‘SETTING FUTURE VICTORIAN ENERGY EFFICIENCY TARGETS’
Consultation Paper Response – SouthGippsland Shire Council
May 2015
Introduction
South Gippsland Shire Councilwelcomes the opportunity to provide the below feedback to the Victorian Energy Efficiency Target (VEET) Consultation Paper, Setting Future Victorian Energy Efficiency Targets.
Response to Questions
South Gippsland Shire Council(SGSC) support the submission made by the Municipal Association of Victoria (MAV), and endorses the suggestions made and feedback given via their submission. In addition, we would make the following observations and additional recommendations to the specific questions detailed in the Consultation Paper.
6. Should the VEET scheme be amended to better ensuresupport for low income households?
As per the MAV submission, SGSC strongly believes the VEET scheme should be amended to ensure better support for low-income households.
A significant number of low income householders are renters. As such, in addition to the market failures outlined in the MAV submission, another market failure affecting low income households involves split incentives between landlords and tenants. While landlords have the ultimate control over energy efficiency upgrades to homes – fromupgrading hot water units draught proofing and the installation of insulation – it is the tenants who are left to pay the bills, without either the right to make changes to the home, nor the security of tenure necessary to consider undertaking such investments.
It is essential that the VEET scheme addresses this area of market failure, through thoughtful design and implementation.
Further, there are a significant and growing number of households in financial hardship who may not be categorised as ‘low income’ – those that may have moderate income but live in large and inefficient homes and be constrained by significant levels of personal debt. These households and the VEET scheme more broadly would greatly benefit from the introduction of an in-home energy assessment and referral service, similar to that offered under the former Federal Government’s Home Energy Saver Scheme (HESS). This could, and probably should, be an obligation upon the energy retailers through their presently-inadequate hardship provisions, whereby they are required to provide an in-home energy assessment and referral to relevant other services (such as those provided for through VEET).
In addition, whilst outside the scope of the VEET scheme, the Government should consider implementing minimum standards for rental accommodation, combined with incentives for landlords to meet those standards. This would go some way to addressing the split incentive issue faced by tenants, complementing the objectives of the VEET scheme and ensuring that tenants benefit from the full range of energy efficiency measures available under VEET.
7. In addition to expanding the range of energy efficiencyactivities available in VEET, should any other action betaken to target participation by certain groups?
Consideration should be given to the capacity for VEET services to reach rural and regional areas, rather than just be concentrated in metropolitan Melbourne. This could be achieved via a ‘banding’ measure, based on postcodes, where municipalities further from Melbourne (perhaps assessed by postcodes not well serviced by VEET in past years) are given a multiplier to the number of VEETs they would be eligible for, for any given measure.
The concerns around this would obviously be either diluting the overall target (if VEECs surrendered were counted at their multiplied rate) or an increase in the cost of the scheme (if VEECs were balanced to ensure that the overall emissions target was still achieved).
We believe that any multiplier for rural postcodes would only need to be very minor, and as such the balancing of the VEET target to cancel out the effect of the multiplier should be the preferred option to ensure the integrity of the scheme is maintained in terms of achieving the emissions reduction target. Any increase in the cost of the scheme would be minimal, and could be mitigated by commencing with a very moderate multiplier in the initial stages, with reviews to ensure the effectiveness over time.
8. Please suggest up to five activities that should be prioritisedfor revision or introduction to the VEET scheme.
SGSC firmly believes that a future VEET scheme should include ceiling insulation given this is one of the most cost-effective measures to improve the thermal performance of homes in the Victorian climate zone(s). Accreditation, training and auditing measures can be put in place to mitigate any risks associated with this measure, as are currently being employed and demonstrated by the South East Councils Climate Change Alliance Energy Saver Study program. (
Questions
South Gippsland Shire Council would welcome any opportunity to discuss any aspect of the above submission.
Please direct any question to:
Brad Kijlstra-Shone
Sustainability Officer
P: 03 5662 9815
M: 0417 557 152