By Maddocks Sustainability and Climate Change Team
The federal government's Energy Efficiency Opportunities Program (EEO Program) was established in July 2006. Its primary aim is to assist large consumers of energy to identify opportunities to improve energy efficiency. It achieves this by requiring businesses that are large users of energy to identify, evaluate and report publicly on cost-effective energy savings opportunities.
More specifically, corporations covered by the Program must report publicly on the results of their energy efficiency assessments and the opportunities that exist for projects with a financial payback of up to four years. The assessments must be undertaken in accordance with the Program's assessment framework. The reports must identify the energy saving opportunities, quantify the amount of energy that could be saved and state the entity's response to the opportunities.
Participation in the EEO Program is mandatory for corporations that use more than 0.5 petajoules (PJ) of energy per year, which is roughly equivalent to the energy used by 10,000 households. There are more than 220 corporations currently registered for the program.
Obligations under the EE O Program are imposed upon the controlling corporation of a corporate group. The controlling corporation must comply with the EE O reporting obligations for all its major business entities, including subsidiaries, joint ventures, partnerships, business units, sites and activities.
Notably, the EEO Program mandates reporting and publication of information on energy efficiency action rather than requiring compliance with strict energy efficiency standards. Nevertheless, it still has the potential to play a powerful role in motivating investment in energy efficiency by raising awareness about energy efficiency opportunities and their benefits.
'First Opportunities Report'
In February 2010, the federal government released its 'First Opportunities Report, which considers the results of the EE O Program for the period 2006-2008. The Report found that:
- Corporations in the manufacturing, mining and transport industries used the largest amount of energy in 2007-2008.
- The services sector - including retail trade, banking and finance, telecommunications and commercial property - was a relatively small energy consumer.
- Corporations currently participating in the EE O Program identified opportunities to save 6.4 million tonnes of CO2-e (MtCO2-e) per year, which is equivalent to 1.1% of Australia's 2006-2007 total greenhouse gas emissions.
- Action to reduce emissions by 3.9 MtCO2-e per year has already been implemented or committed to.
- Identified energy savings were expected to lead to net financial benefits of $735.8 million for projects with payback periods of four years or less.
Types of Energy Efficiency Opportunities
Reports lodged by companies participating in the EE O Program revealed a broad range of energy efficiency opportunities. The First Opportunities Report states that some of the largest individual opportunities resulted from an assessment of energy use in a whole-ofbusiness context to determine the amount of energy use that was needed and how this energy use could be met most efficiently. The Report also notes that optimising processes or improving technology performance – such as turning off redundant equipment and better start-up and shut-down procedures – can be a low cost way of increasing energy efficiency. However, availability of good data and the existence of effective communication with operational managers is needed to capitalise on these types of opportunities.
Examples of energy efficiency opportunities identified in the Report include:
- Process control
- New technology investments
- Retrofitting of existing equipment
- Improved energy metering
Other energy efficiency reporting tools
Various other types of energy efficiency reporting tools exist at the state and federal levels to encourage the adoption of energy efficiency measures, such as:
- The Mandatory Energy Efficiency Disclosure Scheme: This Scheme is due to commence in 2010. It will originally apply to commercial office buildings over a prescribed size, but will eventually be extended to apply to residential buildings in 2011. The central requirement of the Mandatory Disclosure Scheme is that, when certain commercial buildings are sold, leased or sub-leased, an energy efficiency rating and assessment report must be disclosed by the owner or tenant.
- National Greenhouse and Energy Reporting Scheme: This Scheme establishes a single national framework for corporations to report energy consumption as well as energy production and greenhouse gas emissions. It commenced on 1 July 2008 and entails compulsory registration and annual reporting for corporations whose energy consumption (and energy production and greenhouse emissions) exceed specified thresholds.
- Environment and Resource Efficiency Plans (VIC): The EREP program, which came into effect on 1 January 2008, applies to sites that consume large amounts of energy and water – specifically, those using more than 100 TJ of energy and/or 120 ML of water per annum. Under the program, these businesses must assess their energy and water use, prepare a plan to improve the efficiency of the use of these resources, then implement all actions with a three year or better payback period. Annual reporting obligations apply. Large energy consumers in Victoria that are required to participate in both the EE O program and the ERE P program may be entitled to partial exemption from some of the ERE P requirements through fulfilment of obligations under the EEO Program.
- Energy Action Plans (NSW): The NSW Government introduced legislation in May 2005 requiring large consumers of energy and NSW government agencies and local councils to prepare Energy Savings Action Plans. (Similar obligations exist with respect to Water Savings Action Plans.) Among other things, development of ES APs requires a stock-take to be undertaken of current energy use, assessment of energy-saving measures, identification of action to achieve savings and annual reporting. ES APs must be completed by NSW businesses and government agencies with sites using more than 10 GWh of electricity a year, and local councils with populations of more than 50,000 people. Partial exemption from ES AP requirements is possible for large energy consumers that are also covered by the EEO program.
Energy efficiency and consumption reporting through the various tools that exist help change behaviour among those subject to the relevant obligations as well as those who have access to the energy efficiency and consumption reports.
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