The Essential Services Commission (ESC) administers the Victorian Energy Efficiency Target Act 2007 (the Act) and the Victorian Energy Efficiency Target Regulations 2008 (the Regulations). The Act and Regulations are made by the Department of Environment, Land, Water and Planning (formerly the Department of Economic Development, Jobs, Transport and Resources).
The ESC has also developed the Victorian Energy Efficiency Target Guidelines (the Guidelines) to facilitate participation in the VEET scheme.
The Victorian Energy Efficiency Target Act 2007, assented to on 11 December 2007, establishes the VEET scheme. The scheme involves the creation, transfer and surrender of Victorian energy efficiency certificates (VEECs) to meet the legislative objectives of:
- reducing greenhouse gas emissions;
- encouraging the efficient use of electricity and gas; and,
- encouraging investment, employment and technology development in industries that supply goods and services which reduce the use of electricity and gas by consumers.
The Act commenced on 1 January 2009 and provides for the scheme to operate in three-year phases to the end of 2029. The Act also confers responsibilities and powers on the ESC to administer the VEET scheme.
- January 2012 - the Act was amended to clarify Accredited Person's obligations and better enable the ESC to monitor and enforce compliance. These amendments commenced 1 January 2012.
- July 2013 - the Act was amended to update the definition of Relevant Entity and other matters. These amendments commenced 10 July 2013.
- July 2014 - the Act was amended to include the definition of police officer and other matters. These amendments commenced 1 July 2014.
- January 2016 - the Act was amended to specify the scheme target for the years 2016-2020, to provide for the Regulations to set the scheme targets in two periods for the years 2021-2025 and 2026-2029, and other matters. These amendments commenced 1 January 2016.
The Act is supported by the Victorian Energy Efficiency Target Regulations 2008. The Regulations commenced on 1 January 2009. Among other matters, the Regulations set out the prescribed activities for the scheme.
In addition, the Regulations specify the level of greenhouse gas abatement attributed to each prescribed activity, as well as the applicable shortfall penalty rate should a Relevant Entity fail to surrender sufficient VEECs to meet their liability under the Act.
- May 2011 - the Regulations were amended to double the scheme target to 5.4 million tonnes of greenhouse gas abated per year (equivalent to 5.4m VEECs per year) for the 2012-14 second phase of the scheme, starting on 1 January 2012.
- December 2011 - the Regulations were amended to allow certain existing prescribed activities to be undertaken in business and other non-residential premises.
- January 2012 - the Regulations were amended to vary the definition of scheme acquisition, in the context of the scheme expansion.
- February 2012 - the Regulations were amended to allow additional existing prescribed activities to be undertaken in business and non-residential premises (following a similar amendment in December 2011).
- March 2012 - the Regulations were amended to provide for the new activity of installing in-home displays (IHDs) in the residential sector.
- May 2012 - the Regulations were amended to allow for four new prescribed activity categories exclusive to the business and non-residential sector. These activities are refrigerated display cabinets, refrigeration fans, high efficiency motors and commercial lighting upgrades.
- July 2012 - the Regulations were amended to alter the manner in which scheme acquisition is calculated for Relevant Entities (EREP sites removed).
- March 2013 - the Regulations were amended to allow for two new prescribed activity categories exclusive to the business and non-residential sector. These are efficient low flow trigger nozzles and water efficient prerinse spray valves. Schedule 20 was also amended to allow for installations into premises where no other heating or cooling products are installed.
- April 2013 - the Regulations were amended to introduce new standards for solar hot water products.
- July 2013 - the Regulations were amended to prepare for the potential introduction of project based assessment methodologies under the VEET scheme.
- July 2014 - The Regulations were amended to modify the way that the consumer price index is referenced; and the conditions and circumstances under which a certificate cannot be created and the class of customers that are prescribed in accordance with the Environmental Protection and Sustainability Victoria Amendment Act 2014 (EREP exclusion).
- January 2016 - the Regulations were amended to remove the requirement that the premises be in a non-gas reticulated area for Schedules 7, 8 and 10; to remove the requirement to decommission for Schedules 31, 32 and 33; and to remove the Building Code classification requirement for Schedule 34. Major changes were made to Schedule 34 including the addition of tables listing annual operating hours and requirements set by the ESC. Adjustments were made to the abatement factors of Schedules 7, 8, 9, 10, 31, 32, 33 and 34, as well as other smaller amendments to each of these schedules.
- February 2016 - The Regulations were amended to include a new Schedule item, 21E.
- March 2016 - The Regulations were amended for Schedule 21A, 21B, 21C and 21D to include changes to LED lamp product approval requirements, increased minimum specification criteria, abatement factors, and higher efficacy and rated lifetime categories.
- April 2016 - the Regulations were amended to include a new Schedule item, 21F. They were also amended for Schedule 11 to include changes to the installation standard and product approval requirements.
- January 2017 - the Regulations were amended for Schedule 24 to include changes to abatement calculations and increased minimum specification criteria for high efficiency televisions.
The Act empowers the ESC to make guidelines about any matter required. The Victorian Energy Efficiency Target Guidelines were originally published in the Victorian Government Gazette on 4 December 2008, and took effect on 1 January 2009. The current version was published in the Victorian Government Gazette on 9 June 2016 and took effect on that day.
Review of the VEET Act
The Act required a review of the Act be completed by 31 December 2011. The review was conducted by a person independent of the Government and assessed the extent to which the objects of the Act have been achieved, the VEET scheme targets and the level of penalties under the Act.
GST exemption for scheme fees under VEET
Persons who deal in instruments under this scheme should seek their own legal advice on their tax obligations.