EECCA calls on Victorian Energy Minister to support VEET

The Victorian Minister for Energy and Resources, Russell Northe, was this week sworn into his new portfolio. One of his first tasks will be the consideration of the government’s review of the Victorian Energy Efficiency Target (VEET) scheme - a scheme supported by the Energy Efficiency Certificate Creators Association (EECCA).

EECCA President Bruce Easton said the association calls on the minister to “release [the government’s] report on the scheme review and to work with the sector in ensuring a continuation of a scheme that has contributed to Victoria’s economy”. He added that the association recently came across an article in the Herald Sun, which suggested “the government may be considering abolishing the scheme due to cost-of-living pressures”.

“The article relates to a secret report stating the scheme has cost consumers $177m and that these costs may increase to $700m by 2030,” said Easton. “The report being secret is a concern as it is difficult to challenge, but these are strange statistics and at odds with other modelling. Economic analysis undertaken for the National Energy Efficiency Initiative released in 2013 shows there were $2.2 billion of net economic benefits from a national energy efficiency scheme representing a significant $500m of economic benefits for Victoria.”

Easton said the suggestion that ‘green schemes’ such as the VEET inflate energy prices is incorrect. “On the contrary,” he said, “VEET puts downward pressure on power prices as it reduces electricity demand. This is supported by AEMC data that shows not only is consumption reduced directly as a result of these schemes, but the pass-on cost to consumers is only 0.26 cents per kWh, outweighed by the lower wholesale cost of electricity.

“According to EECCA calculations, VEET has achieved a saving of $550m in households and SME businesses’ energy bills in 2013 through the installation of energy-efficiency products. The scheme has delivered multiple benefits at a minimal cost … It has assisted households and businesses to receive discounted energy-efficiency appliances and helped reduce their energy bills. In turn, this has reduced electricity demand.”

The Clean Energy Council (CEC) has also come out in support of the scheme. CEC Chief Executive David Green said VEET is one of only a few public programs that helps households save on their power bill, delivering an average benefit of $308 over the first five years of the program for those in the scheme.

“VEET reduces the up-front costs of investing in energy-efficiency products, which is particularly important for low-income households who are struggling with their bills,” he said.

The VEET scheme has reduced energy costs for approximately 1.3 million households and businesses. It is also said to support thousands of jobs in Victoria’s economy, from businesses that install energy-efficient products or provide consulting services to manufacturers and suppliers.

Green said the ‘secret’ modelling released to the media should be fully released for public scrutiny. He noted, “Previous studies of the scheme show that the target is working well at a low cost and provides a net public benefit, both in terms of household savings and the economic activity it creates. I am confident that any objective study will show the same thing.”