumed by the activity.
However, the activity could result in energy cost savings for the householder and a
reduction in associated greenhouse emissions. This fuel switching activity is included as
potential deemed activity in a possible NESI, but its inclusion will be subject to policy
decisions regarding the final design and goals of a NESI.
EnergyConsult does not recommend that the installation of upgraded ducted air
conditioners or ducted heaters for new homes be included as a proposed activity, as the
installation of ducted systems is currently not the norm for the average Australian home
and would result in additional energy consumption. This recommendation follows from
our understanding that the intention of a possible NESI is not to encourage the
installation of more energy intensive appliances.
Recommendation: That the installation of upgraded ducted air conditioners or ducted heaters
for new homes not be included as a NESI activity.
Table 10: Recommended space heating/cooling activities
Activity
Replace/Install upgraded Heating system (non-ducted)
From Existing/ Default:
To:
To:
To:
From Existing/ Default:
To:
Natural Gas (average 3.3 star) - flued
Natural Gas (4 star) - flued
Natural Gas (5 star) - flued
Natural Gas (6 star) - flued
AC (heat pump)- average efficiency (3.5 COP)
AC (heat pump) with COP >4.5
Replace/Install upgraded Cooling system (non-ducted)
From Existing/ Default:
Install
Install
Install
Install:
2.2 Star RC AC
3 Star RC AC
4 Star RC AC
5 Star RC AC
6 Star RC AC
Replace Existing Heater
From:
To:
From:
To:
From:
Replace Ducted Gas Heater
Ducted Gas ( default 3.5 star)
Ducted Gas (5 star+)
Replace Central Electric Heater
Ducted Gas (5 star+)
Replace Ducted Heat Pump
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National ESI: Preliminary research and development of deeming methodologies
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Activity
To:
From:
To:
High efficiency ducted heat pump with COP >3.5
Replace Central Electric Heater
High efficiency ducted heat pump with COP >3.5
Replace Refrigerative AC with Evaporative AC
From:
To:
Refrigerative AC
Ducted Evaporative AC
Gas/AC Ductwork replacement
From:
To:
To:
ExistingGas Heating/RC AC Ductwork
High efficiency Gas Heating Ductwork- min R1.5
High efficiency RC AC Ductwork- min R1.5
Based on these proposed activities, preliminary specifications of the activity have been
developed with the intention of being sufficiently accurate to enable a calculation of the
deemed energy saving that will occur. Further work may be required on the specifications
to take into account the implementation arrangements of a possible NESI, and they may
need to be amended with reference to any relevant updated standards or state regulations.
Recommendation: That the recommended minimum requirements for the activities are as specified
below:
1. The installed/replacement heater or cooling system must be of the relevant types identified in
Table 10.
2. An efficient system is one of the following:

a gas room heater which is rated as 4 star or higher when assessed and labelled against
AS/NZS 4553:200820; and which is flued; or

a reverse cycle air conditioner (room) which is rated as 3 star or higher for both heating
and cooling when assessed and labelled against AS/NZS 3823.2:200921; or

an evaporative air conditioner which is ducted and rated with an EER22>14.0.
3. The heating/cooling appliance must be installed in accordance with relevant installation standards
(plumbing, electrical and gas).
4. Any existing heater/air conditioner being replaced must be removed from the premises and
decommissioned. This includes removal and disposal of any refrigerants and other scheduled
20
AS/NZS 4553:2008 - Gas Space Heating Appliances.
AS/NZS 3823.2:2009 - Performance of Electrical Appliances – Air conditioners and Heat Pumps - Energy Labelling and
Minimum Energy Performance Standard (MEPS) Requirements.
21
EER refers to the energy efficiency ratio, the ratio of the cooling energy output of the appliance to its energy
input.
22
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National ESI: Preliminary research and development of deeming methodologies
June 2012
substances (where applicable) in accordance with the Australian and New Zealand refrigerant
handling code of practice as established under the Ozone Protection and Synthetic Greenhouse
Gas Management Act 1989.
Exception:- where it is not practicable to remove all or part of the system, then it must be
decommissioned, with any refrigerants and other scheduled substances disposed of in accordance
with the above code of practice. The householder must authorise the system (or part of the system)
remaining in place.
5. The size of the heating/cooling appliance is defined in the following table.
Table 11: Recommended specifications of heater/cooler appliance size
Appliance type
Small
Medium
Large
Room Heater
2.0-3.0 kW
3.1-6.0 kW
>6.0 kW
Room Air Conditioner
< 4.0kW
4.0-10.0 kW
> 10.0 kW
Ducted Heating
< 8.0 kW
8.0-14.0 kW
> 18.0 kW
Ducted Air Conditioner
< 8.0 kW
8.0-14.0 kW
> 18.0 kW
4.4.2 The Calculations and Deemed Energy Savings
The steps and processes in the calculations used to determine the deemed value of the
activity are as follows:
1. The delivered energy requirement for heating or cooling for Victoria, i.e. the
heating or cooling load as modelled using Accurate modelling and considering the
housing stock mix of Victoria, was derived from previous research conducted by
Sustainability Victoria for the VEET scheme. This was undertaken for small,
medium and large households.
2. The heating and cooling loads were then scaled for each state and territory, to take
into account the differences in climate, housing types and housing sizes in the
different jurisdictions. Scaling factors were obtained from a study undertaken as
part of investigating a mandatory residential disclosure assessment for Australia
(EES 2010).
3. The actual energy requirements of each heater/cooler to supply the delivered
energy was then modelled, taking into account the efficiency of the systems.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Appliance efficiencies were based on previous EnergyConsult work 23 and adapted
as required.
4. Annual energy savings were determined by comparing the difference in the annual
actual energy use for the existing/default appliance and the replacement appliance.
5. The total savings were determined by multiplying annual savings by the lifetime of
the appliance. The lifetime of the appliances were assumed to be 12 years for nonducted heating, non-ducted air conditioners, and evaporative air conditioners, 15
years for ducted heaters and 10 years for duct work.
6. When fuel substitutions occurred, the energy use for the two types of appliances
are listed.
The deemed energy savings of the activity and annual energy running costs for the
different replacement/installation combinations are shown below.
EnergyConsult for E3 program- Decision RIS: Minimum Energy Performance Standards for Air Conditioners: 2011, Dec
2010; Product Profile: Gas Ducted Heaters, Jan 2012; Product Profile: Gas Space Gas Space & Decorative (Fuel Effect)
Heaters, May 2012.
23
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Table 12: Deemed energy saving (MJ) from replacement or upgrading of gas or heat pump room heater
Jurisdiction
Small Heater (2-3.0 kW)
High
eff RAC
NSW
Vic
Qld
SA
WA
Tas
NT
ACT1
2,832
5,058
1,113
3,136
1,922
7,688
253
7,688
4 star
gas
3,173
5,666
1,247
3,513
2,153
8,612
283
8,612
5 star
gas
7,372
13,165
2,896
8,162
5,003
20,011
658
20,011
Medium Heater (3.1-6.0 kW)
6 star
gas
11,018
19,675
4,329
12,199
7,477
29,906
984
29,906
High
eff RAC
5,374
9,596
2,111
5,950
3,647
14,587
480
14,587
4 star
gas
6,020
10,750
2,365
6,665
4,085
16,341
538
16,341
5 star
gas
13,988
24,979
5,495
15,487
9,492
37,968
1,249
37,968
6 star
gas
20,905
37,331
8,213
23,145
14,186
56,743
1,867
56,743
Large Heater (>6.0 kW)
High
eff RAC
6,705
11,973
2,634
7,423
4,550
18,199
599
18,199
4 star
gas
7,511
13,413
2,951
8,316
5,097
20,388
671
20,388
5 star
gas
17,452
31,165
6,856
19,322
11,843
47,371
1,558
47,371
6 star
gas
26,083
46,576
10,247
28,877
17,699
70,796
2,329
70,796
Note1: The Tasmania and ACT energy savings are the same as they are modelled as having the same heating energy requirements, hence the savings are calculated
to be the same.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Table 13: Deemed energy saving (MJ) from replacement or upgrading of room air conditioner
Jurisdiction
Small AC <4.0 kW)
3 star
AC
NSW
Vic
Qld
SA
WA
Tas
NT1
ACT
1,804
651
4,539
2,195
2,293
247
15,657
690
4 star
AC
5,382
1,943
13,542
6,548
6,839
738
46,708
2,059
5 star
AC
8,206
2,963
20,649
9,984
10,428
1,126
71,221
3,140
Medium AC (4.0-10.0 kW)
6 star
AC
10,493
3,788
26,403
12,766
13,334
1,439
91,066
4,015
3 star
AC
3,007
1,085
7,566
3,658
3,821
412
26,095
1,151
4 star
AC
5 star
AC
6 star
AC
8,970
3,238
22,570
10,913
11,398
1,231
77,846
3,432
13,677
4,938
34,416
16,640
17,381
1,876
118,702
5,234
17,488
6,313
44,005
21,276
22,223
2,399
151,776
6,692
Large AC (>10.0 kW)
3 star
AC
4,510
1,628
11,349
5,487
5,731
619
39,142
1,726
4 star
AC
13,455
4,857
33,855
16,369
17,098
1,846
116,769
5,149
5 star
AC
20,516
7,407
51,624
24,960
26,071
2,814
178,053
7,851
6 star AC
26,233
9,470
66,008
31,915
33,335
3,599
227,664
10,038
Note 1: It is recognised that the Northern Territory savings are much larger than other jurisdictions, but this is consistent with the scaling factors developed for the
mandatory residential disclosure scheme, by Energy Efficiency Strategies (EES 2010), as previously mentioned.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Table 14: Deemed energy saving (GJ) from replacement or upgrading of ducted heating
Jurisdiction
Small Heater <8.0 kW)
Gas to 5
star gas
NSW
Vic
Qld
SA
WA
Tas
NT
ACT
73.8
131.7
29.0
81.7
50.1
200.2
6.6
200.2
Ht Pump
to 3 star
Ht Pump
6.6
11.7
2.6
7.3
4.5
17.8
0.6
17.8
Ht Pump
to 4 star
Ht Pump
17.9
31.9
7.0
19.8
12.1
48.5
1.6
48.5
Central
Elec to 5
star Gas1
-40.0
-71.5
-15.7
-44.3
-27.2
-108.7
-3.6
-108.7
Medium Heater (8.0-14.0 kW)
Central
Elec to 3
star Ht
Pump
264.3
471.9
103.8
292.6
179.3
717.3
23.6
717.3
Central
Elec to 4
star Ht
Pump
275.6
492.1
108.3
305.1
187.0
748.0
24.6
748.0
Gas to 5
star gas
93.3
166.6
36.7
103.3
63.3
253.3
8.3
253.3
Ht Pump
to 3 star
Ht Pump
8.3
14.8
3.3
9.2
5.6
22.6
0.7
22.6
Ht Pump
to 4 star
Ht Pump
22.6
40.4
8.9
25.0
15.3
61.4
2.0
61.4
Central
Elec to 5
star Gas1
-50.7
-90.4
-19.9
-56.1
-34.4
-137.5
-4.5
-137.5
Central
Elec to 3
star Ht
Pump
334.3
597.0
131.3
370.1
226.8
907.4
29.8
907.4
Central
Elec to 4
star Ht
Pump
348.6
622.5
136.9
385.9
236.5
946.2
31.1
946.2
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National ESI: Preliminary research and development of deeming methodologies
Jurisdiction (Table 14 continued)
Gas to 5
star gas
NSW
Vic
Qld
SA
WA
Tas
NT
ACT2
116.4
207.9
45.7
128.9
79.0
316.0
10.4
316.0
Ht Pump
to 3 star
Ht Pump
10.4
18.5
4.1
11.5
7.0
28.1
0.9
28.1
June 2012
Large Heater (>14.0 kW)
Ht Pump
to 4 star
Ht Pump
28.2
50.4
11.1
31.2
19.1
76.6
2.5
76.6
Central
Elec to 5
star Gas1
-63.2
-112.8
-24.8
-70.0
-42.9
-171.5
-5.6
-171.5
Central
Elec to 3
star Ht
Pump
417.1
744.8
163.9
461.8
283.0
1,132.1
37.2
1,132.1
Central
Elec to 4
star Ht
Pump
434.9
776.7
170.9
481.5
295.1
1,180.5
38.8
1,180.5
Note 1: Increased energy consumption (negative savings) occurred when changing from electric to gas, but the activity may result in energy cost savings and
greenhouse emission savings. It will be a policy decision if these activities are included in a possible NESI.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
Table 15: Life time energy saving (MJ) from replacement of refrigerative air conditioner with
ducted evaporative air conditioner
Jurisdiction
NSW
Vic
Qld
SA
WA
Tas
NT
ACT
Small AC (<8.0
kW)
38,365
13,850
96,535
46,675
48,752
5,263
332,956
14,681
Medium AC
(8.0-14.0 kW)
Large AC
(>14.0 kW)
63,941
23,083
160,892
77,791
81,254
8,772
554,927
24,468
95,912
34,625
241,338
116,687
121,881
13,158
832,390
36,703
Table 16: Life time energy saving (MJ) from duct work replacement for ducted gas heater
Jurisdiction
NSW
Vic
Qld
SA
WA
Tas
NT
ACT1
Small gas
heater (<8.0
kW)
5,221
9,324
2,051
5,781
3,543
14,172
466
14,172
Medium gas
heater (8.014.0 kW)
6,631
11,841
2,605
7,341
4,500
17,998
592
17,998
Large gas
heater (>14.0
kW)
8,118
14,497
3,189
8,988
5,509
22,035
725
22,035
Note 1: The Tasmania and ACT energy savings are the same as they are modelled as having the same
heating energy requirements, hence the savings are calculated to be the same.
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National ESI: Preliminary research and development of deeming methodologies
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5 Space Conditioning Activities
5.1 Review of State-Based Energy Savings Schemes Activities
and Deeming Methodologies
5.1.1 State Activities’ Descriptions
Space conditioning activities are concerned with improving the thermal properties of a
building shell so that less heating or cooling is required to maintain the dwelling at a
comfortable temperature. Generally such activities involve improving the insulation of
the building, reducing the air flow/draughts and reducing heat losses and gains from
windows.
There are five different space conditioning activities under the VEET scheme, and two
activities listed under the REES. Two activities - the installation of ceiling insulation and
draught proofing - are common between both schemes.
The table below shows how the activities in the two schemes compare.
Table 17: Space conditioning activities relevant to REES and VEET schemes
Activity
REES
VEET
Yes
Yes
NA
NA
NA
Yes
NA
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Ceiling insulation
Install: R3 .5 insulation where none was previously
installed
Underfloor insulation
Install: R2 .5 insulation where none was previously
installed
Window replacement
Install: Thermally efficient glazing
Window retrofit
Install: Installed product to raise thermal efficiency
Install:
Install:
Install:
Install:
Install:
Weather sealing/Draught proofing
Door sealing
Window sealing
Exhaust fans seal
Ventilation openings seal
Chimney or flue seal
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National ESI: Preliminary research and development of deeming methodologies
June 2012
5.1.2 Comparison of Deeming Methodologies
The deeming methodology used in both the VEET and REES schemes is fundamentally
the same, and involves the following steps for each activity:
1. Using thermal modelling, determine the average heating and cooling loads in an
average house with and without each space conditioning activity being conducted.
2. Calculate the difference in the average heating and cooling loads with/without
each activity conducted to determine the average annual energy savings.
3. Divide the heating and cooling saving loads by the conversion efficiency of the
relevant types of heaters or air-conditioners to determine the average annual
energy saving per house for each type of appliance.
4. Calculate the average heating and cooling energy savings across the mix of heating
and cooling appliances in the market by weighting the energy saving for each type
of appliance by the market penetration of that type of appliance.
5. Calculate the average annual heating and cooling greenhouse emission savings
across the mix of heating and cooling appliances by multiplying the average annual
energy saving per house for each type of appliance by the relevant fuel/energy
emission factors, then weighting the results by the penetration of that type of
appliance.
6. Calculate total deemed savings by multiplying annual savings by the expected life
of the activity.
One of the main assumptions underlying the deeming methodologies is that the impact of
the space cooling actions on the heating and cooling loads of an average house can be
predicted using thermal modelling of a range of representative house designs.
The methodologies of the two schemes differ slightly, as follows.
5.1.2.1 VEET
The VEET calculation uses a weighted average to determine the energy savings across
appliance types, with the weighting for each appliance determined by the market
penetration of the relevant appliances.
The VEET scheme is based on thermal modelling that has been done for three climate
zones within the state24.
The climate zones used for buildings are specified in the National Construction Code and are different from those
mentioned in section 3.4.2, page 17, that are used for water heating.
24
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National ESI: Preliminary research and development of deeming methodologies
June 2012
A discount factor to allow for rebound and vacancies, i.e. the house being vacant for part
of the time, is also included in the VEET calculations.
5.1.2.2 REES
The REES uses a simple average to determine the energy savings across appliance types,
rather than a weighted average.
Only one climate zone has been assumed for the REES and all calculations and modelling
is done for this zone.
The REES does not discount the energy savings attributed to efficiency actions, so there
is no separate allowance for rebound and vacancies.
5.1.3 Evaluation of Methodologies
The key strengths of the deeming methodologies are that they rely on sophisticated
thermal modelling of housing stock which will be impacted by the energy savings actions
to determine the impact of the actions, and that the calculations are straightforward once
the modelling of energy savings has been undertaken. In addition, the approach can be
readily adopted for different climate regions or states and territories in Australia. Yet, one
limitation of thermal modelling is that many assumptions must be made to undertake the
modelling and the validity of these assumptions cannot always be verified. However,
despite this limitation, the deeming methodology used in the state schemes is probably
the most effective method for estimating energy and emissions savings from space
conditioning actions.
One issue for a NESI will be that thermal modelling of representative housing in all states
and territories is desirable in order to use this deeming methodology for a NESI.
5.2 Review of Market
5.2.1 Market Summary
Space conditioning activities are concerned with improving the thermal properties of a
building shell. The penetration of these space conditioning activities in the Australian
market is as follows:

69% of homes had insulation in 2011(ABS 2011), and previous research
has shown that 98% of these had roof insulation (ABS 2010), suggesting
there is a potential market for installing ceiling insulation;

as only 1% of houses with insulation had floor insulation, this suggests
there is potential for this activity, though the action is only relevant to
suspended timber floors;
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National ESI: Preliminary research and development of deeming methodologies


June 2012
the penetration of double glazed windows is low, 2.6% (ABS 2008),
suggesting there is a potential market for the installation of double glazed
windows; and
the present extent of ceiling and draught proofing relevant to the activities
is not known, but is also expected to be significant.
This information suggests that there is a large potential market for space conditioning
activities at the national level.
5.2.2 Market and Regulatory Trends
There is little evidence to suggest that any significant trends exist which would increase
the penetration of space conditioning actions.
The proportion of homes with insulation in Australia has grown from 61.5% to 69%
between 2008 and 2011, but as 11% of homes install insulation due to rebates offered, the
majority of this increase will be due to the rebates (ABS, 2011). The Federal Government
rebate for home insulation has been withdrawn, so the trend towards insulation is more
likely to revert to the pre-rebate trend. In the five years to 2008 there was an increase in
the proportion of homes insulated by only 1%, and almost all of this increase can be
attributed to the requirement of new homes to be insulated (ABS, 2008). Consequently, it
can be concluded that the trend is for minimal retrofitting of installation in Australian
homes, unless government programs or rebates provide incentives to do so. At present
no government rebates for insulation are offered.
Information on the take-up of other non-insulation space conditioning actions is not
available, but given the low penetration of double glazed windows and the cost of
undertaking this action, it is probable that there is little market trend towards the
installation of double glazed windows in existing homes. There may be some BAU trend
towards undertaking draught proofing activities, but the extent of this trend is also
assumed to be minimal.
The trends for new homes will be different, with an increasing proportion of homes
having additional insulation and double glazing installed, as a result of more stringent
building code requirements and increased awareness of energy efficiency. The space
conditioning activities of the state-based schemes are aimed at existing homes, so these
changes in new homes do not affect such activities.
However, a new group of space conditioning activities could be developed for a possible
NESI that were aimed at encouraging new homes to exceed the building code
requirements or average efficiency of new homes. This option was not explored in the
present report, as relevant data and thermal modelling was not available to research this
option, but it may be an option worth exploring in the future.
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National ESI: Preliminary research and development of deeming methodologies
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5.3 BAU Scenarios and Additionality Issues
The BAU scenario for the space conditioning activities in both the VEET and REES is
based on the same premise, that only a small amount of installation of space conditioning
improvements would occur without the intervention of the VEET and REES. The
market trends discussed above also suggest that for the BAU scenario minimal installation
of space conditioning improvements would occur without the intervention of
government programs for initiatives.
There is no information suggesting that regulatory changes will be introduced in the short
term which will impact on this BAU scenario. Any regulations that require the
installation of insulation in existing homes when they are undertaking major renovations
will only impact on a small minority of homes, and so can largely be disregarded in terms
of the impact on the BAU scenario.
Recommendation: That the BAU scenario for space conditioning activities in a possible
NESI assumes that only minimal installation of space conditioning improvements will be
undertaken unless supported by government programs, such as state ESI or grants programs.
5.3.1 Additionality Issues
In the VEET and REES it is assumed that only a small amount of installation of space
conditioning improvements will occur unless undertaken as part of these schemes.
Consequently the energy savings from undertaking the space conditioning improvement
is largely additional to that which would occur if the action had not been undertaken, but
the savings are slightly discounted to reflect the minimal BAU installations. Nationally, it
is recognised that a small number of households may install some of the space
conditioning improvements on their own initiative, so it is recommended that the energy
savings from the relevant space conditioning actions be discounted to allow for this.
Recommendation: That the energy savings from space conditioning actions be discounted where
it is expected there may be some installation of the relevant space conditioning improvement under
the BAU scenario.
The level of discounting will vary, from no discounting for expensive activities that are
rarely undertaken, such as retrofitting double glazing, to 10% discount for ceiling
insulation which is occasionally undertaken by householders for additional comfort or
when renovating.
MEPS and other regulations do not appear to affect the type of technologies and
materials used in space conditioning actions so they are not relevant to determining the
additionality of the energy savings from these actions.
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National ESI: Preliminary research and development of deeming methodologies
June 2012
5.4 Recommended Activity Specifications and Deemed Savings
5.4.1 Description and Specification of Activity
Recommendation: That the following space conditioning activities be recognised under a possible
NESI:





installing insulation in un-insulated ceilings;
installing insulation in un-insulated floors;
retrofitting windows to increase thermal properties;
installing thermally efficient glazing; and
undertaking weather sealing or draught proofing.
Specifications of the space conditioning activities have been developed with the intention
of the specifications being sufficiently accurate to enable a calculation of the deemed
energy saving to occur. The specifications may need to be reviewed to take into account
future agreed parameters of a possible NESI and implementation requirements. Similarly
they would need to be amended when relevant standards or state regulations are updated.
The specifications for the activities are specified below.
Ceiling Insulation:

insulation product must be installed in a ceiling area (or part of a ceiling
area) which is above a living or habitable space, and which has not been
previously insulated. This excludes topping up existing insulation, which is
addressed as a separate activity below (section 5.4.1.2);

installation of insulation must not be otherwise required by law;

insulation product must achieve a minimum R-value of 3.5 when measured
in accordance with AS/NZS 4859.1:200225; and

insulation product must be installed in accordance with AS 3999:1992.26
Underfloor insulation:

insulation product must be installed under a floor area (or part of a floor
area) which is in a living or habitable space, and which has not been
previously insulated. This excludes topping up existing insulation (that is,
installing insulation on top of existing insulation);

installation of insulation must not be otherwise required by law;
25AS/NZS
Provisions.
26
4859.1:2002 – Materials for the Thermal Insulation of Buildings – General Criteria and Technical
AS 3999:1992 – Thermal Insulation of Dwellings – Bulk Insulation – Installation Requirements.
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National ESI: Preliminary research and development of deeming methodologies


June 2012
insulation product, or two or more products when installed together27,
must achieve a minimum R-value of 2.5 when measured in accordance
with AS/NZS 4859.1:200228; and
insulation product must be installed in accordance with AS 3999:1992.29
Window Replacement:

existing windows must be removed and replaced with more efficient
windows;

replacement thermally efficient windows must be installed in the external
walls of a living or habitable space; and

windows/ product installed must comply with the performance
requirements of AS 2047—1999 and AS 1288—2006, have a total Uvalue30 of not more than 4, and be Window Energy Rating Scheme
(WERS) rated and labelled to a minimum of 4 stars for heating.
Window Retrofit31:

Retrofitted products must be fitted to windows in the external walls of a
living or habitable space;

installing product on one or more single glazed windows for a minimum
glazing area of 5m2; and

product must, when installed on a single glazed window, result in a still air
gap being created between the single glazed window and the product and
raise the thermal efficiency performance of the window.
Weather sealing/Draught proofing:
Installation of a product, specified below, that reduces the air flow in and out of living or
habitable space, while ensuring the premises receive a natural air change at a rate of at
least 0·5 changes per hour or failing to comply with the minimum ventilation
requirements of Part 3.8.5 of the 2008 edition of the Building Code. Eligible products are:

door bottom sealing product or a product that is a light weight selfadhesive weather stripping product made of foam, flexible plastic,
27
For example, a foil insulation and insulation batt might have a combined insulation of greater than R2.5
28AS/NZS
Provisions.
4859.1:2002 – Materials for the Thermal Insulation of Buildings – General Criteria and Technical
29
AS 3999:1992 – Thermal Insulation of Dwellings – Bulk Insulation – Installation Requirements.
30
The U value is a measure of the rate of non-solar heat loss or gain through the window.
31
A window retrofit differs from a window replacement as a retrofit involves a modification to the existing window.
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National ESI: Preliminary research and development of deeming methodologies





June 2012
polypropylene pile, rubber compressible strip, fibrous seal or a similar
product;
window sealing product that is a light weight self-adhesive weather
stripping product made of foam, flexible plastic, polypropylene pile, rubber
compressible strip, fibrous seal or a similar product;
ceiling or wall exhaust fan sealing product such as a self-closing damper,
flap, filter (for instance, of a type commonly fitted to a kitchen range hood)
or other sealing product that can be closed to seal the exhaust of a fan;
product capable of restricting the airflow into and out of a ventilation
opening.
ventilation opening sealing product that is a light weight self-adhesive
weather stripping product made of foam, flexible plastic, polypropylene
pile, rubber compressible strip, fibrous seal or a similar product; and
product that is capable of restricting air flow into or out of a chimney or
flue.
5.4.1.1 Additional Activity: Wall Insulation
The option of installing wall insulation has been explored for both the VEET and REES
schemes but factors such as the lack of adequate insulation standards and methods to
verify adequate installation, plus concerns regarding cost effectiveness lead to it not being
included. Other concerns have been that using ‘blow in’ insulation may result in a loss of
effectiveness as the insulation settled, and that installing insulation batts in walls would be
difficult, expensive and potentially have OH&S risks.
However, the installation of wall insulation has been successfully used in Victoria public
housing retrofits and is an eligible activity for rebates under the ACT energy efficiency
rebate scheme. Also, if this activity was included in a NESI the cost of undertaking the
activity may reduce as industry develops greater skills in this area, increasing its cost
effectiveness. Consequently this activity may be worth considering further for inclusion
in a possible NESI.
Only limited thermal modelling of the impacts of this activity were available from
research undertaken in Victoria, so saving results are indicative only.
Given these limitations, a proposed specification is:

install of a minimum of R1.5 insulation in the external walls of a fully
conditioned dwelling (i.e. with ducted heating or cooling) or of the external
and internal walls of the conditioned part of a house with partial
conditioning (i.e. with room or space heating or cooling); and

energy saving based on wall area insulated.
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National ESI: Preliminary research and development of deeming methodologies
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5.4.1.2 Additional Activity: Top-up Ceiling Insulation
The option of topping up ceiling insulation has been explored for both the VEET and
REES schemes but has not been regarded as cost effective in either case. The principal
concern is that the costs of topping up insulation exceeded the anticipated energy cost
savings from installing the insulation. Also the resulting minimum level of insulation is
assumed to be lower, R2.5, as the presence of existing insulation will make it harder to
install a higher level of insulation consistently across all ceiling spaces.
However, there may be methods developed which would lower these costs and if this
activity was included in a NESI the cost of undertaking the activity may reduce as
industry develops greater skills in this area, increasing its cost effectiveness. Consequently
this activity may be worth considering further for inclusion in a possible NESI.
Only limited thermal modelling of the impacts of this activity were available from
research undertaken in Victoria, so saving results are indicative only.
Given these limitations, a proposed specification is:

installation of insulation to raise the minimum level to R2.5 in the ceiling
of a fully conditioned dwelling (i.e. with ducted heating or cooling) or in
the ceiling area covering the conditioned part of a house with partial
conditioning (i.e. with room or space heating or cooling); and

energy saving based on ceiling area insulated.
5.4.1.3 Additional Activity: External Awnings
The option of installing external awnings has been explored and rejected for the REES.
The principal difficulty with this activity is that the cost of installing awnings is relatively
high but the energy savings are reasonably low. This has resulted in the activity not being
considered cost-effective for inclusion in the REES, and it does not appear to have been
considered for the VEET or NSW ESS. However, these cost barriers may be reduced if
the activity was included in a national program such as a NESI.
Only limited thermal modelling of the impacts of this activity were available from
research undertaken in Victoria, so saving results are indicative only.
Given these limitations, a proposed specification is:

installation of an external awning proving full shading to north and west
facing windows, and south facing windows in the tropics32;
This will need to be further refined by identifying the relevant areas where different directions of windows
produce different levels of solar gain.
32
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
June 2012
awnings to be adjustable, allowing them to be raised when colder
temperatures mean solar gains from windows are required to raise the
internal temperatures; and
energy saving based on window areas that are shaded.
5.4.2 The Calculations and Deemed Energy Savings
The calculation of the estimates of the deemed energy savings for a possible NESI is
based on thermal modelling undertaken for Victoria for the VEET scheme, with the
savings scaled33 for the other jurisdictions. The thermal modelling undertaken for South
Australia was not used as scaling factors to convert these results for the other jurisdictions
were not available.
The steps and processes in the calculations used to determine the estimates of the deemed
value of the activities are as follows:
1. Determine using thermal modelling the average base heating and cooling loads in
an average Victorian house, with and without each space conditioning activity
being conducted.
2. Calculate the difference in the average base heating and cooling loads to determine
the average base annual energy savings from each space conditioning activity.
3. Using appropriate scaling factors, which consider the impact of differences in
climate and housing stock between jurisdictions, convert the energy savings
calculated for the activity occurring in Victoria into an estimate of the base annual
energy savings in each of the other jurisdictions.
4. Research and determine the market penetration of each of the main heating and
cooling technologies in each jurisdiction.
5. Calculate a weighted conversion efficiency value for each of the heating and
cooling technologies, by dividing their market penetration by the conversion
efficiency of the relevant types of heaters or air-conditioners.
6. Multiply the average base annual energy savings for each space conditioning
activity by the weighted conversion efficiency values for the relevant heating or
cooling technologies, and sum the resulting annual energy savings to determine the
estimates of annual energy savings for each activity.
7. Multiply the estimated annual energy savings for each activity by the life of the
activities to determine the deemed energy savings.
Scaling factors were obtained from a study undertaken as part of investigating a mandatory residential disclosure
assessment for Australia (EES 2010).
33
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National ESI: Preliminary research and development of deeming methodologies
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An important aspect of the calculations of deemed savings is the assumed lifetime of the
different activities. In the case of space conditioning activities there is little direct
information on the lifetime of these activities and therefore the lifetimes need to be
indirectly estimated. For example, if the average Australian house lasts 50 years then,
when a space conditioning activity is undertaken, on average the remaining life of the
house will be 25 years. This means that the maximum life of any space conditioning
action can be 25 years and, as few retrofits will be undertaken in relatively new homes, the
maximum average life is probably closer to 20 years.
Using such research and analysis, and considering the lifetimes used in the VEET and
REES, the lifetimes of the space conditioning actions for a NESI were developed as
shown in the following table.
Table 18: Lifetimes of space conditioning activities in Australian schemes
Activity
NESI
VEET
REES
ceiling and wall insulation
20
25
20
under-floor insulation
20
25
NA
window replacement
20
25
NA
window retrofit
10
15
NA
5 for film
draught proofing
10
10
10
awnings
10
NA
NA
The deemed energy savings resulting from the methodology described above should be
regarded as preliminary estimates only, as the calculation methodology used only
Victorian or South Australian thermal modelling results that was scaled for the other
jurisdictions. The difficulty with scaling such modelling results is the scaling factors reflect
differences in the heating and cooling loads of different jurisdictions, due to climate and
housing stock variations, but the space conditioning activities do not have the same
impacts in different climates. For example, installing floor insulation in colder climates
will produce energy savings by reducing heating loads, but the same action in warmer
climates could increase energy consumption by increasing cooling loads.
The EES (2010) review of the methodology being used for modelling the impact of the
national mandatory disclosure scheme indicated that in some cases the impact of space
conditioning action calculated using scaling could be incorrect by a factor of two.
The way to improve the accuracy of the deemed energy savings figures is to undertake
thermal modelling of the impact of all of the space conditioning actions in the different
jurisdictions. The Department of Energy Efficiency and Climate Change has already
commissioned thermal modelling of the impact of the space conditioning actions for all
jurisdictions, but at the time of preparing the current report the output of this modelling
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was not in a suitable form for preparing the deeming calculations. Consequently, the use
of scaling and the Victorian thermal modelling information have been used to develop the
deemed energy savings estimates presented below.
The estimates of the deemed energy savings of the activity and annual energy running
costs for the different replacement/installation combinations are shown below.
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Table 19: Estimated deemed energy saving (MJ) from space conditioning activities
Jurisdiction
NSW
Vic
Qld
SA
WA
Tas
NT
ACT
Ceiling
Insulation
(per m2)
Underfloor
Insulation
(per m2)
Window
Replacement
(per m2)
Window
Retrofit
(per m2)
Door
sealing (per
door)
Window
sealing (per
m2)
Exhaust
Sealing
(per fan)
Vents
Sealing
(per vent)
Chimney
Sealing
(per
chimney)
873
2,789
512
1,182
789
2,612
1,416
4,024
357
1,113
218
484
324
1,057
613
1,601
1,662
4,764
822
2,247
1,502
5,583
2,162
6,537
748
2,144
370
1,011
676
2,512
973
2,942
1,728
5,393
493
2,330
1,525
6,362
792
7,409
123
390
32
166
109
460
42
536
4,156
13,380
847
5,599
3,633
15,820
550
18,393
1,061
3,379
246
1,430
930
3,993
258
4,645
23,513
75,205
5,195
31,683
20,596
88,881
4,724
103,372
Note: If the greenhouse emission savings from undertaking these space conditioning activities are to be given a deemed value, it will be necessary to revise the
calculations of energy savings so these can reflect the energy savings by fuel type for each activity and in each jurisdiction.
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National ESI: Preliminary research and development of deeming methodologies
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Table 20: Estimated deemed energy saving (MJ) from additional space conditioning activities
Jurisdiction
NSW
Vic
Qld
SA
WA
Tas
NT
ACT
Wall Insulation
(per m2)
Top-up Ceiling
Insulation (per m2)
External Awnings
(per m2)
321
1,172
142
432
283
1,010
340
1,720
54
171
31
73
48
160
87
247
4
1
12
6
5
0
44
1
An example of how the information in this table can be used to calculate the energy savings from a particular action, e.g. the installation of
ceiling insulation in South Australia, is as follows:

determine the size of the ceiling area that was insulated, e.g. 100 m2

look up the relevant energy savings for that activity in that state from Table 19, i.e. 1182 MJ per m2

Multiple the area insulated by the energy savings per m2, i.e. 100*1182 =118,200 MJ.
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National ESI: Preliminary research and development of deeming methodologies
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6 Installing Low Flow Showerhead Activity
6.1 Review of State-Based Energy Savings Schemes Activities and
Deeming Methodologies
6.1.1 State Activities’ Descriptions
The activity involves the installation of efficient, low flow showerheads to replace existing
inefficient showerheads. The emission savings comes from obtaining reduced hot water use that
occurs from their installation.
The activities as they are defined in the VEET and REES are fundamentally the same, however in
the REES it is possible to install an extra-efficient (six litres per minute) showerhead and this is
deemed to have a greater emission savings. Otherwise, both schemes specify that an efficient
showerhead rated as having a 3 star water efficiency and with a flow rate less than nine litres per
minute be installed and the existing showerhead be removed.
In the NSW ESS, the low flow showerhead activity was introduced under the GGAS scheme but
more recently it has been removed due to concerns that many showerheads had not been installed
and the market had reached saturation.
6.1.2 Comparison of Deeming Methodologies
The deeming methodology approaches used for both the VEET and REES schemes are the same,
with a few variations concerning the assumptions made in the calculations.
The deeming methodology for low flow showerheads consists of the following:
1. Specify the underlying assumptions including:

number of occupants per dwelling;

average number of showers per person per day;

number of shower days;

flow rate Inefficient (l/min);

flow rate Efficient (l/min);

shower time with inefficient showerhead;

shower time with efficient showerhead; and

number showerheads per dwelling.
2. Calculate the water used per inefficient showerhead and per efficient showerhead, based on
the assumptions above.
3. Calculate the water saving per annum, and for the operating life of the showerhead, from
the difference between the annual water consumed by an efficient and inefficient
showerhead.
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National ESI: Preliminary research and development of deeming methodologies
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4. Calculate the difference in temperature between cold water and shower temperature,
between hot water and cold water, and the ratio to determine the proportion of hot water
used by the shower.
5. Use the proportion of hot water used in the shower, and the water saving due to the
efficient showerhead, to calculate the amount of hot water saved.
6. Calculate the energy saved through not heating that amount of hot water, by multiplying
the amount of hot water saved by the temperature difference between hot and cold water
by 0.00418634 to determine the base energy savings (i.e. the saving in delivered energy
required to heat the water).
7. Divide the base energy savings by the conversion efficiency for each hot water technology
and multiply this by the penetration of each hot water technology, and then sum the results
for all technologies to determine the weighted actual annual energy savings.
8. Multiply the annual energy savings by the life of the showerhead activity, assumed to be 10
years for the VEET and four years for the REES, to calculate deemed savings.
There are also some minor differences regarding how the impact of business as usual and MEPS
efficiency improvements in appliances are included in the calculations. The VEET uses a discount
factor to account for these while the REES more carefully calculates the remaining operating life
of the action.
6.1.3 Evaluation of Methodologies
The two methodologies are fundamentally the same. The strength of the methodologies lie in their
being based on simple calculations of the energy requirement to heat the water saved. Further
research concerning shower usage and the actual flow rates of showers in real life, and whether, or
for how long, low flow showerheads remain installed after being fitted, could strengthen the
methodology.
An updated calculation of the lifetime of the showerheads may be required for a possible NESI, as
regulations, state schemes and water efficiency programs will continue to reduce the BAU life of
existing inefficient showerheads.
6.2 Review of Market
6.2.1 Market Summary
In 2007, 54% of households had low flow showerheads in all showers, an increase of about 10%
since 2001. Given that since 2007 there have been several years of drought in most parts of
Australia, and many programs which have been promoting the retrofitting of low flow
34
MJ required to raise one litre of water by 1°C
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National ESI: Preliminary research and development of deeming methodologies
June 2012
showerheads, it can be anticipated that the penetration of low flow showerheads is much higher in
2012. In addition, in many states it is now a requirement that low flow showerheads be installed
when significant renovations are undertaken to the home or hot water systems are replaced. This
suggests the penetration of low flow showerheads is now around 70% to 80% in Australia. In
addition, under the GGAS almost as many low flow showerheads have been distributed as there
are showerheads in NSW, so this market can be assumed to be saturated. The Victorian market is
also probably approaching saturation, as the number of shower rose activities being conducted in
the VEET is rapidly declining.35
These findings suggest that there is a decreasing, though possibly still significant, market for
retrofitting low flow showerheads, but the time before these showerheads are replaced under the
BAU scenario is quickly decreasing in many jurisdictions. As an activity in a possible NESI, the
installation of low flow showerheads has probably become an early replacement exercise, with the
life of energy savings from the activity now related to the period before the showerheads would be
replaced, rather than the actual operating lifetime of the showerhead.
6.3 BAU Scenarios and Additionality Issues
The BAU scenarios for the installation of low flow showerheads differ between the state-based
schemes.
In the REES, the BAU scenario is that low flow showerheads will on average be installed within
four years, by 2016, due to regulatory requirements and the existence of other programs which are
encouraging the uptake of low flow showerheads. Consequently this activity is seen as an early
replacement of inefficient showerheads and the life of the activity reflects this.
In the VEET, the assumption is that there will be some substitution of showerheads without the
VEET activity and hence, though the life of the showerhead activity is assumed to be the
operating life of a showerhead, the savings are discounted by 20% to reflect the BAU installation
activity.
In the NSW ESS, the BAU scenario is effectively that all showerheads are now low flow
showerheads.
For a possible NESI, an appropriate BAU scenario would assume a reasonably high take-up of
low flow showerheads, independent of a NESI. Local regulations in many jurisdictions, greater
community consciousness regarding saving water, and the availability of low flow showerheads
will all strongly encourage the replacement of less efficient showerheads in the short to medium
term. Consequently, as a NESI activity the installation of low flow showerheads is seen as an
early replacement of inefficient showerheads.
There is insufficient information available on the penetration of low flow showerheads at the
current time, and of the trend towards low flow showerheads, to be able to accurately predict an
35
Based on EnergyConsult analysis of prescribed activity trends using data from VEET performance reports.
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National ESI: Preliminary research and development of deeming methodologies
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average BAU replacement time for existing inefficient showerheads. However, it is reasonable to
assume that this activity will not be appropriate for NSW, given that the NSW market was
saturated with low flow showerheads due to the GGAS, and it may also not be appropriate for
Victoria as its market is probably also approaching saturation.
In the remaining jurisdiction, the BAU average time before replacement in South Australia is four
years, but the time for replacement in the other jurisdictions is not known. However, the other
jurisdictions have less stringent showerhead replacement policies, so the average time for
replacement is probably greater than four years. Based on this information, EnergyConsult
estimates that the national BAU average replacement for these jurisdictions is around five years.
This implies the life of the showerhead activity in a NESI is estimated to be five years, but this
should be reviewed before a NESI is implemented. It may also be desirable to use different
lifetimes for the different jurisdictions.
6.3.1 Additionality Issues
Assuming that the installation of low flow showerheads is seen as an early replacement of
inefficient showerheads, then the energy savings from this action are due to the more efficient
showerhead being installed earlier than would otherwise occur. The energy savings are therefore
additional to that which would occur under the BAU scenario.
It is important that showerhead replacements be regarded as eligible activities only if the low flow
showerheads are actually installed in a household. Such installations reduce the risk of the
showerhead not being installed or being removed, undermining the estimates of the energy
savings.
6.4 Recommended Activity Specification and Deemed Savings
6.5 Description and Specification of Activity
The activity involves the installation of a low flow showerhead and the removal of an existing
higher flow showerhead. The specifications for the activity consist of:

the activity is not to be undertaken in jurisdictions considered by the relevant
regulators to have a market penetration of low flow showerheads approaching
100%




an inefficient showerhead, in its current use, has a flow rate greater than nine litres
per minute;
an efficient showerhead is a product which is rated as having a 3 star water
efficiency when assessed and labelled against AS/NZS 6400:2005, and with a flow
rate less than nine litres per minute;
the replacement of an inefficient showerhead must involve installing the efficient
showerhead in place of the inefficient showerhead;
the installation of an efficient showerhead must not be otherwise required by law;
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National ESI: Preliminary research and development of deeming methodologies
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June 2012
an efficient showerhead which is installed must be tested to ensure it is correctly
installed, does not leak, and is operating correctly at a typical showering
temperature; and
an inefficient showerhead which is replaced must be removed from the premises.
6.5.1 The Calculations and Deemed Energy Savings
The deeming methodology for low flow showerheads consists of the following, which are the
same steps undertaken in the VEET and REES (outlined in 6.1.2) with the exception of step 8.
1. Specify the underlying assumptions, including:

number of occupants per dwelling;

average number of showers per person per day;

number of shower days;

flow rate inefficient (l/min);

flow rate efficient (l/min);

shower length inefficient’

shower length efficient; and

number showerheads per dwelling.
2. Calculate the water used per inefficient showerhead and per efficient showerhead, based on
the assumptions above.
3. Calculate the water saving per annum, and for the operating life of the showerhead, from
the difference between the annual water consumed by an efficient and inefficient
showerhead.
4. Calculate the difference in temperature between cold water and shower temperature,
between hot water and cold water, and the ratio to determine the proportion of hot water
used by the shower.
5. Calculate the amount of hot water saved using the portion of hot water used and the water
saving due to the efficient showerhead.
6. Calculate the energy saved through not heating that amount of hot water, by multiplying
the amount of hot water saved by the temperature difference between hot and cold water
by 0.00418636 to determine the base energy savings.
7. For each separate jurisdiction, divide the market penetration rates37 of each hot water
technology by the conversion efficiency for each hot water technology38, to create a
conversion factor for that jurisdiction and technology.
36
MJ required to raise one litre of water by 1°C
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8. Multiply the base energy savings of each jurisdiction by the relevant conversion factor for
each jurisdiction and technology, and then sum the results for all technologies in each
jurisdiction to determine the weighted actual energy savings for each jurisdiction.
The results of these calculations are presented in the table below.
Table 21: Deemed energy saving (MJ) per low flow showerhead installed
Jurisdiction
NSW
Vic.
Qld
SA
WA
Tas.
NT
ACT
Energy
Saving (MJ)
N.A.
4,8291
3,314
4,3552
3,462
4,982
1,508
4,816
Note 1: This activity is not applicable in NSW and probably not applicable in Victoria where the market penetration of low
flow showerheads is approaching 100%.
Note 2: The SA energy savings are based on a five year life for the activity, but in the REES a four year life is used, so the
savings will be reduced if different lifetimes for the activity are assigned for the different jurisdictions under a NESI.
As previously discussed, these energy savings should be reviewed to reflect any changes to the
BAU replacement rate of showerheads in the different jurisdictions and to reflect any future
changes to relevant regulations or programs in each of the jurisdictions which would affect the
BAU replacement rate of showerheads.
To determine the deemed energy savings from any particular set of showerhead installations,
multiply the number of installations by the savings for that jurisdiction. For example for 5
installations in Western Australia: 5 * 3462 = 17,310 MJ.
37
Market penetration rates obtained from ABS 2011.
Conversion efficiencies based on Estimated Hot Water System Running Costs in Victoria, Prepared for Sustainability
Victoria, by EnergyConsult August 2010.
38
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National ESI: Preliminary research and development of deeming methodologies
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7 Lighting Activities
7.1 Review of State-Based Energy Savings Schemes Activities and
Deeming Methodologies
7.1.1 State Activities’ Descriptions
All three state schemes currently include residential lighting activities, aimed at installation of
lighting technologies that either meet or exceed MEPS efficiency requirements, or bring forward
installation of MEPS-compliant lighting technologies. The NSW scheme no longer includes the
replacement of 240V general purpose lamps in the residential sector, due to the phasing out of
inefficient 240V incandescent lamps as well as significant activity in this category stimulated by the
NSW scheme over recent years. The VEET and REES schemes continue to include this activity,
although these schemes are newer than the NSW scheme and thus have not encountered the same
level of activity in this area.
All three schemes incorporate activities aimed at replacing or improving existing 50W halogen
downlights. These activities may include replacement of the lamp only, the lamp and the
transformer, or the entire downlight unit (see Table 22 below for further detail).
All schemes require the replacement unit to emit a minimum quantity of light (measured in
lumens, abbreviated as lm) as well as placing limits on parameters such as lamp lifetime and lamp
colour attributes (correlated colour temperature, abbreviated as CCT). For more detailed
descriptions of activities refer to Table 22 below.
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National ESI: Preliminary research and development of deeming methodologies
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Table 22: State lighting activities
Activity
Replace 240V
omnidirectional lamp
Replace 240V directional
lamp
Replace 12V lamp
Specification for
Replacement
Measure
Light output
equivalency,
AS4847.2, min
efficacy, ≥8000hr
lamp lifetime, CCT,
dimmable if fitted
Transformer
compatible,
≥350lm, AS4847.2,
min efficacy,
≥8000hr lamp
lifetime, CCT, beam
angle, dimmable if
fitted
NSW
REES
VEET
Incumbent
Item
Energy
Savings
Variables
Key
Specification for
Assumptions
Used in Energy Replacement Measure
Savings Calc
≥18W/25W
halogen /
incandescent
CFL, AS4847.2,
≥10,000hr lamp lifetime,
flux equivalency, CCT,
dimmable if fitted
Incandescent
≥35W
halogen
Efficacy,
lamp
lifetime
Replace 12V lamp +
magnetic transformer
Not included in this
scheme
Replace 12V downlight
≥350lm, AS4847.2,
min efficacy,
≥35W
≥8000hr lamp
lifetime, CCT, beam halogen
angle, dimmable if
fitted
-
Typical bundle
of lamp
wattages,
savings
lifetime = lamp
lifetime,
impact of
MEPS on BaU
Incumbent Item
Energy
Savings
Variables
Specification
Key
for
Assumptions
Used in Energy Replacement
Measure
Savings Calc
halogen /
incandescent
light output
omnidirectional /
directional
50W halogen
lamp
lamp
lifetime,
wattage
≥500lm, AS4847.2 (CFL),
LCA certified (LED),
halogen, ≥10,000hr lamp
lamp
50W halogen
lifetime, min lumen
lamp + magnetic lifetime,
maintenance, CCT, beam
wattage
angle, dimmable if fitted transformer
50W halogen
lamp +
transformer
lamp
lifetime,
wattage
Not included in
this scheme
Savings
lifetime = lamp
lifetime,
impact of
MEPS on BaU
12V 35W
halogen lamp,
≥500lm, ≥80%
lumen
maintenance
≥500lm, ≥80%
lumen
maintenance,
≥10,000hr
lamp lifetime
Incumbent
Item
Energy
Savings
Variables
Key
Assumptions
Used in
Energy
Savings Calc
-
-
-
50W
halogen
lamp
Lamp
lifetime
50W
halogen
Lamp
lamp +
lifetime
magnetic
transformer
Specifics not
available
50W
Lamp
halogen
lifetime,
lamp +
wattage
transformer
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National ESI: Preliminary research and development of deeming methodologies
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7.1.2 Comparison of Deeming Methodologies
All three state schemes take the following general approach to deeming the quantity of energy
savings from residential lighting activities:
Energy savings = difference in lighting power x lamp lifetime.
where lamp lifetime = rated lamp lifetime (note that this is the median lamp lifetime rather
than the mean lifetime)
In the REES and NSW schemes, multiple energy savings results are available, depending on the
installed lamp power. The VEET scheme employs a bundled approach, with no energy savings
variation resulting from differing lamp wattages – i.e. VEET employs a single value based on a
weighted market average basket of typical lamp wattages. The VEET scheme however does vary
energy savings results based on lamp efficacy (light output divided by power), which the other
schemes do implicitly by giving different energy savings results depending on installed lamp
power. VEET discounts savings to allow for BAU uptake of CFLs. All schemes vary energy
savings based on rated lamp lifetime.
The VEET and REES schemes take into account the impact of MEPS (inefficient incandescent
lamp phase-out) on the energy savings value for 240V general purpose lamps (which were the first
lamps to be impacted by MEPS). This is achieved by incorporating the effect of MEPS (higher
market penetration of efficient lamps) into the baseline scenario for 240V general purpose lamps.
7.1.3 Evaluation of Methodologies
All three methodologies for calculating energy savings are straightforward and are considered
robust, in that they estimate energy savings based on the lighting power saving (activity versus
baseline) multiplied by the lamp (median) lifetime. However it might be prudent to consider the
following items, with respect to simplifying methodologies and taking into account recent market
developments:

streamline and simplify treatment of lamp efficacy, wattage and light output;

investigate differences between rated median lamp life (the life quoted by
manufacturers) and actual mean lamp life (the actual energy savings life of a lamp);

update baseline assumptions to take into account recent MEPS developments, such
as the elimination of 12V 50W halogen lamp sales from the market in favour of
35W;

revise assumptions to take into account any data released since May 2012 on
residential lighting technology take up; and

improve specifications as they relate to LED lighting.
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Review of Market
7.1.4 Lighting Market
Efficient lamps are generally compact fluorescent lamps (CFLs) and (high quality) light emitting
diodes (LEDs) as opposed to tungsten-incandescent and halogen lamps which are considerably
less efficient. The approximate efficacies of lamp types is summarised below:

Tungsten-incandescent: 10 lumens/Watt.

Halogen: 15 lumens/Watt.

CFL/LED: 50+ lumens/Watt.
Analysis of lamp import data from 2000-2011 from the Australian Bureau of Statistics (ABS)
shows that sales of CFLs and LEDs comprise the following approximate percentages for each
category:
 240V omnidirectional lamp sales:
~50% are CFL/LED
 240V directional lamp sales:
~10% are CFL/LED
 12V directional lamp sales:
~3% are CFL/LED
Note that LED sales are very small amongst the above sales. A recent (currently unpublished)
household survey undertaken by DCCEE shows that these above sales percentages have also
approximately translated into installed stock percentages in Australian households.
7.1.5 Market and Regulatory Trends
The following trends are evident in the Australian lighting market:

Analysis of ABS data from 2000-2011 shows that retail sales of CFLs in 2012 have tripled
since 2006. The level of CFL sales has recently stabilised and is now considered to be
approaching market saturation in terms of technical compatibility (e.g. dimmability and
physical size) and consumer lighting preference.

The market for residential LED lighting has been observed by EnergyConsult to be small
but growing slowly (no data is readily available). EnergyConsult also considers that the
relatively high cost of LEDs remains the largest impediment to significant market growth in
the residential sector.

ABS lamp import data also shows that the penetration of 50W halogen downlights has been
growing rapidly since 2000, and indicates that there are more than 70 million of these lights
installed in Australia, in both residential and commercial sectors. This presents a potential
market for the installation of more efficient downlights.
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The key regulatory programs which have influenced the residential lighting market are as follows:

The phase-out of inefficient incandescent lamps commenced in 2009 (MEPS), with
the effect of phasing out various tungsten-incandescent lamps in favour of halogen
and CFL lamps.

MEPS for CFLs also came into effect in 2009, aimed at improving the quality of
CFLs.

MEPS for 12V halogen transformers/convertors came into effect in 2010. This
MEPS has eliminated magnetic transformers (efficiency ~80%) from the market in
favour of electronic (efficiency ~93%).

The MEPS standard for lamps was modified in April 2012 to begin to eliminate
sales of 12V 50W halogen directional lamps in favour of efficient 35W lamps.

The Building Code of Australia (BCA) lighting efficiency provisions came into
effect for all residential buildings in 2010, which means lighting efficiency and
energy use are considered in allocating an energy star rating to houses.
7.2 BAU Scenarios and Additionality Issues
Combined sales of 240V general purpose CFL and LED lamps, for use in the residential sector,
are not expected to grow significantly over the short to medium term. This is due to the near
market saturation of CFLs, the high capital cost of LEDs, and the current lack of efficacy
advantage of LEDs over CFLs.
EnergyConsult has concluded (see below) that the most appropriate energy efficiency activity for
residential lighting is the replacement (or conversion) of 12V halogen downlights to dedicated
CFL or LED units.
EnergyConsult considers that the BAU scenario for stock changeover from 50W halogen to 35W
halogen lamps (driven by MEPS) is likely to take at least 5 years. An estimation of the BAU
changeover from magnetic to electronic transformers (driven by MEPS) is likely to take many
more years (Beletich 2005).
The combination of these MEPS initiatives results in the following 2015 BAU scenario: the
average power of an installed 12V downlight is expected to be around 47W (average installed
transformer efficiency 0.9 and average lamp power 42.5W). 240V halogen downlights are
expected to continue to be 50W units (no transformer).
It is not clear whether the BAU scenario for downlights will involve a significant stock transition
to LED or CFL downlights. Predicting such a transition is likely to involve considerable
uncertainty. Thus, until any trends become clear, the medium term BAU scenario for 12V and
240V downlights is estimated to be around 47W, which does not include any significant BAU
transition to CFL/LED in the residential sector.
Energy savings from the replacement or upgrading of lighting should be additional to that which
would occur under the BAU scenario. As discussed in the previous section, the BAU scenario for
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12V and 240V downlights has been developed to take into account a BAU changeover to more
efficient 12V equipment (35W lamps and electronic transformers).
7.3 Recommended Activity Specification and Deemed Savings
7.3.1 Description and Specification of Activities
In developing specifications for lighting activities, the following principles have been followed:

replacement lighting options must be permanent (i.e. difficult to revert to an
inefficient light source);

replacement lighting options shall emit a similar quantity and quality of light to the
lighting technology being replaced;

replacement lighting options shall be proven, cost-effective, mass-market solutions;
and

lighting activities and deemed savings are agnostic to the lighting technologies
which are being replaced.
The most common residential lighting efficiency activities are as follows:

CFL/LED replacement lamp - 240V omnidirectional

CFL/LED replacement lamp - 240V directional

CFL/LED replacement lamp - 12V directional

35W halogen replacement lamp - 12V directional

35W halogen replacement lamp and electronic transformer - 12V directional

CFL/LED downlight or retrofit kit – replace/retrofit 12V/240V downlight.
These activities are discussed in detail below.
240V Omnidirectional Replacement Lamp: CFLs are well suited to omnidirectional
applications and are considered to be approaching market saturation in terms of technical
compatibility (e.g. dimmability and physical size) and consumer preference. In the context of a
potential NESI scheme, LEDs are not currently considered a viable wide scale alternative for
omnidirectional lights, due to their relatively high capital cost, lack of efficacy advantage in
comparison to CFLs, as well as problems with over-statement of performance. For these reasons,
further subsidy of CFLs or LEDs is not recommended in this category.
The NSW scheme and UK CERT scheme have deleted this activity due to large quantities of
CFLs being distributed and the significant increase in CFL retail sales and penetration in recent
years, due to both MEPS (phase-out of inefficient incandescent lamps) and wide take-up under
both schemes.
240V Directional Replacement Lamp: Whilst CFL and LED lamps may offer a reasonable
replacement for 240V directional lamps, the relatively small size of this (residential) market, along
with the ease of reverting to incandescent lamps, leads to the conclusion that this category is also
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not attractive in the context of a potential NESI. The NSW scheme and UK CERT scheme have
deleted this activity for the reasons mentioned above.
12V Directional Replacement Lamp / Transformer: Currently, integral-ballast 12V CFL and
12V LED replacement lamps cannot match the light output of 50W halogen lamps (≥500lm), and
many of these CFL/LED lamps suffer from compatibility (transformer/dimmer), reliability and
quality problems. There is also a risk that ineffective LED or CFL replacement lamps may revert
easily to halogen lamps. Thus it is not recommended to include LED or CFL 12V directional
replacement lamps in a NESI.
In April 2012, changes to lamp MEPS will begin to mandate the sale of high efficiency 35W
halogen replacement lamps, usurping 50W lamps. The same occurred with transformer MEPS in
2010, accelerating the transition to electronic transformers. Thus, activities involving installation
of 35W halogen replacement lamps and electronic transformers are not considered worthwhile for
a NESI.
Replace/Retrofit Downlight: CFL or LED downlights, or retrofit kits, are considered
appropriate efficiency activities, as these represent an effective and permanent solution which is
able to emit the quantity of light required when a 12V or 240V 50W halogen light is replaced.
This activity should be permanent, irreversible and involve the removal of the existing
transformer. All three state schemes currently include some form of activity aimed at
replacement/retrofit of halogen downlights.
A specification for the replacement/retrofit of 12V halogen downlights should broadly include the
following attributes:

similar light output to a typical 12V 50W halogen downlight (≥500lm);

light colour qualities including colour temperature suitable for households;

lumen output must be maintained for LEDs installed under this activity;

CFLs should meet Australian MEPS;

compatibility with dimmers; and

permanent and irreversible.
Significant work is required in order to develop a detailed specification for these downlights. The
VEET administrators are currently in the process of developing an LED downlight specification.
Recommendation: That the replacement (or conversion) of 12V halogen downlights to dedicated CFL or
LED units be included as the residential lighting activity in a NESI
7.3.2 The Calculations and Deemed Energy Savings
The VEET deemed savings from downlights depend on the light output, efficacy and lifetime of
the light installed. The REES and NSW deemed savings depend on lamp power and lifetime.
These approaches are similar, in that lamp power, efficacy and light output are related (efficacy =
light output ÷ lamp power). Lifetimes for all schemes are determined by the rated lifetime of the
lamps installed.
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All state methodologies involve a BAU lamp power for the light being replaced, although these
have not been updated to take account of recent MEPS affecting 12V downlights.
The simplest and recommended estimation method involves comparing the total power of the
replacement downlight with the BAU lamp power (47W) and then multiplying this by the life of
the replacement downlight, as follows:
Energy saving = (47W - P) x L
Where P = total power of LED/CFL light fitting
L = energy saving lifetime of replacement downlight (hours)
It is recommended that installed LED/CFL fittings be irreversible, i.e. reversion to a halogen
lamp is not possible. Because of this, the energy saving lifetime of the replacement downlight
should be equal to an appropriate time horizon (in years) multiplied by appropriate annual
operating hours. An appropriate time horizon is considered to be 15 years (i.e. beyond this the
building/space is likely to be refurbished). For living areas (which is where downlights are most
likely to be installed), operating hours of three hours per day would be expected. Thus, over 15
years, maximum operating hours of 15,000 hours are considered reasonable, i.e. L = 15,000 hours.
The methodology will not involve any variation by state.
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8 Televisions
8.1 Review of State-Based Energy Savings Schemes Activities
and Deeming Methodologies
8.1.1 State Activities’ Descriptions
Only VEET currently has an activity based on the sale of an efficient television. This
activity requires the television to achieve a minimum energy star rating of 5.5 and have a
maximum comparative energy consumption (CEC) of 450kWh p.a. (as determined by
AS/NZS 62087.2.2). Higher energy savings are awarded to more efficient televisions.
More detail is contained in Table 23.
Table 23: State television activities
Specification for
Replacement
Measure
AS62087.2.2, min
5.5 stars, max CEC
of 450kWh/yr
Energy savings
Variables
Screen area, CEC
Key Assumptions Used in Energy
savings Calculation
CEC from AS62087.2.2, 16 yr life,
compared to market average star
rating of 4 stars, seven hours/day
viewing time
8.1.2 Analysis of Deeming Methodology
The VEET deeming methodology is dependent on the television’s CEC and its screen
area, as specified in AS/NZS 62087.2.2. In addition the following aspects are taken into
account in the VEET deeming methodology for televisions:

Assumed television lifetime of 16 years

Baseline television assumed to be 4 stars

Assumed daily television viewing of 7 hours, rather than 10 as AS/NZS
62087.2.2 assumes

Energy savings is dependent on screen area.
8.1.3 Evaluation of Methodology
The VEET method for calculating energy savings is straightforward and considered
robust, in that it estimates energy savings based on the Australian Standard, which has
been through a rigorous peer review process. Note that VEET reduces daily viewing
hours from the Australian Standard assumptions. However an update of all assumptions
is considered timely.
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8.2 Review of Market
8.2.1 Television Market
Digital CEnergy 2009 estimates the stock of Australian televisions at 17.8 million in 2007.
EES 2011 reports that 3.036 million televisions were sold in 2010.
8.2.2 Market and Regulatory Trends
Mandatory MEPS and labelling for televisions has been in place since 2009, when the
MEPS limit of 1 star was adopted. In April 2013 the minimum MEPS limit for
televisions will change to 4.0 stars. EnergyConsult estimate that given existing trends
since 2009 towards increases in the efficiency of televisions, the sales-weighted average
star rating in 2013 is anticipated to be around 5.5 stars. This is the current threshold
specification for the VEET television activity.
8.3 BAU Scenarios and Additionality Issues
As discussed above, the BAU (with MEPS) scenario for televisions involves considerable
and rapid improvements in efficiency. For 2012, sales-weighted average star rating is
anticipated to be around 5.5 stars and this is increasing rapidly.
Energy savings from the purchase of efficient televisions should be additional to that
which would occur under the BAU scenario. As discussed in the previous section, the
BAU scenario for televisions involves significant improvements in efficiency.
Recommendation: Televisions should not be included in a potential NESI at this time because the
BAU efficiency of televisions is currently improving too rapidly. This recommendation should be reviewed
regularly in light of future developments in the BAU efficiency of televisions.
8.4 Recommended Activity Specification and Deemed Savings
8.4.1 Description and Specification of Activities
As discussed above, this activity is not considered feasible at the current time, given the
rapid improvements in BAU television efficiency.
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9 Pool Pumps
9.1 Review of State-Based Energy Savings Schemes Activities
and Deeming Methodologies
9.1.1 State Activities’ Descriptions
Only VEET and REES currently have activities based on the sale of efficient pool
pumps. Both of these schemes require complying pumps to be single phase, of
single/multiple/variable speed, with rated power of 100-1500W and with a minimum
energy star rating of 3.0 as outlined in AS 5102.1. Table 24 contains more detail.
Table 24: State pool pump activities
Specification
for
Replacement
Measure
Incumbent
Item
Energy
Savings
Variables
Key Assumptions
Used in Energy
Savings Calc
Projected
annual energy
consumption
(PAEC)
7 year life, compare to
market average star
rating of 2 stars, pump
50,000 litres/day
VEET
Single phase,
single/multiple/
variable speed,
100-1500W, min
3 star
N/A
REES
Single phase,
single/multiple/
variable speed,
100-1500W, min
3 star
N/A
PAEC, pump 7 year life, compare to
flow rate
market average star
rating of 2 stars, pump
50,000 litres/day
9.1.2 Comparison of Deeming Methodologies
The energy savings result from the VEET deeming methodology is dependent only on
the pump’s PAEC (projected annual energy consumption) as outlined in AS 5102.1. The
REES deeming methodology is dependent on the PAEC as well as the rated flow rate of
the pump.
In addition the following aspects are relevant to both the VEET and REES
methodologies:

Assumed pump lifetime of seven years

Assumed baseline pool pump is rated 2 stars
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9.1.3 Evaluation of Methodologies
The method for calculating energy savings is based on the Australian Standard. However
several problems with the standard have been identified by industry stakeholders, which
could hamper their introduction into a NESI in the short term:

The most efficient pumps pump at a low rate, which means they take a long time to
pump the required volume of water, or possibly may not be able to pump the
required volume of water.

There is uncertainty surrounding the BAU efficiency of pool pumps (discussed
below).
Recommendation: That pool pumps should not be incorporated into a NESI until the
technical issues with the rating scheme have been resolved.
9.2 Review of Market
9.2.1 Pool Pump Market
Seebacher 2009 estimates that in 2009 more than 1 million or 12% of households have a
swimming pool, and that this will rise to 1.25 million by 2020. There are estimated to be
around 1.5 pumps per pool each with a lifetime of about five years. Two states dominate
the backyard pool landscape: New South Wales with 40% of pools and Queensland with
30% of pools. Queensland has the highest number of pools per household, with 17%
having a pool. New South Wales and Western Australia each have a pool penetration rate
of 13%.
The draft consultation RIS (currently under preparation by DCCEE to assess the impact
of introducing mandatory MEPS and labelling for pool pumps) estimates that the salesweighted average energy Star Rating Index (SRI) for pool pumps is currently around 3.6
stars. VEET and REES both currently use a baseline rating of 2 stars.
9.2.2 Market and Regulatory Trends
There are no mandatory regulations for pool pump efficiency. However, Australia
currently has a voluntary energy label scheme for swimming pool pumps. The authors
were unable to obtain data relating to trends in pool pump efficiency.
9.3 BAU Scenario and Additionality Issues
As discussed above, the draft consultation RIS for pool pumps (currently unpublished)
estimates that the sales-weighted average SRI for pool pumps is currently around 3.6
stars. No trends in pool pump efficiency have been identified.
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Energy savings from the purchase of efficient pool pumps should be additional to that
which would occur under the BAU scenario. There will always be some situations where
an individual will have undertaken the upgrade regardless of a NESI activity, but provided
the calculations of the energy savings are based on the average behaviour in the BAU
scenario and upgrade situation, this will not significantly impact on the deemed savings
calculation accuracy.
9.4 Recommended Activity Specification and Deemed Savings
9.4.1 Description and Specification of Activity
As discussed above, this activity is not considered feasible at the current time, given the
uncertainty surrounding assumptions in the Australian Standard for pool pumps.
However, given the potential savings from this activity, it is recommended that further
research and investigation be undertaken to resolve the technical issues with the pool
pump energy rating scheme so as to enable this activity to be introduced in the future.
Recommendation: That a possible NESI not include pool pumps as an eligible activity at
the current time. Consideration should be given to including pool pumps in a possible NESI when
technical issues with the pool pump energy rating scheme are resolved.
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10 Efficient Whitegoods Activities
10.1
Review of State-Based Energy Savings Schemes
Activities and Deeming Methodologies
10.1.1
State Activities’ Descriptions
10.1.1.1 VEET
The VEET scheme offers deemed energy savings from the purchase of fridges/freezers
and clothes dryers. Fridges and freezers must have a minimum star rating, and capacity is
limited to a range (see Table 25 for more detail). The energy savings result is then
dependent on the unit’s capacity and its CEC (comparative energy consumption, as
determined by AS/NZS 4474.2).
VEET requires clothes dryers to be either electric (minimum 5 stars) or gas powered.
The energy savings result is then dependent on the dryer capacity.
10.1.1.2 REES
The REES has no activities involving the purchase of high efficiency appliances as these
activities were not found to be cost effective in the 2011 review.
10.1.1.3 NSW
The NSW scheme offers deemed energy savings from the purchase of fridges/freezers,
clothes washers and dishwashers. Energy savings are based on star rating, capacity and
top/front loading (clothes washers only).
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Table 25: State whitegoods activities
VEET
Activity
Fridge/freezer - single door
Fridge/freezer - two door
Fridge/freezer - chest
freezer
Fridge/freezer - upright
freezer
Specification for
Replacement
Measure
NSW
Incumbent
Item
100-500 litres, min
N/A
2 stars
100-700 litres, min
N/A
2.7 stars
100-700 litres, min
N/A
3.3 stars
100-400 litres, min
N/A
2.5 stars
Energy
Savings
Variables
Key
Specification
Assumptions
for
Used in Energy Replacement
Savings Calc
Measure
CEC,
volume
17 year life,
compare to
market
average (1.35
stars)
CEC,
volume
17 year life,
compare to
market
average (2.39
stars)
CEC,
volume
21 year life,
compare to
market
average (2.75
stars)
CEC,
volume
21 year life,
compare to
market
average (2.0
stars)
VEET
Activity
Specification for
Replacement
Measure
Incumbent
Item
Energy
Savings
Variables
Dishwasher
Not included in this
scheme
Not included in this
scheme
Star rating
Star rating
Star rating,
volume
Compared to
a market
average
product,
lifetime
unknown
Star rating,
volume
Compared to
a market
average
product,
lifetime
unknown
Star rating,
volume
Compared to
a market
average
product,
lifetime
unknown
Star rating,
volume
Compared to
a market
average
product,
lifetime
unknown
Incumbent
Item
Energy
Savings
Variables
Key
Assumptions
Used in
Energy
Savings Calc
N/A
N/A
N/A
N/A
N/A
-
-
Key
Specification
Assumptions
for
Used in Energy Replacement
Savings Calc
Measure
Dryer
capacity
12 year life,
compare to
market
average star
rating of 1.6
stars, 78 uses
p.a.
Not included in
this scheme
-
-
-
Dryer
capacity
12 year life,
compare to
market
average
electric dryer,
78 uses p.a.
Not included in
this scheme
-
-
-
Clothes Dryer
Clothes washer
Star rating
Key
Assumptions
Used in
Energy
Savings Calc
NSW
Min 5 star electric. N/A
Gas
Star rating
Energy
Savings
Variables
Incumbent
Item
-
-
-
-
Star rating
Star rating
N/A
Compared to
a market
Top/front
average
loading, star
product,
rating
lifetime
unknown
N/A
Compared to
a market
No. place
average
settings, star
product,
rating
lifetime
unknown
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10.1.2
June 2012
Comparison of Deeming Methodologies
10.1.2.1 VEET
The VEET deeming methodology for fridges and freezers is dependent on the unit’s
CEC (comparative energy consumption p.a.) and its volume, as specified in AS/NZS
4474.2. In addition the following aspects are taken into account in the VEET deeming
methodology for fridges and freezers:

assumes lifetime of 17 years for fridges and 21 years for freezers;

star rating of baseline unit (see Table 25); and

CEC reduced by 15% as the AS/NZS 4474.2 test tends to overestimate
energy consumption for Victoria.
The VEET deeming methodology for electric clothes dryers is dependent on the unit’s
CEC (comparative energy consumption p.a.) and its capacity, as specified in AS/NZS
2442.2. In addition the following aspects are taken into account in the VEET deeming
methodology for electric clothes dryers:

assumes a lifetime of 12 years;

star rating of baseline unit is 1.6 stars; and

78 uses per year.
Gas powered clothes dryers in VEET are dealt with in a separate section, below.
10.1.2.2 NSW
The deeming methodology for NSW whitegoods activities is not available to the authors,
although it is understood to use a similar approach to VEET, in that the comparative
energy consumption (CEC) of the purchased product (derived from its star rating) is
compared to a baseline (market average) unit.
10.1.3
Evaluation of Methodologies
The methods used by the schemes for calculating energy savings are straightforward and
considered robust, in that they estimate energy savings based on Australian Standards
(adjusted where considered appropriate). However a review of all assumptions, i.e. to
take account of recent market development including recent MEPS, should be
considered.
10.2
Review of Market
10.2.1
Whitegoods Market
The 2009 sales-weighted star rating indices (SRIs) for the various groups of refrigerators
and freezers are listed in Table 26 and these are compared to VEET baseline SRIs in the
table (NSW baseline assumptions were not available to the authors). Note that VEET
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does not currently include group 2 and 3 refrigerators as these units are typically low
capacity fridges (~120 litres) from which it is difficult to generate one VEET certificate. A
comparison with the NSW assumptions could not be undertaken as this information is
not publically available.
Table 26: Fridge/freezer sales and sales-weighted star rating (source: EES 2010B)
2009 SalesWeighted SRI
VEET
Baseline
2009 Sales
Quantity
Group 1: Refrigerator without a low temperature
compartment, automatic defrost.
1.6
1.35
51,117
Group 2: Refrigerator with or without an ice-making
compartment, manual defrost
1.2
Not included
133,338
Group 3: Refrigerator with a short or long term frozen
food compartment, manual defrost
1.2
Not included
4,295
Group 4: Refrigerator-freezer, fresh food compartment
is automatic defrost, freezer manual defrost (“partial
automatic defrost”)
2.1
2.39
1,479
Group 5B: Refrigerator-freezer, both compartments
automatic defrost (frost free), bottom mounted freezer
2.1
2.39
154,098
Group 5T: Refrigerator-freezer, both compartments
automatic defrost (frost free), not side by side
configuration or bottom mounted freezer (i.e. top
mounted freezer)
2.4
2.39
447,039
Group 5S: Refrigerator-freezer, both compartments
automatic defrost (frost free), side by side configuration
1.9
2.39
147,572
Group 6U: Separate vertical freezer, manual defrost
2.1
2.0
70,321
Group 6C: Separate chest freezer, all defrost types
2.6
2.75
86,756
Group 7: Separate vertical freezer, automatic defrost
(frost free)
1.5
2.0
37,459
Table 27 contains 2009 sales-weighted SRI for clothes dryers, clothes washers and
dishwashers, along with the VEET baseline (where VEET includes this activity). Note
that NSW baseline assumptions were not available to the authors.
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Table 27: Other whitegoods sales-weighted star rating (source: EES 2010B)
2009 SalesWeighted SRI
VEET Baseline
Clothes dryer
1.79
1.6
Clothes Washer
3.06
Not included
Dishwasher
3.09
Not included
10.2.2
Market and Regulatory Trends
The sales-weighted star rating indices (SRIs) of refrigerators and freezers are depicted in
Figure 2, and this information is used in the following sections in order to draw
conclusions about the direction of the market. In this figure, a step change in SRI can be
seen in 2004-2005, after which the average SRI appears to plateau.
Figure 2: Trends in sales-weighted SRI – refrigerators and freezers (source: EES 2010B)
The SRIs of dishwashers, clothes washers and dryers are depicted in Figure 3. Gradual
improvement in SRI is evident for these appliances.
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Figure 3: Trends in sales-weighted SRI – other whitegoods (source: EES 2010B)
Whitegoods have been required to carry an energy rating label in Australia for more than
20 years. However the only whitegoods that are required to meet MEPS in Australia are
refrigerators and freezers.
10.3
BAU Scenario and Additionality Issues
Detailed trends in sales-weighted SRIs for refrigerators and freezers are depicted in Figure
4 and Figure 5. The groups refer to the refrigerator types identified in Table 26.
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June 2012
Figure 4: Trends in sales-weighted SRI – refrigerators by group (source: EES 2010B)39
Figure 5: Trends in sales-weighted SRI – freezers by group (source: EES 2010B)
As discussed above, sales-weighted average SRIs have plateaued for refrigerators and
freezers in recent years, and improvements in SRIs for other whitegoods occur at a slow
pace.
The negative SRI are an indication that the appliances energy efficiency were below that which would be given a
zero SRI on the current rating scale. This can occur as the SRI measurement scale has been changed over time as
the minimum efficiency of the appliances improved.
39
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June 2012
Recommendation: That recent sales-weighted SRI values be used as BAU baselines for a
NESI activity.
Energy savings from the purchase of efficient whitegoods should be additional to that
which would occur under the BAU scenario. There will always be some situations where
an individual will have undertaken the upgrade regardless of a NESI activity, but provided
the calculations of the energy savings are based on the average behaviour in the BAU
scenario and upgrade situation, this will not significantly impact on the deemed savings
calculation accuracy.
10.4
Recommended
Savings
10.4.1
Activity
Specification
and
Deemed
Description and Specification of Activities
The activity involves purchase of whitegoods with higher efficiency than the market
average.
The following minimum SRIs are considered appropriate as the minimum technical
specifications for high efficiency appliance purchases. Note that each of these
specifications is 0.5 stars higher than the average 2009 sales-weighted SRI (Table 26).
They are not used in the calculation of energy savings, but solely as the minimum
specifications for high efficiency appliance purchases.

Fridge/freezer Group 1:
2.1

Fridge/freezer Group 2:
1.7

Fridge/freezer Group 3:
1.7

Fridge/freezer Group 4:
2.6

Fridge/freezer Group 5B:
2.6

Fridge/freezer Group 5T:
2.9

Fridge/freezer Group 5S:
2.4

Fridge/freezer Group 6U:
2.6

Fridge/freezer Group 6C:
3.1

Fridge/freezer Group 7:
2.0

Dishwasher:
3.6

Clothes washer:
3.1

Clothes dryer:
2.3
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10.4.2
June 2012
The Calculations and Deemed Energy Savings
The VEET methodology for refrigerators, freezers and electric clothes dryers is
considered appropriate. However it would be prudent to revise the baseline star rating
index as outlined above.
There is likely to be slight variation in refrigerator and freezer energy consumption from
state to state, due to climatic differences (in the order of 15% which is the reduction used
by VEET). However, due to the relatively small size of these differences (in comparison
to say those found in space heating and water heating) it is not recommended to vary
deemed energy savings by state. Using a nationally consistent approach appears more
worthwhile than slightly increasing geographical accuracy in the energy savings estimates.
The national approach would enable an identical energy savings to be allocated to this
activity across all jurisdictions.
A similar method for estimating energy savings was taken for dishwashers and clothes
washers, calculating the energy savings by comparing the energy consumption of the unit
installed to the sales-weighted average.
10.4.2.1 Refrigerators and Freezers
The SRI for fridges and freezers is given by the following equation (the equation, its
terms and values are as described in the Australian Standard):
SRI = 1 + [ loge(CEC/BEC) / loge (1-ERF) ]
Where
CEC = annual energy consumption
BEC = baseline energy consumption = Cf + Cv x (Vadj tot)0.67
ERF = energy reduction factor = 0.23
Cf = fixed allowance factor (150 or 200, depending on group)
Cv = variable allowance factor (4, 8.8 or 7.5, depending on group)
Vadj tot = adjusted total volume (according to Australian Standard)
For fridges and freezers, the sales-weighted average unit (with sales-weighted average star
rating = SRIav) has a CEC calculated as follows (derived from the Australian Standard):
CECav
= [ Cf + Cv x (Vadj tot)0.67 ] x e ln(1-ERF)x(SRIav-1)
As ERF is constant for all groups (0.23) then this becomes (in kWh):
CECav
= [ Cf + Cv x (Vadj tot)0.67 ] x e-0.26136x(SRIav-1)
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Over a life of L years, the energy saving (in MWh) for a fridge/freezer with a rated annual
energy consumption CEC is given as follows:
Energy saving (MWh)
= L x (CECav – CEC) / 1000
Constants for these two key equations are given in Table 28.
Table 28: Fridge and freezer constants
Group
Fixed
Sales-Weighted
Allowance VariableAllowance Average Star
Factor (Cf)
Factor (Cv)
Rating (SRIav)
Life (L,
years)
1
200
4.0
1.61
17
2
200
4.0
1.19
17
3
200
4.0
1.18
17
4
150
8.8
2.10
17
5B
150
8.8
2.06
17
5S
150
8.8
1.89
17
5T
150
8.8
2.43
17
6C
150
7.5
2.59
21
6U
150
7.5
2.13
21
7
150
7.5
1.51
21
10.4.2.2 Dishwashers
The SRI for dishwashers is given by the following equation (from the Australian
Standard):
SRI = 1 + [loge (CEC/BEC) / loge (1-ERF) ]
Where
CEC = annual energy consumption
BEC = 48 x place settings40
ERF = energy reduction factor = 0.3
For dishwashers, the sales-weighted average unit (with sales-weighted average star rating
= SRIav) has a CEC given as follows (derived from the Australian Standard):
Place settings if the measure of the size of dishwashers used in the market, referring to how many set of plates they
can wash at a time.
40
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CECav
June 2012
= 48 x Place Settings x e ln(1-ERF)x(SRIav-1)
As ERF is constant (0.3) and SRIav in 2009 was 3.09, this becomes (in kWh):
CECav
= 48 x Place Settings x e-0.35667x(3.09-1)
CECav
= 22.8 x Place Settings
Over a life of L years, the energy saving (in MWh) for a dishwasher with a rated annual
energy consumption CEC is given as follows:
Energy saving (MWh)
= L x (CECav – CEC) / 1000
A dishwasher life of 12 years is considered appropriate.
10.4.2.3 Clothes Washers
For clothes washers, the star rating index is also influenced by the spin performance of
the machine, as it is assumed that some of the load will be put into a dryer. So the normal
ratio of CEC/BEC in the SRI equation is replaced as follows (equation and terms from
the Australian Standard):
SRI = 1 + { loge [(CEC+Em)/(BEC+Eref)] / loge (1-ERF) }
Where
CEC = annual energy consumption
BEC = 115 x rated capacity (RC)41
ERF = energy reduction factor = 0.27
Em42 = (F x WEI x RC x 365) / 1.08
F = 0.1
WEI = water extraction index for the model
Eref = (F x WEIref x RC x 365) / 1.08
WEIref = 1.03
41
Measured in kilograms of clothes will wash.
Em is the equivalent energy of residual moisture retained after spinning. It is a measure of the spin performance
of the rated clothes washer, which allows for a proportion, F, of clothes being placed in a clothes dryer. Eref is the
Em measure for the reference clothes washer.
42
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June 2012
For clothes washers, the sales-weighted average unit (with sales-weighted average star
rating = SRIav) has a CEC given as follows (derived from the Australian Standard):
CECav
= (115 x RC + Eref) x e ln(1-ERF)x(SRIav-1) - Em
= {115 x RC + [(0.1 x 1.03 x RC x 365) / 1.08] x e ln(1-ERF)x(SRIav-1) - (0.1 x
WEI x RC x 365) / 1.08
As ERF is constant (0.27) and SRIav in 2009 was 3.06, this becomes:
CECav
= (115 x RC + 34.81 x RC) x e-0.3147x(3.06-1) – 33.8 x RC x WEI
= (115 x RC + 34.81 x RC) x 0.523 – 33.8 x RC x WEI
= RC x [(115 + 34.81) x 0.523 - 33.8 x WEI]
= RC x (78.35 - 33.8 x WEI)
In 2009 the sales-weighted average WEI for top loading machines was 0.69, thus (in
kWh):
CECav
= RC x (78.35 - 33.8 x 0.69)
CECav
= RC x 55
Over a life of L years, the energy saving (in MWh) for a clothes washer with a rated
annual energy consumption CEC is given as follows:
Energy saving (MWh)
= L x (CECav – CEC) / 1000
A clothes washer life of 12 years is considered appropriate, based on market research used
for the VEET scheme.
10.4.2.4 Electric Clothes Dryers
The SRI for electric clothes dryers is given by the following equation (from the Australian
Standard):
SRI = 1 + [loge (CEC/BEC) / loge (1-ERF) ]
Where
CEC = annual energy consumption
BEC = baseline energy consumption = 53 x capacity43
ERF = energy reduction factor = 0.15
43
Measured in kilograms of clothes will dry.
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June 2012
For clothes dryers, the sales-weighted average unit (with sales-weighted average star rating
= SRIav) has a CEC calculated as follows:
CECav
= 53 x capacity x e ln(1-ERF)x(SRIav-1)
As ERF is constant (0.15) and SRIav in 2009 was 1.79, this becomes this becomes
(derived from the Australian Standard, in kWh):
CECav
= 53 x capacity x e-0.1625x(1.79-1)
CECav
= 46.6 x capacity
Over a life of L years, the energy saving (in MWh) for a clothes dryer with a rated annual
energy consumption CEC is given as follows:
Energy saving (MWh)
= L x (CECav – CEC) / 1000
A clothes dryer life of 12 years is considered appropriate, based on market research used
for the VEET scheme. Note that 52 uses p.a. have been assumed rather than 78 as
assumed by VEET, as clothes dryers will be used less on average across Australia than in
Victoria, as many jurisdictions in a NESI will be warmer and dryer.
10.4.2.5 Gas Clothes Dryers
The only whitegoods activity that involves fuel switching is gas powered clothes dryers.
The annual energy consumption associated with this activity has been calculated as
follows (52 uses p.a.):
 BAU energy consumption of electric unit (electricity, kWh p.a.) = CECav= 46.6 x
capacity (from above).
 Electricity consumption of typical 4kg gas unit (kWh p.a.) = 3 x capacity (data
supplied by manufacturer to VEET).
 Gas consumption of typical 4kg gas unit (MJ p.a.) = 188 x capacity (data supplied
by manufacturer to VEET).
Thus the lifetime (L years) energy saving for a typical 4kg unit would be calculated as
follows:
Energy saving (MWh) = Electricity saving
= 43.6 x 4kg x L/1000
Energy saving (MWh)
-
gas use
-
(188 x 4kg / 3.6) x L/1000
= 0.174 x L (electricity)
-
0.209 x L (gas)
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June 2012
A clothes dryer life of 12 years is considered appropriate, based on market research used
for the VEET scheme, and is consistent with the life time used for electric clothes dryers.
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June 2012
11 Fridge Disposal Activities
11.1
Review of State-Based Energy Savings Schemes
Activities and Deeming Methodologies
11.1.1
State Activities’ Descriptions
All three state schemes offer deemed energy savings from the destruction of a pre-1996
fridge and all schemes require that the refrigerant be disposed of appropriately. REES
requires that the fridge be greater than 250 litres capacity. NSW requires that the fridge
be greater than 200 litres capacity. Note that VEET has no capacity requirement. VEET
and REES both require that the fridge be in working order. REES also requires that the
fridge is a secondary fridge (not providing primary service). Table 29 contains more
detail.
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June 2012
Table 29: State fridge disposal activities
VEET
Specification for
Replacement
Measure
Pre 1996
fridge/freezer,
working order,
ozone disposal
REES
Energy
Savings
Variables
Single/two
door
Key
Assumptions
Specification for
Used in Energy Replacement Measure
Savings Calc
Average old
fridge is ~1995,
+20% CEC for
degradation, 15% CEC for
climate, fridge
not replaced, 7
year remaining
service life
NSW
Energy
Savings
Variables
Pre 1996 fridge/freezer,
secondary unit, >250
litres (100 litres freezer), Nil
working order, ozone
disposal
Key
Specification
Assumptions
for
Used in Energy Replacement
Savings Calc
Measure
Average old
fridge is ~1995,
+10% CEC for
degradation, 10% CEC for
climate, 75%
of fridges
replaced, 4
year remaining
service life
Pre 1996
fridge/freezer,
>200 litres,
ozone disposal,
Energy
Savings
Variables
Primary /
secondary
unit, fridge
group
Key
Assumptions
Used in
Energy
Savings Calc
Unknown
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11.1.2
June 2012
Comparison of Deeming Methodologies
All schemes offer energy savings solely from reduced electricity consumption, i.e. they do
not include any benefit from the destruction of refrigerant gases.
VEET offers two levels of energy savings, one for single door and one for two door
refrigerators. REES offers only one energy savings value. The NSW scheme offers
various energy savings values based on the fridge category and whether or not it is the
primary fridge of the house.
Both REES and VEET use the following assumptions in their energy savings calculations:

assumed lifetime of 7 years (VEET) and 4 years (REES);

sales weighted market averages for fridge performance and typical age;

various assumptions regarding primary and secondary fridge operation;

CEC reduced as the AS/NZS 4474.2 test tends to overestimate energy
consumption for southern states where majority appliance stock resides;
and

increase in energy consumptions of old fridge, due to degradation.
Details of the NSW methodology were not able to be obtained by the authors, however
the methods are expected to be substantially the same.
11.1.3
Evaluation of Methodologies
Calculation of energy savings from this activity is complex, as it involves several
assumptions regarding the old fridge (e.g. primary or secondary) as well as a potential new
fridge. The number of assumptions used means that energy savings from this measure
are likely to involve considerable uncertainty. Hence it is recommended that assumptions
for this activity be reviewed as new information becomes available and continue to be
standardised wherever possible.
11.2
Review of Market
11.2.1
Fridge Market
The efficiency of new refrigerators and freezers sold has increased over time, as can be
seen in the previous chapter, which discusses considerable improvement in fridge and
freezer efficiency, particularly from around 1996 onwards.
The purpose of disposing of old units is to bring forward the purchase of new, efficient
primary fridges, and to retire secondary fridges (with the objective of these units not
being replaced).
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11.2.2
June 2012
Market and Regulatory Trends
As discussed above, there has been a significant trend to better efficiency over time,
especially since 1996. These trends have been driven primarily by MEPS and energy
labelling for fridges, which have been in place for more than 20 years.
11.3
BAU Scenario and Additionality Issues
The BAU scenario involves continued use of pre-1996 fridges and freezers until their
natural retirement. Given the average lifetime of fridges and freezers (17 years and 21
years respectively, from above), the stock of pre-1996 fridges and freezers is declining.
Figure 6 represents the age versus retirement function for Australian refrigerators, based
on EnergyConsult analysis drawing on the AGO 1999 study.
Figure 6: Retirement function for refrigerators
120.00%
% Cohort In Service
100.00%
80.00%
60.00%
40.00%
20.00%
0.00%
1
3
5
7
9
11
13
15
17
19
21
23
25
27
29
31
33
35
37
39
Age (years)
11.4
Recommended
Savings
11.4.1
Activity
Specification
and
Deemed
Description and Specification of Activity
The activity involves the removal and appropriate disposal of pre-1996 fridges and
freezers, including primary and secondary units.
11.4.2
The Calculations and Deemed Energy Savings
The assumptions used by REES, including a remaining service lifetime of four years, are
the most recently reviewed, and it is recommended that a similar set of assumptions be
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June 2012
used in a NESI. The analysis performed for REES in 2011 (EC 2011b) estimates energy
savings from disposal of a second fridge/freezer as follows:

primary fridge/freezer: 1.4 MWh

secondary fridge/freezer: 2.0 MWh.
The REES figures include a 10% escalation for performance degradation over time, and a
10% decrease in energy use due to there being a lower cooling load in the South
Australian climate. The latter can be removed in order to calculate an Australian average,
which could be used for a possible NESI, as follows:
Primary fridge/freezer: 1.54 MWh.
Secondary fridge/freezer: 2.2 MWh.
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12 In-home Displays
12.1
Review of State-Based Energy Savings Schemes
Activities and Deeming Methodologies
12.1.1
State Activities’ Descriptions
An in-home electricity display (IHD) displays total household energy consumption in real
time, with the objective of encouraging users to reduce energy consumption. Only the
VEET scheme currently has an activity based on the installation of an IHD. VEET
requires complying IHDs to have the following attributes:

Zigbee wireless enabled (Zigbee is a wireless communications protocol
analogous to WiFi);

capable of logging 30 second intervals;

incorporating at least 45 days memory capability;

capable of displaying energy cost information;

consume ≤0.6W;

five year battery life (if battery fitted); and

5% measurement inaccuracy or better.
Table 30 contains more detail.
Table 30: VEET IHD activities
Specification for
Replacement
Measure
Energy
savings
Variables
Key Assumptions Used in Energy
savings Calculations
Zigbee enabled, ≤30
second intervals, ≥45
days memory, display
cost, ≤0.6W, 5yr battery
if fitted, ≤5% accuracy
Installed in gas
reticulated area
or not
6.6% electricity reduction, gas
households use 5882kWh electricity
p.a., non-gas use 7765kWh p.a., 5 year
persistence
12.1.2
Analysis of Deeming Methodology
The VEET deeming methodology is based on the following assumptions, which were
developed in a recent report (Accenture 2011):

6.6% electricity consumption reduction;

Gas households use 5882kWh electricity p.a.;

Non-gas households use 7765kWh p.a.;

5 year persistence of energy conservation behaviour; and
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
12.1.3
June 2012
Energy savings dependent on gas reticulation in the area.
Evaluation of Methodologies
The basis of the method for calculating energy savings is straightforward, however it is
considered prudent to study the actual energy savings of installed IHDs in the VEET, as
well as their persistence, in order to provide further robustness to these variables. The
methodology rests on estimated average savings obtained in similar schemes, and it
remains to be seen if this savings will be obtained in Victorian households and if the
savings persist.
12.2
Review of Market
IHDs are considered a relatively “soft” activity, in terms of their ability to deliver energy
savings and reliability of the energy savings they produce. Their inclusion in a national
NESI should be reviewed and a decision taken as to whether this type of activity is
appropriate and in line with objectives and principles of a possible national NESI scheme.
12.2.1
IHD Market
The authors observe that simple IHDs are sold in electronics retailers throughout
Australia, although these would not comply with the VEET requirements. In the absence
of sales data, anecdotal evidence suggests that the sales and penetration of VEETcompliant IHDs is likely to be negligible at present (not including any installations
facilitated by VEET).
12.2.2
Market and Regulatory Trends
The sales of simple IHDs are likely to have increased in recent years, as indicated by their
increased availability and proliferation of models, but stock levels are likely to still be very
low. Also, sale numbers of sophisticated IHDs, such as those that would meet the VEET
specification, are likely to be very small. There are currently no regulations affecting IHD
performance, except for safety requirements relating to all electrical appliances.
12.3
BAU Scenario and Additionality Issues
As the penetration of IHDs is likely to be low, we can reasonably assume that it is not
significant, and thus that the BAU scenario for installation of IHDs can be reasonably
assumed to be zero.
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12.4
Recommended
Savings
12.4.1
Activity
Specification
June 2012
and
Deemed
Description and Specification of Activity
The activity would involve the installation of IHDs which provide householders with real
time energy consumption information. It is not recommended to include this activity
until an evaluation of energy savings from the VEET scheme can be undertaken.
12.4.2
The Calculations and Deemed Energy Savings
As discussed above, the basis of the VEET method for calculating energy savings is
straightforward, however it is considered prudent to study the actual energy savings of
installed IHDs in the VEET, as well as their persistence, in order to provide further
robustness to these variables, prior to inclusion of this activity in a potential NESI. If an
activity involving the installation of IHDs was to be included in a possible NESI, then the
energy savings would be calculated as follows:
Energy Savings (MWh)
= Expected saving % x Average electricity consumption
x Life of activity
However, further research is required to determine the key variables in this equation, the
extent of the expected savings and the persistence/life of the activity. Only when this
information is available can the expected savings from IHD be determined for a possible
NESI.
Recommendation: That the actual energy savings of installed IHDs be studied for an
extended period in order to confirm the average savings rate and the length of time this action
persists, prior to implementing the action.
In addition, the average electricity consumption for gas/non-gas households in each
jurisdiction, and possibly also climate zone, will need to be researched prior to including
this activity.
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13 Standby Power Controller
13.1
Review of State-Based Energy Savings Schemes
Activities and Deeming Methodologies
13.1.1
Descriptions of State Activities
Standby power controllers (SPC) are sophisticated power boards where a household’s
audio-visual appliances or IT devices can be plugged into a power board which will enable
all the devices to be switched off at the one time, or alternatively for peripheral devices to
be switched off when the main television or computer does not require their use. As the
SPC switches off appliances when they are not being used, it reduces unnecessary power
consumption from all these devices.
SPCs can be divided into the less sophisticated, master-slave SPC and more sophisticated
SPCs. The master-slave SPC operates by switching off all peripheral/slave devices when
the master appliance, the television or computer, is switched off. This means, for
example, when the television is switched off then game consoles, DVD players and audio
amplifiers attached to the SPC will all be switched off at the same time. The more
sophisticated SPCs will monitor use of remote controls, movements in the room, and
operating mode of the main and peripheral devices and use this information to switch off
the main and peripheral devices as required. This enables the more sophisticated SPC to
save more standby power than is possible with the simple master-slave SPC.
The SPC is also divided into audio-visual SPC, which are attached to televisions and their
peripherals, and IT SPC which are attached to computers and their peripherals. The
VEET and REES schemes allow the installation of SPC as activities, but not the NSW
ESS. The schemes require that the SPC be installed and attached to either a computer or
television and its peripherals, in order to qualify as an eligible activity and receive
certificates.
13.1.2
Comparison of Deeming Methodologies
The deeming methodologies used in the VEET and REES schemes are identical, as the
REES simply references the VEET regulations concerning standby power controllers.
The only difference between the schemes deeming methodology is the greenhouse
emission factor used to convert energy savings to emission savings.
The deeming methodology consists of two parts: a default deemed energy savings for less
sophisticated master-slave standby power controllers, and an option to undertake a field
trial to determine the actual energy savings for more sophisticated standby power
controllers.
The methodology used to calculate the default deemed energy savings is based on
engineering calculations of the amount of standby power saved by audio-visual or IT
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peripherals being switched off, and research on the standby energy consumption of a
range of peripheral devices. The calculations also rely on researched averages and
estimates for households concerning:

how many hours per day the computer or television is used;

how many peripherals are attached to the computer or television;

the nature of typical peripherals and their average active standby, passive
standby and off mode consumption;

the time each peripheral will spend in active, passive and off mode; and

the BAU improvement in the standby consumption of peripherals.
A critical assumption in the deeming methodology is that the householder will continue
to use the SPC, and not disconnect one or more of the peripherals due to the potential
inconvenience of having these switched off automatically. The assumption also is that the
SPC will be used for its estimated lifetime of 10 years. However, these assumptions need
to be confirmed by relevant market research.
Recommendation: That a survey be conducted, before the implementation of a possible
NESI, of households who have received SPCs via the VEET or REES to determine whether the
SPC is still installed and the number of peripherals that are attached to the SPC. That this
research be used to modify assumptions concerning the number of peripherals attached to SPCs and
the length of their operating lives.
The default deemed savings for audio-visual SPCs were calculated by multiplying for each
peripheral the power savings in each mode by that time in each mode, and summing the
results for all audio-visual peripherals. The process was then repeated for all IT
peripherals. The emission saving results were then rounded to the nearest whole number,
which resulted in the deemed emission saving in Victoria being equal to 1 tonne CO2e for
both audio-visual SPC and IT master-slave SPC.
13.1.2.1 Field Trial Methodology
The methodology used in the field trials44 of the more sophisticated SPCs is more
complex. Each new brand/model SPC, that aims to qualify for more than the default
deemed savings of an SPC, must undertake a field trial to determine the deemed savings
for the SPC. So far between five and 10 SPCs have been submitted to undertake field
trials over the last 12 months.
The trails are conducted in samples of homes and the data collected and analysed by
independent consultants, who present their research findings to the Victorian Essential
Services Commission (ESC) for further analysis and approval. The ESC then allocated a
deemed emission saving to the products, depending on the result of the field trail.
Explanatory Note – Field Trails for Standby Power Controllers, Version 1.1 – 16 August 2011,
https://www.veet.vic.gov.au/Public/Public.aspx?id=ProductApproval.
44
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June 2012
A sample of 20 or more households is used in each field trial, and in each household in
the sample the SPC being tested is connected to the household’s audio-visual or IT
equipment. Data loggers are also connected to this equipment and used to keep accurate
records of the energy consumption of televisions or computers, and their peripherals.
The information on the energy consumption of the equipment is recorded for both when
the standby power controller is not operating, and also when it is operating. The data is
then analysed to determine how the SPC affected power consumption in the main device
and its peripherals, and to determine what would have been the change in power
consumption if the standby power controller had been operating in each of the
households.
The field trial results are used to determine the average savings across all the households
that may use the SPC. The information is normalised, by calculating what the impact of
the device would be on an average home, so as to determine an estimate of the average
energy savings in an average household. The energy savings are then converted to an
estimate of the greenhouse emission savings, using an appropriate emission factor for the
different states.
13.1.3
Evaluation of Methodologies
One of the strengths of this methodology is that it eliminates the need for expensive field
trials for the less sophisticated SPCs. However, it still permits the use of the field trial to
determine the energy savings of more sophisticated devices, which encourages the SPC
developers to improve the effectiveness of the devices.
A significant challenge for the methodology is that the estimates of the default energy
saving of master-slave standby power controllers rests on information concerning the
nature and number of peripherals attached to televisions and home computers, and on
the standby power consumption of these devices. However, the nature and properties of
consumer electronic devices and IT devices are rapidly changing.
For example, when the deemed savings from IT SPCs were first being calculated it was
assumed that the home computer would be a desktop PC but now in 2012 the majority of
home computers are laptop devices. This means assumptions about energy usage and the
nature of peripherals, plus potential impacts of an IT SPC, may have become out-dated in
a relatively short period of time.
Another challenge for the field trial methodology is that using small numbers of houses,
20 per trial, in the field trials makes it harder for the field trial sample to be representative
of the broader population. This means behavioural differences in the households in the
trial could significantly influence the trial results, and make it difficult to remove these
influences through the normalisation process used to estimate deemed savings.
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13.2
Review of Market
13.2.1
Market Summary
June 2012
The master-slave SPC has been available in the market for a few years and the more
sophisticated SPC has been distributed in Victoria and South Australia via the VEET and
REES over the last 12 months. The market penetration of master-slave SPCs is expected
to be relatively low, but information on this is not available. The penetration of the more
sophisticated SPCs in Victoria and South Australia will be increasing rapidly, but is likely
to be very low in the other jurisdictions.
As these products can potentially be used in virtually all Australian homes, the potential
market for the products could be over 10 million.
13.3
Recommended
Savings
13.3.1
Activity
Specification
and
Deemed
Description and Specification of Activity
This activity involves the installation of a SPC in a household and the connection to the
SPC of either a television and its peripheral devices, or a home computer and its
peripheral devices. SPCs are divided into audio-visual or IT devices, with the audio- visual
SPC connected to a television and its peripherals, and the IT SPC is connected to a
computer and its peripherals.
It is recommended that any SPC to be used in a NESI meets the following minimum
requirements:

tested by an approved laboratory in accordance with a laboratory test
approved by the ESC, and is determined to be suitable for use in an audio visual or IT environment;

is capable of controlling at least four peripheral devices;

is fitted with a mains power switching device which is rated for a minimum
of 50,000 switching cycles;

consumes 1 W or less; and

for master-slave power controllers, automatically disconnects power from
peripheral devices when the master appliance enters off mode.
Further requirements will need to be specified but it is recommended that this occur once
the present review of the VEET specifications has occurred and the requirements can
then be based around these revised specifications.
Recommendation: That any NESI SPC activity be based on the VEET specifications but
they be reviewed if there are any significant changes to SPC specifications and state standards prior
to implementation.
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13.3.2
June 2012
The Calculations and Deemed Energy Savings
The methodology used to calculate the default deemed energy savings is based on
engineering calculations of the amount of standby power saved by audio-visual or IT
peripherals being switched off, and research on the standby energy consumption of a
range of peripheral devices. The calculations also rely on researched averages and
estimates for households concerning:

how many hours per day the computer or television is used;

how many peripherals are attached to the computer or television;

the nature of typical peripherals and their average active standby, passive
standby and off mode consumption;

the time each peripheral will spend in active, passive and off mode;

the BAU improvement in the standby consumption of peripherals; and

the estimated operating life of the SPC, assumed to be 10 years.
Recommendation: That research be conducted prior to the implementation of this possible
NESI activity, in order to confirm: how many peripherals are attached to installed SPCs in the
market, the nature of typical peripherals and their standby power behaviour and consumption, and
the expected operating life given the proportion of SPCs that remain properly installed.
EnergyConsult calculated the default deemed savings using current information
concerning the averages and estimates listed above. The default savings were determined
by:

for each peripheral, multiplying the power savings in each mode by that
time in each mode;

weighting the results for the household penetration of the devices;

summing the weighted results;

adjusting for estimated number of SPCs per household, which relates back
to IT/TV penetrations;

adjust for MEPS impacts on standby consumption; and

multiply by the operating life of the SPC.
This process was conducted for the audio-visual peripherals, and then all IT peripherals,
using currently available information on penetration, usage and power consumption of
televisions and computers, and their peripherals.
The current deemed energy savings results differ from those underlying the VEET
deemed saving of 1 tonne CO2e per device, as the more recent information was used to
determine the underlying variables, and these variables have changed from when VEET
calculations were undertaken. The assumed lifetime for the IT SPC has also been
lowered to 5 years, rather than 10 years in the VEET, as the rapid movement towards
mobile, wireless enabled IT devices indicates a shorter than previously expected life span.
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The resulting preliminary deemed savings based on current information are provided
below.
Table 31: Preliminary deemed energy saving master-slave SPC
SPC Type
AV
IT
Annual
Saving
(kWh)
129
85
Adjustment
for number
SPC/Home
Adjustment
for MEPS
71%
91%
81%
89%
Lifetime
Saving
(kWh)
10
5
Lifetime
Saving
(kWh)
745
342
It is recommended that optional field trials should continue to be used in a possible NESI
(as they are in the VEET) to determine the energy savings of more sophisticated SPCs,
unless a more effective method of determining the energy savings from sophisticated
SPCs is developed for the VEET. The methodology to be used in the field trials of the
more sophisticated SPCs, as described in the VEET regulations, should be used for a
possible NESI. The field trial results should then be normalised to determine the energy
savings. However, one recommended change to this process should be that the operating
life assumed for IT SPCs should be reduced to five years.
Recommendation: That the fieldwork requirements of any SPC activity in a possible NESI
be based on the VEET field trial methodology and normalisation process, though the operating life
for the IT SPC should be reduced to five years as the rapid movement towards mobile, wireless
enabled IT devices indicates that it is unlikely that an IT SPC will be used for 10 years.
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14 MEPS
and
Performance
Standards
International Energy Saving Schemes
14.1
June 2012
in
Introduction
When deemed energy savings are calculated for the actions undertaken in energy saving
schemes, often the savings calculations refer to performance standards in determining the
extent of energy savings. For example, the deemed savings from installing an appliance
may vary with the energy star rating of the appliance. The deemed energy savings
calculations may also consider the BAU consumption of an appliance and this
consumption may relate to the minimum energy performance standards (MEPS) relevant
to that appliance.
Consequently when developing the deeming methodologies for actions in a possible
NESI, research was conducted on the performance standards used in international energy
saving schemes, and the relevant MEPS. A comparison of international and Australian
national MEPS was also conducted to help determine what are appropriate business as
usual assumptions for a possible NESI. This research and resulting comparisons are
presented in the section below.
14.2
MEPS and State Scheme Action Criteria
The specifications of actions in an energy-saving scheme are important for determining
that the energy saved is additional to that which would occur under the BAU scenario. As
the BAU scenario will involve installing appliances or technology which must at a
minimum meet the relevant MEPS or similar regulatory standards, the specification of
energy-saving actions must also exceed the relevant MEPS or regulatory standards. A
comparison of the specification of actions in the state energy saving schemes with the
Australian MEPS, and other international standards where appropriate, was therefore
conducted.
The following table contains a simple comparison of standards for the different efficiency
actions affecting appliances and equipment. Note that specifications are invariably
complex, and thus the contents of the table have been significantly simplified in order to
easily compare the key attributes of various programs. Only the activities in international
schemes where specification information on the activity was available are shown in the
table. For details of state specifications, please refer to the relevant activity chapter in the
present report. The space conditioning actions are not compared to MEPS as national
standards do not exist for these activities.
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Table 32: Comparison of minimum standards of state scheme activities, Australian MEPS and international schemes
Activity
Water Heater
Upgrade
Natural Gas (5
star)
Electric
Boosted Solar
Electric Heat
Pump
Gas Boosted
Solar
Retrofit solar
to electric
Retrofit solar
to gas
Non-ducted
Space Heaters
Natural Gas
AC (heat
pump)
REES
VEET
NSW
Australian
MEPS
5 star
5 star
NA
NA45
Specified min
number STCs46
generated
Specified min
number STCs
generated
Specified min
number STCs
generated
NA
60% solar
contribution
NA
50% solar
contribution
60% solar
contribution
NA
50% solar
contribution
60% solar
contribution
NA
50% solar
contribution
50% solar
contribution
50% solar
contribution
NA
NA
NA
NA
4 stars
4 stars
NA
NA
Cop >3.5
NA
2 stars but
varies
varies, mainly
3.1
NA
UK EST& CERT
UK ECA
US Energy Star
NZ Energy Star
45
NA indicates that the standard or program was not applicable to the Activity, or the Activity did not exist in that scheme, while a blank cell indicates no information was available.
46
STCs refers to small-scale technology certificates produced under the small-scale renewable energy scheme
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Activity
June 2012
REES
VEET
NSW
Australian
MEPS
3 star
6 stars
NA
approx 2 stars
varies
NA
5 star
NA
approx 2 stars
NA
NA
Cop 3.5
NA
approx 2 stars
varies
NA
EER 14
NA
NA
NA
R1.5
R1.5
NA
R1.0-R1.5
NA
3 star
3 star
NA
3 star several
states
NA
General CFL
AS4847.2,
≥10,000hr,
(dimmable*)
AS4847.2,
≥8000hr,
(dimmable*)
LED downlight
≥500lm,
LCA certified,
≥10,000hr,
CCT,
(dimmable*)
Non-ducted
Air
Conditioners
Unitary or split
system
Ducted
Systems
Ducted Gas
Ducted Heat
Pump
Ducted
Evaporative
Cooling
Upgrade
Ducting
Water
Equipment
Shower Roses
UK EST& CERT
UK ECA
US Energy Star
NZ Energy Star
Lighting
Same CFL
requirements
NA
≥500lm,
≥10,000hr
AS4847.2,
≥6000hr
Very similar to
AS4847.2
-
Min centre
beam candela,
LM ≥70%
@15000hrs,
CRI ≥80,
CCT
-
Broadly similar to
AS4847.2
AS4847.2 but
higher efficacy,
≥8000hr,
2 yr warranty
Efficacy,
LM ≥90%
@6000hrs,
CRI ≥80
Efficacy,
Min centre beam
candela,
LM ≥70%
@25000hrs,
CRI ≥80,
CCT
Same as US
Energy Star
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Activity
REES
VEET
NSW
Australian
MEPS
June 2012
UK EST& CERT
UK ECA
US Energy Star
NZ Energy Star
-
Max passive
standby pwr,
Max on-mode pwr
Max passive
standby pwr,
Max on-mode
pwr
-
-
NA
-
-
NA
Other
Televisions
≥ 5.5 stars,
CEC ≤ 450
≥ 5.5 stars,
CEC ≤ 450
NA
Currently 1
star (4 star
from April
2013)
Pool pumps
≥ 3 stars
≥ 3 stars
NA
-
IHDs
Max passive
standby pwr,
Max on-mode
pwr,
Auto power
off
-
Zigbee enabled,
≤30s intervals,
≥45 days mem,
display cost,
≤0.6W,
≤5% inaccuracy
NA
NA
-
≤6s response
time,
display cost,
≤1W,
≤5%
inaccuracy
≥5 stars
(electric),
Gas powered
NA
NA
-
Standby,
Label ≥ B/C
-
-
NA
NA
NA
Based on
star rating
-
Standby,
Label ≥ AA
-
MEF ≥ of 2.0,
Water Factor ≤6
≥ 3.5 stars
(energy),
≥ stars (water)
-
Std size:
≤ 295 kWh/year
≤ 4.25 gal/cycle,
Compact size:
≤ 222 kWh/year
≤ 3.5 gal/cycle
Std size:
≥ 3.5 stars,
Compact size:
≥ 3 stars
Whitegoods
Clothes Dryer
Clothes
washer
Dishwasher
NA
NA
Based on
star rating
-
Standby,
Label ≥ AA,
Water
consumption
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Activity
REES
VEET
NSW
Fridge/freezer
- single door
≥2 stars
≥2 stars
Fridge/freezer
- two door
≥2.7 stars
Fridge/freezer
- chest freezer
Fridge/freezer
- upright
freezer
Fridge disposal
June 2012
Australian
MEPS
UK EST& CERT
UK ECA
Based on
star rating
Approx 1 star
Label ≥ A+
-
≥2.7 stars
Based on
star rating
Approx 1-3
stars
Label ≥ A+
-
≥3.3 stars
≥3.3 stars
Based on
star rating
Approx 2 stars
Label ≥ A+
-
≥2.5 stars
≥2.5 stars
Based on
star rating
Approx 1-2
stars
Label ≥ A+
-
Pre 1996,
Working order,
Ozone disposal
Pre 1996,
Secondary unit,
>250 litres,
Working order,
Ozone disposal
Pre 1996,
>200 litres,
Ozone
disposal
-
-
-
US Energy Star
≥20% more
efficient than US
MEPS
≥20% more
efficient than US
MEPS
≥10% more
efficient than US
MEPS
≥10% more
efficient than US
MEPS
-
NZ Energy Star
≥2 stars
≥2.1 to 3.3 stars
≥ 3 stars
≥ 1.6 / 2.5 stars
NA
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Some of the main findings of the comparisons are:

direct comparisons between the state energy saving schemes’ activity specifications
and the Australian MEPS are possible for most activities and show that the activity
specifications match or exceed Australian MEPS in all cases; and

direct comparison between the specifications of activities in the state energy saving
schemes and international schemes is not possible for most activities. The
measurement metrics in the different schemes differs too much for the
specifications to be directly compared.
It is worth noting that when Australian appliance MEPS are established, overseas trends
regarding MEPS are considered and are a factor in setting the MEPS levels. Generally the
Australian MEPS are set at levels approaching or comparable to relevant international
MEPS, and in a few cases, such as air-conditioning, Australia has led the world in setting
stringent efficiency requirements. Consequently it can be assumed that if the criteria set
for the actions of the Australian energy savings initiatives match or exceed Australian
MEPS, then these criteria will also approximately match or exceed international MEPS.
14.3
New Zealand Energy Star
The New Zealand EnergyStar program is a product endorsement labelling scheme. This
means products which meet the requirements of the New Zealand scheme can be labelled
as an EnergyStar product, which effectively endorses them as high efficiency product. A
range of residential appliances are included in the program and each appliance has a
different set of minimum performance standards which must be exceeded if the product
is to be allowed to display an EnergyStar label.
In many cases the minimum performance standard for a residential appliance is defined in
terms of its energy star rating index. Many appliances in Australia and New Zealand are
measured with an energy star rating index, and assigned a star rating label accordingly.
These star rating indices are consistent between Australia and New Zealand and based on
common standards. A number of actions in the Australian state energy saving schemes
involve the installation of high-efficiency appliances, and in most cases the measure of the
efficiency is according to the energy star rating index. Consequently, the New Zealand
EnergyStar program often uses similar performance measurement methodology to what is
being used in the Australian energy saving schemes.
The minimum performance standards required for products to be included in the New
Zealand EnergyStar program are described in Table 32.
As the New Zealand EnergyStar program is not an energy saving scheme, it does not use
deemed energy savings methodologies.
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14.4
United Kingdom Energy Savings Trust, CERT and
Capital Allowance Scheme
The Energy Savings Trust was set up in the United Kingdom in 1992 and has operated as
a not-for-profit organisation which providesadvice focused on how to reduce carbon
emissions, use water more sustainably and save money on energy bills. A key part of their
work is the operation of an endorsement labelling scheme which recommends certified
residential products and appliances as energy efficient. Such products are allowed to
display the Energy Saving Trust Recommended label.
The Energy Savings Trust therefore operates much more like the EnergyStar program
than the Australian state-based energy saving schemes. This scheme also does not use
deeming methodologies to calculate energy savings. As has been previously mentioned,
differences in measurement metrics also mean that the specifications used in the Energy
Saving Trust cannot be directly compared to the activity specifications used in the
Australian state energy saving schemes.
United Kingdom Capital Allowance Scheme is also a completely different type of scheme
to the Australian energy savings initiatives. The Capital Allowance Scheme is aimed
purely at businesses to encourage them to invest in energy efficiency, largely through a
more rapid depreciation of capital investments. It is therefore not applicable for this
current report.
The UK CERT (Carbon Emissions Reduction Target) scheme requires all residential
energy suppliers with a customer base in excess of 250,000 customers to make savings in
the amount of CO2 emitted by householders. Suppliers meet this target by promoting the
uptake of low carbon energy solutions to household energy consumers. Measures include
insulation, lighting (now removed from the scheme), boiler replacement, appliances, and
behavioural measures such as IHDs and home energy advice.
The UK CERT uses deemed energy savings for some of its activities and these deemed
savings were based initially on research and calculations, and later these savings were
adjusted after measurement of installed actions. The result of this use of measurement to
improve the accuracy of deemed savings, and the fact that the UK CERT programme is
much bigger than the Australian state programs, has meant that deemed savings can be
allocated to more specifically defined variations of activities than has been done in the
Australian programs. For example, the UK CERT defines the deemed energy savings
from loft insulation for four different thicknesses of insulation and 18 different
combinations of housing types and numbers of stories.
14.5
Energy Efficiency Obligation Programs in the EU
There are a number of energy savings programs, or energy efficiency obligation programs,
that operate in the European Union. Some of the programs that include a residential
component operate in the following countries:
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




June 2012
Belgium
France
Italy
United Kingdom
Denmark.
The residential component of these programs involves a mix of actions which consist of
insulation installations, lighting upgrades, appliance upgrades, heating upgrades and other
actions (Eoin Lees, 2011). The known actions are listed below.
The Italian white certificate scheme generates energy savings from the following
measures:

electric motors;

lighting systems;

reduction of stand-by power;

reduction of electricity consumption in thermal uses;

reduction of air conditioning electricity consumption;

promotion of high efficiency electric appliances in offices and homes;

substitution of electricity to other energy sources with reduction of primary
energy consumption;

heating/cooling and heat recovery in buildings supplied with nonrenewable fuels;

development of renewable energy sources at users’ premises;

promotion of electric and natural gas vehicles; and

campaigns for education, information, and promotion of energy efficiency.
The French scheme includes the following technologies:

installation of heating control mechanisms;

replacement of boilers or water heaters by more efficient equipment or
thermal renewable energy;

replacement of domestic appliances with more efficient equipment;

creation of wood-fired heating systems for district heating or in industry;

fitting of insulating jackets to water heaters;

boiler maintenance;

substitution with low energy light bulbs;

loft insulation; and

double glazing.
The Danish scheme includes the following technologies:
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






June 2012
insulation;
heating;
windows;
heat pumps;
solar heat systems;
solar cells; and
energy efficiency advice.
Detailed (English language) specifications and deeming methods for these measures are
not readily available. It is expected however that appliance specifications and similar will
be based on the EU energy labelling scheme.
It is worth noting the residential energy efficiency activities of these schemes all appear to
be very similar to those currently being used in the Australian state energy saving
schemes.
Unfortunately, as the climates and markets of these countries differ so much from
Australia, it is not possible to usefully compare the criteria they have used for defining
appropriate actions for those relating to water heating, space heating or improving the
thermal properties of buildings. Nor can other Australian actions involving the upgrading
of appliances and lighting be compared, as our regulatory situation regarding MEPS for
such equipment and the average efficiency of equipment in our market will both vary
significantly from the situation in Europe. In addition, details of any deeming
methodologies could not be found.
Despite these difficulties in comparing deeming methodologies used in European energy
saving schemes and the Australian schemes, the research and material available
concerning the calculation of energy savings and greenhouse abatement suggest the
approach used in Australia is consistent with that used internationally.
For example a recent paper on determining energy savings from energy efficiency
obligation schemes (Staniaszek & Lees 2012) listed the following issues to be considered
in defining (deeming) energy savings, along with others concerned with program design:

Baseline issues

in new buildings, only measuring savings above those obtained by
prevailing building codes;

for new equipment, only the difference between the high-efficiency
equipment and the market average should be counted; and

accelerated replacement of equipment, the duration of the energy savings
should only be for the remaining lifetime of the original equipment.

Gross Savings Adjustment

adjust deemed savings for rebound/comfort effects;
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




June 2012
use normalised measurements to calculate deemed savings;
consider fuel switching if activity affects use of more than one energy
source and consider carbon content of fuels;
use realistic lifetimes for activities; and
technical interaction between measures, so the installation of one measure
reduces the future savings from a second measure.
Attribution of Energy Savings

additionality, the need to only count net savings above BAU savings.
All of the issues identified in the Staniaszek & Lees, 2012, paper are issues that have been
considered in developing the deeming methodologies for the Australian state energy
savings schemes and for a possible NESI. This suggests that the underlying deeming
methodologies proposed for a possible NESI will be consistent with international
practice.
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15 Peak Demand Savings, Low Income Households
Savings and Other NESI Design Issues
Potentially a NESI can achieve more than simply reducing energy consumption through
individual efficiency activities, depending its objectives and design. Some issues which
have been considered in the design of existing Australian energy-saving initiatives and
energy efficiency programs include:

reducing electricity peak demand;

encouraging energy efficiency in low income households; and

encouraging deep and/or bundled retrofits of existing building stock.
This report is focused on developing the deeming methodology for residential energy
efficiency actions in a possible NESI, so these topics can only be briefly addressed in this
report, but they are included because they have relevance to potential methods of
determining deemed energy savings and for defining certificates or other units for a
NESI.
15.1
Peak Demand Savings
Reducing peak demand is typically achieved using four different methods:

improving the energy efficiency of electrical equipment (including building
improvements) thereby reducing the power demand of the equipment;

fuel switching (e.g. electricity to gas or solar);

time shifting, i.e. changing the time at which electricity is used (e.g. off
peak pool pump); and

load shedding/cycling.
This study is focused on energy efficiency, and to a lesser extent fuel switching. Some
energy efficiency activities will result in greater peak demand benefits than others, due to
the time at which the equipment in question is typically drawing power, and the quantity
of power.
Electricity system peaks typically occur either on hot summer days (afternoon / early
evening) or cold winter evenings. Table 33 gives an approximate indication of the
potential peak demand benefits of the activities analysed in this study. The table uses a
rating system of “-” meaning no benefits and benefits from “+” to “+++”.
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Table 33: Potential peak demand benefits of activities
Activity
Activity Variation
Summer Peak
Saving
Winter Peak
Saving
Electric to
gas/solar/heatpump
Gas to efficient gas/solar
-
-
-
-
Gas heating to efficient
gas
AC to efficient AC
Electric heating to AC
AC to evaporative cooling
systems
Ductwork
-
-
+
++
+
++
-
+
+
+
+
+++
-
+
+
+
+
+
-
++
++
-
+
+
-
Water Heating Activities
Space Heating and Cooling
Activities
Space Conditioning Activities
Low Flow Showerhead
Lighting Activities
Televisions
Pool Pumps
In-home Displays
Efficient Whitegoods
Fridges and freezers
Dishwasher
Clothes Washer
Clothes dryer
Fridge Disposal
Standby Power Controller
Though some energy efficiency activities can contribute to reducing summer and winter
peak demand, in the more extreme climatic conditions when such peaks generally occur,
the impact of energy efficiency actions may be relatively slight.
For example consider the impact of fuel switching in water heaters. Converting electric
water heaters to gas will reduce the total electrical energy consumed by a network, but
unless the operation of the electric elements in the electric water heaters coincided with
when peak electric demand occurs, converting electric water heaters may not significantly
affect electricity peak demand. For summer peak demand, the coincidence of water
heater operations and peak demand will be low, so converting the electric water heaters
will produce little impact on peak demand.
These examples illustrate that an energy efficiency action will not necessarily lead to a
contribution to electricity peak demand reduction, even if the action does impact on an
energy end-use that occurs at the same time as peak demands, such as air conditioner use.
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If a possible NESI does include an objective of reducing peak demand, then activities
which directly contribute to reducing peak demand should be examined in more detail, i.e.
activities such as fuel switching, time shifting and load shedding/cycling. Quantitative
conclusions regarding the ability of these activities to reduce peak load would require
considerable study.
15.2
Low Income Households
Many of the activities outlined in this study would benefit low income households. Some
of the activities might not be as feasible in rental properties, due to the need to engage
with the landlord and the tenant. Also, apartment buildings would not offer the same
energy saving opportunities from thermal measures as single dwellings would. However,
overall energy efficiency activities remain relevant to low income households.
The two Australian state energy efficiency schemes, VEET and REES, both provide
insight into how a possible NESI could contribute to assisting low income households to
obtain energy savings. In the VEET, the Brotherhood of St Laurence has been offering
home energy audits and retrofits for low income households. The retrofits are used to
create VEET certificates which can be sold to help fund the program. In the REES one
of the mandatory obligations on the ‘obliged parties’, i.e. the energy suppliers, is that they
must undertake a certain number of home energy audits in low income homes. In both
schemes the use of home energy audits serves to help educate households about potential
energy savings actions they may undertake, as well as helping to engage the household in
the scheme and motivate them to undertake energy savings actions.
Analysis of the actions undertaken in the REES shows that the low income households,
compared to other household groups, were more likely to undertake the low-cost, or, to
the household, no cost energy efficiency actions such as installing CFLs or low flow
showerheads(ESCOSA 2011). However, there was still some take-up of more expensive,
actions such as replacing water heaters or installing ceiling insulation, and this would have
been assisted by loans and grants for energy efficiency actions offered by the state and
Federal government. These results suggest that all energy efficiency actions could be
relevant to low income households, but the lower cost actions are the most likely to have
high take-up unless other programs are introduced to overcome the cost barriers of
undertaking more expensive actions.
Research has also been conducted concerning the Kildonan Energy Efficiency Program, a
Uniting Care program aimed at assisting low income households to reduce their financial
hardship, and to improve their comfort, through supplying energy audits and assistance to
reduce their energy consumption and costs (Borrell & Lane, 2009). This research also
showed the importance of the home energy audits and of engaging with the low income
households in order to involve them in the energy efficiency program.
These results suggest that home energy audits and face-to-face engagement with low
income (and indeed other) households may result in greater take-up of energy efficiency
actions. However, energy audits and face-to-face engagement as a standalone activity does
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June 2012
not lead to energy savings, as the households still need to undertake the energy savings
actions to actually produce energy savings. Though assigning a deemed energy saving to
energy audits/engagement is possible, this would result in double counting the energy
savings from the household. This is because the energy savings from the actions the
household undertakes will have already been assigned a deemed energy savings.
However, this does not mean that such energy audits, householder consultation and
facilitation activity is not a worthwhile component of a possible NESI. One way of
including such facilitation activities would be to reward them with NESI certificates, so
under a NESI producing energy savings would not be the only way to be granted of
certificates. This would mean an energy audit could be awarded a NESI certificate, in the
same way that a 1MWh energy saving might be awarded a certificate. However, delinking
energy savings from certificate creation is a program design issue and will need to be
addressed once the broader parameters of a possible NESI are finalised.
15.3
Encouraging Deep and/or Bundled Retrofits of Existing
Building Stock
Many of the European energy efficiency obligation schemes are now moving towards
encouraging deep retrofits of existing building stock. Potentially this could become a goal
of a NESI. The difficulty is if a NESI focuses only on rewarding individual actions for
the energy efficiency savings, then activity providers will focus on the ‘low hanging fruit’,
i.e. the program activities which are easiest to implement and provide the best profits for
the activity providers. The result tends to be that the low cost and high benefit/cost
activities are undertaken first, reducing overall household energy consumption, and hence
reducing the marginal energy savings from activities undertaken later. This effectively
reduces the motivation to undertake additional activities, and hence tends to discourage
the more costly and/or difficult retrofitting of existing building stock.
One way of avoiding this problem is to provide additional rewards for the undertaking of
deep and multiple activities, which exceed the sum of the rewards for the activities
undertaken singularly. Again this involves stepping away from simply having a direct
relationship between NESI certificates or units with deemed energy savings, and
recognising in the program design that other goals for the program exist which may
require more flexibility in the allocation of certificates.
15.4
Program Design and Deeming Methodologies
There are a wide range of program design issues that may affect the calculation of the
deeming methodologies and allocation of NESI certificates. The preceding sections
discussing peak demand, low income households and encouraging deep retrofits illustrate
some of the issues which will impact on deemed savings and certificate allocation. Once
the program design has been finalised, the activity specifications can be developed and the
deemed energy savings calculations refined to ensure consistency with the final activity
specifications.
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16 References
ABS 2008- Australian Bureau of Statistics: Environmental issues – Energy use and
conservation, March 2008 460 2.0.5 5.001, Table 3.11
ABS2011, ABS 4602.0 Environmental Issues: Energy Use and Conservation, Mar 2011,
Australian Bureau of Statistics, Canberra, released Nov 2011
Accenture 2011, IHD Inclusion into ESI scheme, for Victorian Department of Primary
Industries, November 2011
AGO 1999, Australian Residential Building Sector Greenhouse Gas Emissions 19902010, Energy Efficient Strategies, Canberra, July 1999
Beletich 2005, Minimum Energy Performance Standards – Halogen Lighting
Transformers, prepared by Beletich Associates for the National Appliance and
Equipment Energy Efficiency Program, April 2005
Borrell & Lane, 2009, Jennifer Borrell & Sharron Lane “Kildonan UnitingCare Energy
Audit Program Evaluation” January 2009
Digital CEnergy 2009, Regulatory Impact Statement: Proposed Minimum Energy
Performance Standards and Labelling for Televisions, prepared by Digital CEnergy and
issued by the Equipment Energy Efficiency Committee under the auspices of the
Ministerial Council on Energy, May 2009
Eoin Lees, 2011 - “Eoin Lees, Experience of EU Energy EfficiencyObligations – Diverse
but Delivering”, September 2011
EC 2010- EnergyConsult for the Equipment Energy Efficiency Program “EnergyConsult
for the Equipment Energy Efficiency Program: Decision RIS”, December 2010
EC Jan. 2011 - EnergyConsult for the Equipment Energy Efficiency Program “Gas
Ducted Heaters:Product Profile”, January 2011
EC 2011b, Residential Energy Efficiency Scheme Review of Energy Efficiency Activities Phase 3, prepared for Essential Services Commission of South Australia, May 2011
EC 2012 - EnergyConsult for the Equipment Energy Efficiency Program “Product
Profile:Gas Space & Decorative (Fuel Effect) Heaters”, May 2012
EC 2012a - EnergyConsult for the Equipment Energy Efficiency Program “Product
Profile: Electric Storage Water Heaters”, to be released 2012
EC 2012b - EnergyConsult for the Equipment Energy Efficiency Program “Gas
Appliance Energy Efficiency Labelling: Discussion Paper”, April 2012
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National ESI: Preliminary research and development of deeming methodologies
June 2012
EnergyConsult for E3 program - Decision RIS: Minimum Energy Performance Standards for
Air Conditioners: 2011, Dec 2010
EnergyConsult for E3 program - Product Profile: Gas Ducted Heaters, Jan 2012
EES 2010, Energy Efficiency Strategies “Mandatory Disclosure of Energy, Greenhouse
and Water Performance of Residential Dwellings - Review and recommend methodology
for improvement of the “SV Model”; Version 5”, March 2010
EES 2010B, Greening White Goods, A Report into the Energy Efficiency Trends of
Whitegoods in Australia from 1993-2009, Final Report and Detailed Output
Tables prepared for the Equipment Energy Efficiency Committee, prepared by Energy
Efficient Strategies, October 2010
EES 2011, Tracking the Efficiency of Televisions, Report for Department of Climate
Change and Energy Efficiency, Prepared by Energy Efficient Strategies, June 2011
ESCOSA 2011, Presentation at Low Income Household Workshop “Low Income
Aspects of REES”, 15th November, 2011
Seebacher 2009, Presentation by Peter Seebacher to the Swimming Pool Stakeholders
Meeting, 4th August 2009.
Staniaszek & Lees 2012, DanStaniaszek and Eoin Lees, “Determining Energy Savingsfor
Energy Efficiency Obligation Schemes”, RAP Publications, April 2012
www.raponline.org
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17 Glossary
AC - air conditioners, but does not include evaporative coolers
AC RC - reverse cycle air conditioners, capable of supplying heating or cooling service
Comparative energy consumption (CEC) – refers to the energy consumed by an appliance
or piece of equipment being operated in a defined way, usually corresponding to average
usage parameters for the appliance or equipment
Conversion factor - measure of the ratio of energy delivered from system, e.g. heater,
compared to the input energy
COP - Coefficient of performance- a measure of the ratio of the heat output of a heat
pump/air conditioner to the input energy
EER - Energy Efficiency Ratio- a measure of the ratio of the cooling output of an air
conditioner to the input energy
HE – High efficiency
KWh - Kilowatt hours
MJ - Mega joules
SRI - Energy rating of appliances Star Rating Index- As described in the Energyrating
web site, (http://www.energyrating.gov.au/resources/glossary-of-terms/ ) SRI is an
indication of the claimed energy efficiency of an appliance. A higher Star Rating Index
indicates higher energy efficiency. The Star Rating Index is a decimal version of the star
rating.
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18 Appendix:
Schemes
June 2012
Lifetime of Activities in State
Table 34: Lifetime of energy savings activities in state schemes (years)
Category
Num of
Activity
Water
Heating
1
2
VEET
NSW
REES
Electric to gas or boosted solar
hot water
12-15
N/A47
8-12
Solar retrofit on electric hot
water
Gas to gas boosted solar hot
water
Solar pre-heater on gas water
heater
Ducted gas to HE ducted gas
heater
Central electric to HE ducted
gas heater
15
N/A
8-12
15
N/A
8-12
6
N/A
8-12
14
N/A
N/A
14
N/A
N/A
7
Ducted heat pump to HE ducted
heat pump
13
N/A
N/A
8
Central electric to HE ducted
heat pump
13
N/A
N/A
9
10
11
12
Gas flued space heater
Space heat pump
HE ducted gas in new premises
Air con to ducted evaporative
cooler
Gas ductwork replacement
AC ductwork replacement
Ceiling insulation
Underfloor insulation
Window replacement
Window retrofit
Weather sealing
Draft Proofing
Low efficiency rose to HE rose
15
12
15
14
N/A
N/A
N/A
N/A
10
10
N/A
N/A
14
N/A
25
25
25
15
10
10
10
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
20
20
N/A
N/A
N/A
N/A
10
4
8,000 to
20.000
hrs
7
4,000 to
10,000 hrs
10,000
hrs
UK48
4
3
4
Space
Heating &
Cooling
5
6
Activity
Shower Rose
13
14
15
16
17
18
19
20
21
Lighting
22
Low efficiency lighting to HE
lighting
Refrigerator
or Freezer
23
Dispose of pre-1996
fridge/freezer
Space
Conditioning
47
N/A means not applicable.
48
UK –Unknown, due lack of access to underlying deeming calculations.
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National ESI: Preliminary research and development of deeming methodologies
Category
Num of
Activity
Activity
HE fridge/freezer
June 2012
VEET
NSW
REES
17-21
UK
N/A
Television
25
HE television
10
N/A
N/A
Clothes Dryer
26
HE clothes dryer
12
N/A
N/A
Pool Pumps
27
HE pool pump
7
N/A
7
SPCs
28
Standby power controllers
(SPCs)
10
N/A
10
122