Australia, Policy, Renewables, Solar, Storage

Extensions confirmed for popular energy upgrades program

The Victorian Government has announced plans to extend its Victorian Energy Upgrades Program (VEU) until 2045.

This extension aims to provide long-term support for households and businesses in reducing energy bills through discounts on energy-efficient electric appliances.

The government will introduce legislation to implement this extension, along with other reforms to encourage the adoption of energy-saving electric appliances. These changes are part of Victoria’s efforts to achieve net-zero emissions by 2045.

A comprehensive review of the VEU program will be conducted over the next two years to ensure it effectively supports Victorians in reducing energy costs through electrification.

During this review period, the government will set interim energy savings targets for retailers for 2026 and 2027.

The proposed reforms also include strengthening the enforcement powers of the Essential Services Commission (ESC). The ESC’s oversight will be expanded to cover both accredited providers and installers.

To address the pricing of Victorian Energy Efficiency Certificates (VEECs), the government plans to remove the requirement for certificates to be created by January 31 for the previous calendar year.

This change aims to give energy retailers more flexibility in acquiring certificates and potentially reduce demand.

Since transitioning to an all-electric program in 2023, the VEU has provided rebates for 19,000 reverse cycle air conditioners and 39,000 hot water systems, contributing to a reduction of 28 million tonnes of emissions.

The program also supports 2200 jobs in the energy efficiency sector.

Households replacing gas ducted heating systems with electric alternatives can receive discounts of up to $3600 and save approximately $600 annually on energy bills. Similarly, switching to an electric heat pump hot water system can result in yearly savings of $250 compared to gas units.

The government expects to finalise the proposed reforms, known as the Victorian Energy Efficiency Target Amendment (Energy Upgrades for the Future) Bill 2024, in 2025.

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