182 Fullarton Road, Dulwich 5065, Australia

Embertec Pty. Ltd, ABN: 61 110 367 809

Tel: +61 8 8334 3300 web:

11 Nov 2015

Department of Economic Development, Jobs, Transport and Resources

Energy Sector Development Division
GPO Box 4509

Melbourne VIC 3001

Attention: Dr. Sharn Enzinger – Director of Energy Efficiency

Dear Dr. Enzinger,

Re: VEET Proposed Activity Regulations Changes - October 2015 consultation

Embertec welcomes the opportunity to provide comments to the Victorian Government’s Energy Sector Development Division as part of the consultation on ‘VEET Proposed Activity Regulations Changes - October 2015’.

Embertec is a leading developer and manufacturer of energy efficiency and energy productivity technology with sales to Australia, Canada, and the United States. Embertec is proudly an Australian SME and is investing more than $3M annually on research and development. Embertec has extensive experience as a supplier of products for installation under the South Australian REES Scheme, the Capital Territory’s Energy Efficiency Improvement Scheme (EEIS) as well as to businesses accredited under the Victorian Energy Efficiency Target (VEET) scheme.

Embertec recognise that this suite of amendments is the first tranche of changes to the VEET Regulations following the government’s decision to extend VEET to the year 2020. As such the changes proposed are targeting activities that have:

had little uptake to date, and have an obvious barrier to uptake; and
Activities that have undergone significant market or technological change.

Embertec’s detailed responses to the proposed Amendments are included in Attachment A to this letter; however our main recommendations are to:

Include the new schedule 21E as soon as practicable as part of the first set of changes starting from 1 January 2016 as opposed to delaying the start to 1 March 2016; and
Ensure that the Regulations for schedule 21D specifically allows for retrofits of halogen GU10 based products to be replaced with low energy MR16 (21D) lamp and driver products.

Simultaneous to this consultation, the Victorian Government has also initiated consultations for project based methodologies and is accepting a general call for proposals for new and amended activities. Embertec looks forward to continuing the dialog with the Department and the Essential Services Commission (ESC) on VEET matters including providing submissions to the other consultations. Embertec is also prepared to provide appropriate time and resources as requested to support the Department’s continuing efforts to expand and improve the VEET scheme.

Should you have any questions regarding this submission, please contact Kevin McNamara, Manager Intellectual Property and Regulatory at or Henry Otley, Strategic Business Analyst at .

We look forward to continued discussion,

Yours sincerely,

Henry

Attachment A – Embertec responses to VEET regulation amendments

Schedule 21A - Installation of low energy GLS in place of mains voltage GLS

Embertec ask that in addition to making the changes to the abatement factors in 21A it is also appropriate to better align the minimum performance criteria for 21A in a manner consistent with that proposed performance criteria for 21C, D, and E. Specifically, 21A should be updated to accommodate for higher efficacy products by including a new ‘High Efficiency 3’ category and a minimum lifetime option for lamps lifetimes of more than 25,000 hours. Embertec propose that highest lifetime/efficiency lamps should continue to earn an abatement score similar to the current Schedule 21A values. For clarity, we propose a structure for 21A that is similarly fashioned to Table 1.

Table 1 - Revised certificate allocation for Schedule 21A - Installation of low energy GLS in place of mains voltage GLS

Rated Life of Low Energy Lamp (Hrs) / Abatement Factor
Minimum Efficiency / High Efficiency 1 / High Efficiency 2 / High Efficiency 3
15,000 to 20,000 / .37 / .41 / 0.43 / .45
20,000 to <25,000 / 0.50 / .55 / 0.57 / 0.59
25,000+ / 0.63 / 0.69 / 0.71 / 0.73

Schedule 21C – Installation of low energy 12 volt lamp to replace 12 volt halogen

Embertec support the proposed amendments to product specifications (and associated abatement scores) in the 21C schedule. The amendments will not limit household access to the low cost efficiency solutions and will continue to deliver improved product innovation and quality to Victorian households.

Schedule 21D – Installation of mains voltage low energy downlight in place of existing 12 volt halogen downlight

Embertec support the proposed amendments to product specifications (and associated abatement scores) in the 21D schedule however there still remains an opportunity to update the terminology used in this schedule.

Notwithstanding the very welcome introduction of a new category 21E (GU10 replacing GU10), Embertec request that the Department ensure schedule 21D (or possibly 21E) is appropriately amended to explicitly accommodate instances where households may access VEET benefit for the installation 21D type products in place of existing mains voltage (240V) halogen lamp of at least 35 watts with a GU10 base. Embertec’s current reading of the proposed changes to 21D and introduction of 21E does not yet support this type of installation. Table 2 provides a matrix of the different downlight schedule options households have in VEET.

Table 2 – Matrix of options to replace halogen downlights in VEET

Install – low energy downlight
Remove / GU10 - LED / MR16 LED (plug and play) / MR16 with Driver (removing transformer)
MR16 (halogen lamp) / 21D activity / 21C activity / 21D activity
GU10 (halogen lamp) / 21E activity / Not technically possible / No option – appears to be a gap in Regulations

The cell highlighted with the red circle in the bottom right corner is the situation that it does not appear is sufficiently allowed for under the existing Regulations or proposed amendments.

From a business impacts perspective covering the gap in the Regulations will remove unnecessary costs and frustrations. Our experience is that approximately 1 in 10 households have existing GU10 halogen downlights for which there are currently no options lighting replacements in VEET. While 21E is a most welcome and viable option for GU10 customers, the fact remains that most customers still will not know how to identify if they have GU10 lamps or not. The gap keeps in place a risk to existing APs that customers who seek certain 21D products (such as lamps/driver combinations and dimmers) may not be able to claim VEECs for the installation. Replacing a halogen GU10 lamp with a new LED MR16 (with driver) is an option that VEET should be supporting but does not. Neither APs nor electricians working on site should be put in a situation where they have to explain to households that their preferred option is not allowed because of a technicality.

Embertec request that the drafting of the 21D schedule be amended to include replacement of halogen downlights which operate directly from a 240V supply (GU10) in addition to replacement of 12 Volt halogens (MR16 with transformer).

Schedule 21E – Installation of mains voltage low energy downlight with GU10 base in place of existing halogen downlight with GU10 base

The proposed amendment to the Regulations to include a new schedule 21E is welcome and arguably overdue. The only suggestion Embertec has to improve the proposed amendments is to reconsider the proposed timing for introducing 21E through new Regulation. Embertec strongly recommend the Department ensure the changes take effect from 1 January 2016 alongside the current suite of amendments planned to Schedules 7, 8, 9, 10, 31, 32, 33 and 34 for the same date. We are not aware of any issue with stock availability and already there is an existing set of GU10 products approved under schedule 21D that would meet the product specification for a schedule 21E installation. Businesses are ready now to deliver low energy GU10 products.

The Department should not delay the introduction for an additional three months. Doing so will only act to continue to deny the opportunity to the 10% of Victorian households with GU10 halogen lamps wanting to replace them with GU10 LED lamps in the VEET scheme. Delay will also act to maintain the undesired delivery risks, costs, and frustrations incurred by APs and electricians.

Schedule 34 - Commercial lighting

The proposed changes to this activity – specifically the ability to apply variable hours of use to differing building operating times is a welcome change that we believe will make lighting retrofits in non-residential premises much more viable in VEET.

Embertec ask that the Department carefully consider the practicalities for both APs and businesses to confidently and systematically use Part A3 of the Building Code of Australia (BCA) as the basis for identifying different building types and establishing annual operating hours for lighting retrofits. At a high level it appears that Victoria is adopting the NSW approach to building classifications. Feedback we have received from companies operating in NSW indicates that it is never a straightforward process to use the BCA classification and has led to a number of non-desirable outcomes.

Embertec request that the Regulations provide a level of discretion/authority to the Essential Services Commission (ESC) to make an independent assessment of building spaces and operating hours. Allowing the ESC the ability to make independent decisions outside the scope of the Part A3 of the BCA will support better outcomes and improve the administration of the this activity schedule.

Concluding remarks

Embertec thanks the Department for the continued high level of engagement with VEET scheme stakeholders. The proposed amendments are welcome developments however as we have highlighted in our submission there is still opportunity to improve. Most urgent is the need to bring forward the proposed start date for 21E and to fully account for different retrofit options for households with GU10 halogen downlights.

The VEET scheme is ‘World Class’ when it comes to driving energy change and in supporting new and emerging energy products and services. It is a program that Embertec will continue to invest in and one that we look forward to remaining involved with as the scheme continues to mature.