NSW energy efficiency & savings scheme

by Energy Action | Oct 12, 2015
A review of the NSW Energy Savings Scheme has been under way by the NSW Government since November 2014 with an Options Paper issued earlier in 2015, and a subsequent Final Statutory Review Report.

A review of the NSW Energy Savings Scheme has been underway by the NSW Government since November 2014 with an Options Paper issued earlier in 2015, and a subsequent Final Statutory Review Report.

The Energy Savings Scheme (ESS) commenced operation on 1 July 2009.

The equivalent scheme in Victoria – the Victoria Energy Efficient Target (VEET) scheme – commenced operation on 1 January 2009.

The South Australian government recently established the Retailer Energy Efficiency Scheme (REES) which replaced the Residential Energy Efficiency Scheme. The REES commenced on 1 January 2015. The Residential Energy Efficiency Scheme ceased operation in 2014.

The ESS Options Paper and later Statutory Review Report recommended to a) extending the ESS to 2025, b) introducing a regional network factor and c) expanding the ESS to include gas and to support gas efficiency.    

Earlier this year, a report compared the ESS and VEET, and stated that the notable difference was that the VEET covers activities in the gas and electricity sector, where the ESS only focuses on the latter. Given the recent release of the Statutory Review Report, the ESS is now proposed to cover activities in the gas sector as well.

A number of investigations into the establishment of a national energy efficiency scheme have been carried out over the last few years. Generally these reports indicated a national scheme may be preferable to State-based schemes for the following reasons:

1. A larger market provides for greater liquidity and lower, more stable prices,
2. A
larger market allows economies of scale to reduce costs of energy efficiency,
3. C
onsistent administration reduces costs for businesses involved in schemes in more than one jurisdiction,
4. S
ome of the infrastructure savings of the state schemes are already spread across other National Electricity Market jurisdictions.

However, given the lack of progress in establishing a national scheme, the NSW government has committed to continue to work with other jurisdictions to harmonise the State-based energy efficiency trading schemes.

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