Energy Efficiency Improvement Scheme

Electricity retailers in the ACT are regulated under this scheme. It’s designed so electricity retailers help households and businesses to use less energy. Some retailers contribute funds to the ACT Government, which are used to fund energy efficiency initiatives.

About the scheme

Electricity retailers are required to help households and small-to-medium businesses save energy under the Energy Efficiency (Cost of Living) Improvement Act 2012.

The scheme aims to:

  • encourage the efficient use of energy
  • reduce greenhouse gas emissions
  • reduce household and business energy use and costs
  • increase ways for priority households to reduce energy use and costs.

These points are known as the ‘objects’ under the Act.

Energy savings are an important step in the ACT’s commitment to net zero emissions by 2045.

What do electricity retailers have to do?

There are 2 tiers of electricity retailers in the legislation:

  • Tier 1 retailers have at least 5,000 customers in the ACT and sell at least 500,000 MWh of electricity to customers in the ACT within a compliance period (which is a calendar year).
  • Tier 2 captures all other retailers, of which there are currently over 20 operating in the ACT.

Tier 1 retailers

Tier 1 retailers must meet their energy savings obligation under the scheme by delivering eligible energy savings activities to households and small-to-medium businesses. ActewAGL is the only provider currently doing this in the ACT.

There are over 20 eligible activities, including:

  • efficient electric space heating and cooling systems
  • electric hot water heat pumps
  • insulation
  • other items that provide energy savings and reduce energy bills while maintaining quality of life.

Retailers may choose which of the eligible activities they deliver to meet their obligation. They can also get energy savings factors from businesses that can deliver activities on their behalf, called Approved Energy Savings Providers.

Tier 1 retailers must deliver a proportion of their energy savings to priority households as specified by the Priority Household Target (PHT). This target is re-set each year.

Tier 2 retailers

Tier 2 retailers can choose to deliver eligible activities or pay an Energy Savings Contribution (ESC) to the ACT Government. The ESC is spent on initiatives in accordance with the Objects of the Act. Contributions are currently used to fund:

  • the administration of the scheme
  • ACT Government-led energy efficiency programs.

At the moment, all tier 2 retailers are paying the ESC.

What does it mean for households and business?

Tier 1 electricity retailers must deliver eligible energy-saving activities, such as appliance upgrades, to households and small-to-medium businesses. The electricity retailer chooses the activities they deliver to meet their obligation.

They must also deliver a proportion of their total energy savings to priority households, which are those experiencing barriers to accessing energy-efficiency upgrades. Households or businesses can contact their electricity retailer to find out if they are offering energy-efficiency upgrades under the scheme.

Even though some costs associated with energy saving activities may be passed on to consumers via electricity bills, by increasing energy efficiency, we’re reducing overall demand. This reduces the overall cost of electricity, meaning that even households and businesses that do not receive energy-efficiency upgrades under the scheme should benefit from these reductions.

How do electricity retailers meet their obligations?

Electricity retailers operating in the ACT are obligated to achieve energy savings as outlined in the scheme’s legislation.

An Energy Savings Target (EST) is set for each compliance year. Retailers must meet this target, which is a percentage of their total electricity sales in the ACT. There are also other scheme parameters to be met.

Electricity retailers can find more detail about the:

Why it’s important

The scheme is a key part of the ACT Climate Change Strategy. It is one of the most cost-effective and efficient ways the ACT is reducing greenhouse gas emissions and energy bills. It also provides more opportunities for priority households to reduce energy use and costs.

Since 2013, the scheme has:

  • directly helped around 80,000 households and businesses, including more than 21,000 priority households reduce household energy use and costs.
  • contributed to over 4,300 small- and medium-sized businesses receiving commercial LED lighting upgrades, reducing energy use and cost.
  • Over 700,000 tonnes of carbon dioxide equivalent emissions were saved.

The financial contributions from tier 2 retailers help fund the administration of the scheme as well as other ACT Government initiatives to reduce energy use, increase energy efficiency and saving energy costs.

Contact

Energy Efficiency Improvement Scheme
Email: EPD-EEIS@act.gov.au

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Acknowledgement of Country

We acknowledge the Ngunnawal people as traditional custodians of the ACT and recognise any other people or families with connection to the lands of the ACT and region. We acknowledge and respect their continuing culture and the contribution they make to the life of this city and this region.