Terms of Reference for the
Review of the Intergovernmental Agreement for the
Greenhouse and Energy Minimum Standards (GEMS)
Legislative Scheme (the IGA)

Introduction

On behalf of the Equipment Energy Efficiency (E3) Program, the Commonwealth Department of Industry is initiating a review process that will:

  • review and evaluate the operation of the national administrative framework for the IGA and recommend, as appropriate, any changes in the context of the Government’s commitment to reduce the regulatory burden on industry while continuing to help reduce energy consumption and associated energy costs and greenhouse gas emissions of Australian households and businesses;
  • assess the implementation of the E3Program against its objectives, and the operation of the IGA; and
  • consider ongoing funding contributions by Commonwealth, State and Territory Governments based on experience during the first two years of the GEMS Act, and options for the long term funding arrangements of the Program beyond financial year
    2015-16, including in relation to cost recovery.

The review will fulfil the requirement in paragraph 51 of the IGAthat it be reviewed, and will generate content that will be of use for the review required under the GEMS Act (to be undertaken after its fifth year of operation).

Scope

An Independent Reviewer will deliver a report which evaluates the operation and administration of the IGA, including transitional issues from the previous multi-jurisdiction appliance and equipment energy efficiency regulatory regime. The report will review the ongoing funding requirements for delivery of the E3 Program, including options relating to cost recovery.

The report will provide an evaluation of:

  • the IGA in delivering a nationally-harmonised appliance and equipment energy efficiency regulatory regime operating in the trans-Tasman market in an efficient and cost-effective manner. What has been the experience in relation to the arrangements and processes for developing new and revised GEMS requirements? Has the IGA led to improvements and cost savings in relation to the previous multi-jurisdiction regime?
  • The efficiency of the implementation of the Program, including making recommendations on opportunities for red-tape reduction and streamlining.
  • The transition from the previous multiple jurisdiction appliance and equipment energy efficiency regulatory regime, including costs and impacts on stakeholders. For example, the GEMS Regulator uses selected state-based technical experts (under a Service Provider contract) to provide an application assessment service. Has this system worked? Is it the most effective way of delivering this service? Are there other options?
  • The implementation of key changes to the E3 Program that occurred as part of the move to the IGA. Has IGA led to better processes and procedures, for example in the inspection and enforcement of mandatory minimum energy performance standards (MEPS) and labelling claims, compliance with registration requirements, and compliance with mandatory labelling requirements at the retail level?
  • Is there an adequate level of awareness of GEMS Determinations and general standard and labelling requirements amongst industry, including small niche manufacturers?
  • Do new procedures facilitate better post-implementation evaluation of the impacts of equipment efficiency regulations?

The report will also identify barriers or complications to the delivery of a national appliance and equipment energy efficiency regulatory scheme.

The report will identify any barriers to the IGA fulfilling its objectives and make recommendations, as appropriate, to overcome these barriers. This will include reviewing the budget approval process under the IGA, as well as decision making processes relating to the approval of any new regulations.

With regard to funding requirements for the broader E3 Program, the report is expected to identify and review different funding models, including status quo arrangements and a number of scenarios with different levels of cost recovery. This review should take into account any likely impacts of different funding models on the effectiveness of the scheme, including the financial impact on industry stakeholders as well as their on-going support of the Program.

The project will involve a Request for Tender for an independent, appropriately qualified and experienced reviewer to undertake the review and evaluation.

The Independent Reviewer will consult appropriately with major stakeholder representatives and will deliver both a draft and final report.

Governance

The Department of Industry will manage the review on behalf of the E3 Committee. The E3 Committee, in consultation with the E3 Review Committee (industry stakeholders) will provide comment on the scope and terms of reference for the review, and will be consulted on the progress with the review. The E3 Committee and E3 Review Committee will be provided a copy of the draft review for comment. The review and any recommendations will be finalised by the Department of Industry, in consultation with the E3 Committee, and provided to Ministers (from jurisdictions which have signed the IGA, and New Zealand) for approval[1] and public release.

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[1] New Zealand Ministerial approval will only be required for any recommendations which impact on the operation and implementation of the E3 Program, to which New Zealand is a partner under the Australia-New Zealand Policy Framework and Funding Arrangement (for the Equipment Energy Efficiency Program).