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Energy Policy

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MEFL responds to relevant inquiries and consultation processes and also does more proactive research and advocacy.

Energy policy is now on MEFL's advocacy blog:

>> mefladvocacy.blogspot.com

Topics covered in the blog include:
* Building standards
* Carbon offsets
* CPRS
* Feed-in tariffs
* Renewable Energy Target
* Victorian Climate Change Green Paper
* Victorian Energy Efficiency Target (VEET)
* Voluntary action

The most recent advocacy projects are:

  • MEFL's campaign to recognise voluntary action and GreenPower
  • The case for continued voluntary individual action to reduce emissions
  • National Carbon Offset Standard Discussion Paper
  • Renewable Energy Target
  • Claiming VEET Rebates

    • MEFL's campaign to recognise voluntary action and GreenPower
    MEFL has joined with a number of other community organisations - the Total Environment Centre, CHOICE, WWF Australia, the Australian Conservation Foundation, the Alternative Technology Association, and Environment Victoria - in a campaign to fix a serious flaw in the federal government's Carbon Pollution Reduction Scheme.

    Specifically, MEFL has concerns with the failure of the proposed scheme to recognise the additional action undertaken by individuals to reduce the nation's emissions.

    Under the proposed Carbon Pollution Reduction Scheme (CPRS) voluntary actions merely count towards the required targets, subsidising the big polluters' activities and limiting our national climate change efforts. The joint campaign calls for the voluntary actions that individuals, organisations, state and local governments choose to make to reduce carbon emissions be counted as additional to government-mandated caps.

    A series of letters have been sent to the Prime minister, Climate Change Minister and a range of senior ministers with a relevant role in the CPRS legislation, highlighting the issue and bringing their attention to a Joint Statement and Briefing Paper put together by the coalition of organisations (see below). In addition, a concerted media campaign will be launched in the lead up to the legislation being debated in Federal Parliament.

    For a full understanding of the issue and an outline of a proposed solution, download the Briefing Paper

    To understand the position of the coalition of community groups, read the Joint Statement
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    The case for continued voluntary individual action to reduce emissions
    Concerns around the real impact individuals can make by acting to reduce their greenhouse pollution have been getting a lot of attention recently in light of the proposed Carbon Pollution Reduction Scheme (CPRS).

    Specifically, there has been a strong focus in the media because, under the current CPRS proposal, once the Government sets an emissions target, individuals undertaking voluntary action such as installing solar power, reducing their energy consumption and buying GreenPower will have no impact on the nation's overall emissions, as it simply frees up permits for other polluters to use. As a result, the same amount of gas will be going into the atmosphere and therefore there will be no net reduction in greenhouse pollution. Whilst this may be partially correct, it is only one aspect of the picture.

    It is important to note that the proposed CPRS is just that - still only a proposal. At this stage any voluntary emissions abatement activity remains in addition to government requirements or renewable energy targets, so it definitely does make a difference. In addition, there is a lot of pressure on the government to modify the scheme to take these things into account and to allow voluntary action to be measured and recognised by reducing the number of permits available. If these changes to the scheme are adopted, any voluntary abatement activity will remain additional and continue to have an environmental benefit.

    Further, if the scheme doesn't pass through parliament, which looks increasingly likely given the level of opposition from the Coalition, Greens and minor parties, then things will remain the same as they are now and individual action will again continue to lead to environmental benefits through reduced greenhouse emissions.

    In the unlikely scenario that the scheme does pass through parliament unchanged, further changes may well happen down the track to ensure this additional action is recognised.

    Finally, even if nothing changes, although it may appear that you are just making it cheaper for polluters by freeing up permits, ultimately this is also making it cheaper for you and me, as whatever carbon costs the large industries pay ultimately flow on to consumers.

    Also, activity which reduces demand on electricity or other dirty forms of energy, or moves you towards cleaner forms of energy, will ultimately help insulate you against future inevitable energy price increases, just as insulation and similar measures will make you more comfortable in an increasingly unpredictable and extreme climate.

    In summary, MEFL recommends that individuals continue to undertake actions which reduce their own greenhouse emissions in order to benefit the environment, help adapt to a changing climate and increasing energy prices, and also to send a clear message to the government that there is a willingness and capacity on the community level to address climate change.
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    National Carbon Offset Standard Discussion Paper
    In December 2008 the Department of Climate Change released the National Carbon Offset Standard Discussion Paper. The paper proposes the development of a national Standard to regulate carbon offsets under the coming emissions trading scheme, the Carbon Pollution Reduction Scheme (CPRS), which is set to be implemented from mid-2010.

    Importantly, the paper acknowledges that, in a changed environment under a CPRS, the Government's targets will determine Australia's greenhouse gas emissions. As a result, additional action by individuals, councils and businesses - such as buying GreenPower, installing solar or reducing energy consumption through energy efficiency - will no longer have an impact on the nation's overall emissions. This has big implications for individuals' voluntary action to 'make a difference', not to mention claims of carbon neutrality by businesses and councils.

    A simple measure requiring the government to surrender an emissions permit for every tonne of verifiable emission reduction undertaken by individuals, communities, local governments and businesses, would overcome this problem and enable individuals and communities to remain engaged in action on climate change.

    MEFL has been active in proposing changes to the design of the Carbon Pollution Reduction Scheme to provide recognition of the additional action by individuals, attending the Department's Public Information Session in Melbourne on the 4th of February, and has provided a submission in response to the Discussion Paper. Click here to view.

    More information on the implications of the National Carbon Offset Standard proposal is available on both the Voluntary Carbon Markets Association (http://www.vcma.org.au/) and the Australia Institute (www.tai.org.au).
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    Renewable Energy Target
    In mid-2008 the Federal Government announced an expansion of the national Renewable Energy Target (RET) to 20% of Australia's electricity consumption by the year 2020. Following a consultation process, draft legislation was released at the end of 2008 which will bring the new RET into effect.

    Whilst MEFL welcomes the increased target for renewable, there are some concerns about the decision to introduce a 'solar multiplier' for small-scale renewable such as roof-top grid-connected solar electricity.

    Under the proposal announced by Peter Garrett and Penny Wong in a press release on the 17th of December, the current $8000 rebate for solar panels will be replaced by the 'solar multiplier' which effectively offers residents five Renewable Energy Certificates (RECs) for every megawatt-hour of clean energy their system produces, instead of the usual one REC per megawatt-hour.

    Whilst on the surface this may seem like a generous offer, in effect it means that individuals taking up this offer will effectively be diluting the amount of renewable energy generated under the national target, as there will be four RECs available in the market which won't represent any actual generation.

    As RECs are the trading currency for renewable energy under the Renewable Energy Target, having RECs being created which don't represent actual generation means that electricity retailers will be able to fulfil their obligation by surrendering these 'phantom' RECs but no clean renewable electricity will have been generated.

    To read more on RECs, download this pdf.

    The implications of selling or surrendering your RECs are explained in an excellent article from ReNew magazine, Don't wreck those RECs by Brad Shone.

    MEFL provided a submission on the Exposure Draft of the legislation which will enact the new renewable energy target and the 'solar multiplier'. The submission can be downloaded here.

    Additionally, MEFL joined a number of other concerned organisations to issue a Joint Statement opposing the solar multiplier. The Statement can be downloaded here.
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    Claiming VEET rebates
    The Victorian Energy Efficiency Target (VEET) Scheme is a State Government program designed to help reduce greenhouse gas emissions from households in Victoria by 10% by 2010.

    Under the Scheme, all electricity and gas retailers are required to purchase and then surrender a set number of Victorian Energy Efficiency Certificates (VEECs) each year, or pay a fine. One certificate represents approximately one tonne of greenhouse gas abated.

    The VEET scheme has a list of prescribed activities such as installing an energy efficient appliance, solar hot water system or ceiling insulation. Each time a prescribed activity is undertaken a certain number of Victorian Energy Efficiency Certificates (VEECs) are created. For example, replacing an electric hot water system with an electric boosted solar hot water system is worth approximately 50 VEECs.

    Typically, the customer would sign over or 'sell' their VEECs to either the appliance retailer or solar hot water or insulation installer in exchange for an up front discount on the purchase price of the product. The retailer or installer recovers this money by selling the VEECs to an energy retailer who uses them to meet their obligation to surrender a prescribed number of certificates at the end of the year, and thus avoid being fined.

    Selling VEECs
    It is possible to increase the environmental benefit of your purchase or installation by retaining the eligibile VEECs. Each VEEC represents 1 tonne of greenhouse gas abated by the particular technology installed. If you install an energy efficient appliance and don't 'sell' your VEECs in exchange for a discount on the cost, the energy retailers will have to aquire them elsewhere, meaning additional energy efficient appliances are installed and additional abatement occurs.

    Effectively, by selling VEECs you are contributing to the State's 10% household energy efficiency target, but by retaining them you will be responsible for abatement above this target.

    Further Information
    The Victorian Government has two websites about the VEET Scheme. The first is a user-friendly 'Energy Saver Incentive' website where consumers can find products and services that include a VEEC discount. Visit: http://www.saveenergy.vic.gov.au/shopsmart/465.aspx#475

    The Victorian Essential Services Commission administers and oversees the VEET Scheme. Their website has more detailed resources to help you calculate how many VEECs you're eligible for and see who is buying and selling VEECs. Visit: http://www.esc.vic.gov.au/public/VEET/
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