The Victorian Energy Upgrades program (previously the ‘VEET scheme’) is established under the Victorian Energy Efficiency Target Act 2007, the Victorian Energy Efficiency Target Regulations 2008 and the Victorian Energy Efficiency Target (Project-Based Activities) Regulations 2017 (DELWP, 2020).
The purpose of the VEUP program is to cut power bills, reduce greenhouse gas emissions and promote sustainable development by giving residential, commercial and businesses access to free energy-efficient products and services.
The program is administered by the Essential Services Commission (ESC), which is the independent regulator of the retail energy industry in Victoria. Its role is to oversee compliance and performance reporting by energy businesses, and to accredit businesses and the products and services which are eligible under the program. It gives accreditation to the persons to create certificates, auditing those persons, and managing the certificate register. The ESC has also produced the Victorian Energy Efficiency Target Guidelines.
The program places a legal requirement on energy retailer companies to meet an annual greenhouse gas emissions reduction target by surrendering Victorian Energy Efficiency Certificate.
To meet the objectives, Energy retailers are able to create certificates directly, or purchase certificates in a competitive market from Accredited providers who deliver these financial incentives and generate Victorian Energy Efficiency Certificates (VEECs). The number of certificates generated is based on the greenhouse gas savings that are associated with the product or service. The level of incentive or discount received by households and businesses varies depending on the market activity and certificate price.
Each certificate represents a tonne of greenhouse gas abated and is known as a Victorian energy efficiency certificate (VEEC). For the last year the scheme target was 6.3 million VEECs per annum, increased to 6.5 million VEECs per annum during the financial year 2020, starting on 1 January 2020.