Meeting in early October, COAG agreed to develop a National Strategy for Energy Efficiency in order to accelerate energy efficiency efforts across all governments and to help households and business prepare for the introduction of the Carbon Pollution Reduction Scheme (CPRS).

Streamlined roles and responsibilities for energy efficiency policies and programs are scheduled to be agreed by December this year. The strategy is expected to be finalised by December 2008 with implementation from June 2009 to ensure that all programs are in place prior to the introduction of the CPRS.

The Clean Energy Council has welcomed the announcement. Council National Policy Manager Vikki McLeod has congratulated the government for recognising energy efficiency as a necessary and complementary measure to the introduction of the CPRS.

“Realising the full potential for energy efficiency is particularly important in buying time, cushioning the price impacts and risks associated with the introduction of a CPRS is key to making the transition from a high to low carbon economy,” says Ms McLeod.

“The elegance of energy efficiency technology,” she continues, “is that the energy savings mean it will pay for itself. It will also deliver productivity enhancement benefits, reduced need for additional infrastructure as well as protection for low income households from the increasing costs of energy.”

Ms McLeod says that a national energy efficiency strategy needs to build on the existing National Framework of Energy Efficiency (NFEE) – a two stage strategy that was announced by COAG in 2004.

“NFEE is still valid and the actions and measures identified to address the barriers are still valid. However, NFEE has failed on implementation,” explains Ms McLeod. “The reasons it failed on implementation need to be addressed.”

While COAG agreed to develop national legislation for appliance energy performance standards and labelling to simplify enforcement and ensure consistency, Ms Mcleod says the Clean Energy Council would like to see the NFEE actions of minimum performance of buildings and appliances to be strengthened and accelerated.

“Rather than eliminating worst practice, the NFEE should promote best practice for the industry. For example, houses should be built at a minimum of five stars, with a solar hot water heater included. This energy efficiency standard should increase to a higher rating over time. We should be aiming to match the UK standard of carbon neutral, or 10-star, housing by 2016.”

The Clean Energy Council argues that a national strategy for energy efficiency must introduce policy to enable accelerated access to the hard to get at retrofit market. “Currently the Australian Government is only looking at new appliances and buildings that will take decades to filter through as standard practice,” says Ms McLeod. “The state governments are introducing policies to create retrofit markets and we should be learning lessons from these schemes.

“There is a need to engage the energy service industry, energy retailers, product suppliers – such as the insulation and water heating industries – product installers and tradies who are ideally placed to partner with householders as a one-stop-shop, providing point of sale incentives and information.”

Ms McLeod says that point of sale incentives can be achieved through a number of policy options, including rebates, product labelling and the mandatory disclosure of a building’s energy rating at the time of sale or lease.

The Clean Energy Council also argues that a more effective approach to energy efficiency would be to leverage the CPRS revenue or the green loans scheme through a nationally consistent energy efficiency target. In this way, explains Ms McLeod, the energy retailer and energy service industries will be encouraged to innovate and value add products to implement energy savings.

The Prime Minister, Premiers, Chief Minister of the Northern Territory and the President of the Australian Local Government Association, were joined at the COAG meeting by Commonwealth, State and Northern Territory Treasurers. COAG will hold its next meeting in Canberra on 17 November 2008.