In October and November 2015, the Department of Economic Development, Jobs, Transport and Resources invited stakeholder submissions on Project Based Activitiesin the VEET scheme.
Victorian Energy Efficiency Target (VEET) scheme
Response to submissions to the 2015 consultationon Project Based Activities 1 of 3
The VEET scheme
The Victorian Energy Efficiency Target (VEET) scheme is a market-based scheme that incentivises energy efficiency upgrades, reduces greenhouse gas emissions, encourages investment and jobs and develops technology in Victoria.
Consultation process
The Department of Economic Development, Jobs, Transport and Resources (the department) consulted on the proposed introduction of Project Based Activitiesinto the VEET scheme in October and November 2015. A discussion paper was released and a public forum was held to present the paper and invite questions.
The paper outlined the proposed approach and posed a number of questions, most of which focused on the Measurement and Verification (M&V) method.
Submissions were received from 22 stakeholders. Of these, the non-confidential submissions have been published on the department’s website.
This document summarises the issues raised in this consultation and outlines (in bolded text) how this has informed the draft regulation amendment for the M&V method. The draft amendment and accompanying consultation document are provided separately.
The M&V method
General feedback
Stakeholders expressed wide support for the introduction of a robust M&V method into the VEET scheme and envisagedsignificant opportunities to improve energy efficiency in Victorian businesses using the method.
Most supported the inclusion of a forward certificate creation option. Some stakeholders also supported the inclusion of multi-site sampling in the method.
The proposed M&V method uses robust, industry standard M&V principles. The method includes the option to forward-create certificates. Multi-site sampling will be considered for later inclusion.
Eligibility
Stakeholders stated that there should be no restrictions on the types of eligible technology and that there should be no requirement for new equipment to be more energy efficient than the market average. Stakeholders also stated that there should be no requirement to decommission replaced equipment.
The method has been designed to be flexible and technology-neutral. Product and decommissioning requirements are limited to those required for consistency with other VEET activities.
Factors affecting the business case
Submissions emphasised the need to strike a balance between administrative burden and incentives and noted that smaller-scale projects may be better served by simpler methods.
Other factors identified included certainty of eligibility and certificate creation and minimising the cost of compliance.
The method has been drafted to put the onus on Accredited Persons (APs) to manage any administrative burden to suit their experience and circumstances. This has been achieved by making timings and requirements less prescriptive.
The department recognises that M&V may be too onerous for smaller projects and is investigating other new methods for businesses.
Project milestones
Stakeholders expressed varying views regarding the information required at different points in the process of applying to create certificates.
- Many supported an early eligibility step with low information requirements.
- Some stakeholders preferred greater project certainty at an earlier stage, while others preferred to shift the information burden to later in the project cycle.
- Generally, stakeholders supported fewer administrative milestones in order to reduce costs.
As noted above, the method has been drafted to put the onus on APs to manage any administrative burden to suit their circumstances and level of experience with M&V.
M&V plans
Stakeholders supported the M&V plan contents proposed in the discussion paper, with the exception that they did not think that an inventory of equipment should be required. In addition, stakeholders stated that it should be allowable to revise the M&V plan at a later point in time. Stakeholders also requested that a template be provided to help prepare the M&V plan.
The proposed project plan requirements are intended to provide flexibility and to allow the Essential Services Commission (ESC) to effectively manage compliance.
Other Project Based Activities methods
Other Project Based Activities methods proposed included a method for commercial building upgrades and a method similar to the NSW Aggregated Metered Baseline method.
Stakeholders were supportive of these methods being introduced, and also made suggestions for other, simplified M&V methods.
The department is now consulting on proposed new methods for large groups of small energy users (the Treatment and Control method) and commercial buildings (the Benchmark Rating method).
The program to strengthen the VEET scheme will include consideration of other new methods for businesses.
For information about this consultation please see our website:
Scheme alignment
One of the department’s guiding principles for method development was aligning with other similar schemes where possible. Stakeholders strongly supported alignment of this kind and noted that it may increase uptake if VEET methods were aligned with the equivalent method from the NSW Energy Savings Scheme (ESS).
Some stakeholders suggested that the M&V method should incorporate minor differences from the NSW Project Impact Assessment with Measurement and Verification (PIAM&V) method but that relevant government agencies in Victoria and NSW should work together to incorporate respective method improvements.
The department works closely with other jurisdictions to ensure consistency with other schemes, where possible.
There are some minor differences between the M&V method and the recently updated PIAM&V method from the NSW scheme. This is documented in the consultation document for the M&V method. This can be found on our website:
Large business exclusion
Large energy consumers listed on the Environment and Resource Efficiency Plans (EREP) register currently cannot generate VEET certificates and their energy use does not count towards energy retailer VEET obligations. Many stakeholders suggested that these premises should be able to generate certificates and that this would increase uptake of the M&V method.
Project Based Activities methods are essential for large energy users to participate in the VEET scheme. The department is consulting on options for large energy users to access incentives. For information about this consultation please see our website:
Skills and training
Many stakeholders expressed the view that there is a general need to develop industry skills in the field of M&V. This could be achieved by providing training, case studies and templates for use with the method.
The department will develop a strategy for building capacity for Victorian industry to undertake M&V.
Other feedback
The following summarised feedback is applicable to the administration of the VEET scheme only. The department has provided the ESC with this feedback for consideration in devising guidelines and compliance requirements.
Competency – AccreditedPersons (APs)
Many stakeholders agreed that the person carrying out technical M&V tasks must be able to demonstrate technical competency. Stakeholders felt that Certified Measurement and Verification Professional (CMVP) accreditation was appropriate, as was Certified Energy Efficiency Specialist/Leader (CEES/CEEL) for projects involving commercial buildings. Relevant experience should also be considered. The competent person could be a member of staff of the APor a contractor.
Competency – third party assessors
Stakeholders agreed that third party assessors of M&V projects should be CMVP accredited and that sector-specific experience should also be considered. Competency requirements for assessors could be upgraded as the industry develops.
Stakeholders had mixed views regarding whether APs should be able to be assessors and whether APs should be able to select their assessor. There was some support for the system used in the NSW Energy Savings Scheme (ESS) and general support for disclosure of potential conflicts of interest.
Compliance and evidence
Stakeholders agreed that the requirements for evidence of installation and commissioning should be tailored to the project. A range of evidence was suggested, including commissioning reports, receipts and signed declarations.
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Victorian Energy Efficiency Target (VEET) scheme
Response to submissions to the 2015 consultationon Project Based Activities 1 of 3