Victorian Bills Explanatory Memoranda Victorian Bills Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
Victorian Energy Efficiency Target
Bill 2007
Introduction Print
EXPLANATORY MEMORANDUM
General
The Act will promote the reduction of greenhouse gas emissions by
establishing the Victorian Energy Efficiency Target scheme and will confer
functions on the Essential Services Commission to administer the scheme.
Clause Notes
PART 1--PRELIMINARY
Clause 1 sets out the purpose of the Act.
Clause 2 is the commencement provision. The Act will, subject to earlier
proclamation, come into operation on 1 January 2009.
Clause 3 sets out the definitions used in the Act, including--
accredited person--a person accredited under the Act who may
create a certificate in relation to a prescribed activity;
certificate--an energy efficiency certificate created under the
Act;
prescribed activity--a prescribed activity for the purposes of
section 15 of the Act;
relevant entity--a person who sells electricity or gas or both, has
5000 or more gas or electricity customers in Victoria and makes a
scheme acquisition of electricity or gas and consequently must
surrender certificates;
scheme acquisition--the kinds of acquisitions of electricity or
gas which result in the requirement for relevant entities to
surrender certificates (see also the definition of relevant entity
and Part 4 of the Act).
561102 1 BILL LA INTRODUCTION 30/10/2007
Clause 4 sets out the objects of the Act, which include to--
· reduce emissions of greenhouse gases;
· encourage the efficient use of gas and electricity; and
· encourage investment, employment and technology
development in industries which supply goods or
services which reduce the use of electricity and gas by
consumers.
Clause 5 provides that the Act binds the Crown.
Clause 6 provides for the Act to have extra-territorial operation.
PART 2--ADMINISTRATION
Clause 7 provides that the ESC is responsible for general administration of
the Act, including: accreditation, enforcement, compliance and
reporting on the operation of the Act in its annual report of
operations under the Financial Management Act 1994.
Clause 8 provides for the Minister to approve a law of another State or
Territory to be an approved interstate energy efficiency regime
for the purposes of the Act.
PART 3--ENERGY EFFICIENCY CERTIFICATES
Division 1--Accredited persons
Clause 9 provides for the making of applications for accreditation under
the Act.
Clause 10 sets out requirements which the ESC may make with respect to
an application for accreditation.
Clause 11 provides that the ESC may approve or refuse an application for
accreditation.
Clause 12 specifies the time (20 business days) within which the ESC must
decide an application for accreditation. A longer period may be
agreed with the applicant.
Clause 13 provides for the allocation of unique registration numbers.
2
Clause 14 provides for the suspension of a person's accreditation for up to
two years if that person is convicted of the offence relating to the
creation of certificates under clause 20. In the case of a second
conviction, the suspension may be for a longer period or
permanent.
This clause also provides for the suspension of a person's
accreditation for up to 12 months if the ESC believes on
reasonable grounds that the person has committed an offence
against the Act or has breached an undertaking given to the ESC
or for such period (including permanently) as the ESC considers
appropriate if the registration was obtained improperly.
Division 2--Prescribed activities
Clause 15 provides that regulations made under clause 75 may prescribe an
activity to be a prescribed activity if the activity will result in a
reduction of greenhouse gas emissions which would not
otherwise have occurred if the activity was not undertaken.
Such activities may include purchasing or installing an energy
efficient appliance or equipment.
Division 3--Creation of certificates
Clause 16 establishes the entitlement for an accredited person to create a
certificate. If they are accredited, consumers of electricity or gas
and landlords of rented premises will be able to create certificates
for prescribed activities undertaken at their premises.
Clause 17 provides that a certificate must be created no later than 6 months
after the end of the year in which the prescribed activity has been
undertaken. Clause 15 provides that a prescribed activity is to be
undertaken either in Victoria or in another State or Territory in
which an approved interstate energy efficiency regime is in force.
This clause also provides that regulations under the Act will
prescribe when a prescribed activity is to be taken to have been
undertaken and the conditions or circumstances under which a
certificate cannot be created for a prescribed activity.
Clause 18 provides that a certificate may be created for each whole tonne of
carbon dioxide equivalent of greenhouse gas emissions to be
reduced by a prescribed activity.
3
This clause also provides that regulations under the Act will
provide for the method and variables to be used to calculate the
carbon dioxide equivalent of greenhouse gas emissions to be
reduced by a prescribed activity.
Clause 19 provides that the Minister may declare, by notice published in the
Government Gazette, discount factors to be used to calculate the
carbon dioxide equivalent of greenhouse gas emissions to be
reduced by a prescribed activity. The Minister must first publish
notice of intention including procedures for the making of
submissions on a proposed discount factor.
Clause 20 provides that a person who is not entitled to create certificates
must not do so. The maximum penalty for a contravention is
60 penalty units for an individual and 240 penalty units for a
body corporate.
The clause also provides that an accredited person must not
create a certificate--
· in respect of a prescribed activity which occurred before the
person applied for accreditation;
· during any period in which accreditation was suspended;
· in respect of a prescribed activity if the accredited person
has previously created a certificate under the Act in respect
of that activity; and
· in respect of a prescribed activity if the accredited person
has previously created a certificate under another scheme
prescribed by the regulations that aims to promote the
reduction of greenhouse gas emissions in respect of that
activity.
The maximum penalty for a contravention is 60 penalty units for
an individual and 240 penalty units for a body corporate.
Division 4--Form, registration and transfer of certificates
Clause 21 requires certificates to be created in an electronic form approved
by the ESC. Each certificate is to include a unique identification
code.
Clause 22 provides that a certificate is not valid until it is registered.
The ESC must register certificates it determines are eligible for
registration.
4
Clause 23 provides that a certificate expires 6 years after it was created or
its earlier surrender to the ESC.
Clause 24 provides that registered certificates may be transferred to any
person. The ESC is to be notified of the transfer of a certificate.
The ESC must record the transferee as the owner of the
certificate in the register of energy efficiency certificates.
Division 5--Retirement of certificates
Clause 25 provides that the owner of a certificate may voluntarily surrender
it to the ESC.
Clause 26 provides that a certificate ceases to be valid if it is surrendered.
The ESC must adjust the register of energy efficiency certificates
accordingly.
PART 4--ENERGY EFFICIENCY CERTIFICATE
SHORTFALL
Clause 27 prohibits a relevant entity from having an energy efficiency
certificate shortfall for a year in which it makes a scheme
acquisition.
Clause 28 makes a relevant entity that has an energy efficiency certificate
shortfall in a year liable to pay an energy efficiency shortfall
penalty. The energy efficiency shortfall payable is to be
calculated by multiplying the relevant entity's energy efficiency
shortfall for a year by the prescribed shortfall penalty rate for that
year.
Clause 29 provides for the calculation of a relevant entity's energy
efficiency certificate shortfall and carried forward surplus for a
year, based on the number of tonnes of carbon dioxide equivalent
of greenhouse gas emissions which the relevant entity is liable
for in the year.
Clause 30 provides that for the first 3 years commencing 1 January 2009,
the VEET scheme target is to be 2.7 million tonnes per annum of
carbon dioxide equivalent and in each 3 year period commencing
1 January 2012 and ending in 2029 the target shall be prescribed
by regulations.
Clause 31 sets out the calculation of greenhouse gas emissions liability in
respect of both electricity and gas for a relevant entity in a year.
5
Clause 32 provides that an Order in Council fixing greenhouse gas
reduction rates for electricity and for gas for 2009 must be made
by 31 May 2009 and for each subsequent year by 31 May in that
subsequent year. If an Order in Council is not fixed for each
subsequent year the greenhouse gas reduction rate for electricity
and for gas are to be those fixed for the previous year.
PART 5--STATEMENTS AND SURRENDER OF
CERTIFICATES
Clause 33 requires a relevant entity which acquired electricity or gas under
a scheme acquisition during a year to lodge an audited energy
acquisition statement for the year on or before 30 April in the
following year. An energy acquisition statement must include
the amount of electricity or gas acquired under scheme
acquisitions during the year, the value, in tonnes of carbon
dioxide equivalent, of certificates being surrendered and any
carried forward surplus.
Clause 34 provides that a certificate cannot be surrendered unless--
· it is valid; and
· it was created before 31 January in the year following
the year to which the energy acquisition statement
relates; and
· the relevant entity is recorded in the register of energy
efficiency certificates as the owner of the certificate.
Clause 35 requires the payment by the relevant entity of fees fixed under
clause 73 for the surrender of certificates detailed in the energy
acquisition statement under clause 34.
PART 6--ENFORCEMENT
Clause 36 provides that, if the ESC considers that a relevant entity has an
energy efficiency certificate shortfall for a year in which it made
a scheme acquisition of electricity or gas, the ESC may issue a
shortfall statement to the relevant entity. The shortfall statement
must include the relevant entity's energy efficiency certificate
shortfall for the year, the energy efficiency shortfall penalty
which the relevant entity is liable to pay, the due date and the
method of payment of that penalty.
6
Clause 37 provides that if the energy efficiency shortfall penalty is not paid
in accordance with a shortfall notice, the ESC may apply to a
court for a declaration that the relevant entity has an energy
efficiency shortfall for a year and an order requiring the relevant
entity to pay the energy efficiency shortfall penalty.
Clause 38 empowers the ESC to require a person to surrender certificates
following the issue of a certificate surrender notice. Such a
notice may be issued if the ESC believes that the person has
breached an undertaking given to the ESC and the ESC has
suspended the person's accreditation. The maximum penalty for
failure to comply with an order is 600 penalty units and an
additional 1 penalty unit for each certificate which the person
fails to surrender in accordance with the order.
Clause 39 provides that if certificates are not surrendered in accordance
with a certificate surrender notice, the ESC may apply to a court
for a declaration that an undertaking was breached and an order
requiring the surrender to the ESC of the number of certificates
specified in the order.
Clause 40 empowers the ESC to order a person to surrender certificates.
Such an order may be made only if a person is found guilty of
an offence under clause 20 (offences relating to creation of
certificates). The maximum penalty for failure to comply with an
order is 600 penalty units and an additional 1 penalty unit for
each certificate which the person fails to surrender in accordance
with the order.
PART 7--POWERS OF AUTHORISED OFFICERS
Division 1--Appointment of authorised officers
Clause 41 provides for the ESC to appoint persons with appropriate skills,
qualifications and experience as authorised officers.
Clause 42 requires the ESC to issue identity cards to authorised officers and
also requires authorised officers to carry and produce their
identity cards.
Division 2--Powers of authorised officer
Clause 43 provides that an authorised officer may exercise his or her
powers only to the extent reasonably necessary for substantiating
information or determining compliance.
7
Clause 44 provides that an authorised officer may enter premises at any
reasonable time to exercise monitoring powers (see clause 48).
Entry must be with the occupier's consent (see also clause 46)
or pursuant to a monitoring warrant (see also clause 47).
Clause 45 requires an authorised officer to inform the occupier of the
purpose of entry or, in the occupier's absence, leave a notice
setting out, amongst other things, the time and purpose of entry.
Clause 46 provides for an acknowledgement of consent to entry to be
obtained from an occupier. If an acknowledgement is not
obtained, entry must be presumed to be without consent
(excluding entry pursuant to a monitoring warrant), until the
contrary is proved.
Clause 47 requires an authorised officer to announce when he or she is
entering premises under a monitoring warrant and to make a copy
of the warrant available.
Clause 48 provides for an authorised officer's monitoring powers, including:
to search premises for any thing which may relate to the creation
or transfer of certificates or to scheme acquisitions, to take
photographs or make video or audio recordings, to inspect, and
take extracts from or make copies of, documents, to secure any
thing found until a warrant to seize that thing is obtained.
The monitoring powers also include power to operate equipment
to determine whether it contains relevant information and power
to operate facilities to put such information into documentary or
electronic form.
Clause 49 empowers an authorised officer to ask for relevant information or
require the production of a relevant document where he or she
has entered premises with consent.
Clause 50 empowers an authorised officer to ask for relevant information or
require the production of a relevant document where he or she
has entered premises under a monitoring warrant.
Clause 51 creates an offence of failing, without reasonable excuse, to
answer a question or produce a document under clause 50.
The maximum penalty is 60 penalty units.
Clause 52 provides for protection against self-incrimination.
8
Division 3--Occupiers' rights and responsibilities
Clause 53 provides that an occupier, or the representative of an occupier, is
entitled to be present during the execution of a monitoring
warrant, so long as that person does not impede execution of the
warrant.
Clause 54 requires the occupier, or the occupier's representative, to assist an
authorised officer executing a warrant. Failure to do so will be
an offence, with a maximum penalty of 60 penalty units for an
individual or 240 penalty units for a body corporate.
Division 4--Monitoring warrants
Clause 55 provides for an authorised officer to apply to a magistrate for a
monitoring warrant. The magistrate may issue the warrant if he
or she is satisfied, by information on oath, that access to premises
is reasonably necessary to substantiate information or determine
compliance. A warrant must state the purpose for which it is
issued and whether entry is authorised at any time of day or only
during specified hours. A warrant will cease to have effect on the
day specified, which cannot be more than six months after issue.
PART 8--GENERAL
Division 1--Review of decisions
Clause 56 provides that an affected person in relation to a reviewable
decision may request that the ESC reconsider that decision.
A request must be made within 30 business days after the making
of the decision. Reviewable decisions are set out in the Table at
the foot of subclause (2) and include refusal to accredit a person
and not registering a certificate. The ESC will have 40 business
days in which to reconsider its original decision and if it does not
respond within that time it will be taken to have confirmed that
decision.
Division 2--Registers
Clause 57 requires the ESC to maintain various registers for the purposes of
the Act. The registers are to be maintained electronically and
must be available for inspection on the ESC's website.
Additions to the registers must be posted within 20 business days.
Clause 58 provides that the register of accredited persons must include the
name and registration number of each accredited person and
details of any suspension of accreditation.
9
Clause 59 provides that the register of energy efficiency certificates must
include details of the creation and ownership of each certificate.
Division 3--Information provisions
Clause 60 empowers the ESC to require production of information and
documents relevant to the operation of the Act. Such a
requirement will be made by written notice.
Clause 61 creates an offence of failing, without reasonable excuse, to
comply with a notice under clause 60. The maximum penalty is
60 penalty units for an individual or 240 penalty units for a body
corporate.
Clause 62 provides for protection against self-incrimination.
Clause 63 empowers the ESC to inspect and copy documents produced in
response to a notice under Division 3.
Clause 64 provides for the ESC to retain documents provided in response to
a notice under Division 3.
Clause 65 creates two offences: disclosure of confidential or commercially
sensitive information (maximum penalty of 60 penalty units),
and use of such information to obtain a pecuniary advantage
(maximum penalty of 120 penalty units). Subclause (3) provides
for circumstances in which information may be disclosed or used
(for example, with the consent of the person who supplied the
information or where the information is in the public domain).
Clause 66 provides that the ESC is not prevented from divulging or
communicating information to certain persons, including the
Minister, VENCorp, NEMMCO, Sustainability Victoria, the
administrator of an approved interstate energy efficiency regime
and certain relevant Commonwealth entities.
Clause 67 requires the ESC to publish specified information, including a list
of relevant entities with energy efficiency certificate shortfalls.
The number of certificates created in a year, and the number of
certificates surrendered in a year, must also be published.
Division 4--General offences
Clause 68 creates the offence of knowingly providing false or misleading
information or documents to the ESC. The maximum penalty is
60 penalty units for an individual or 240 penalty units for a body
corporate.
10
Clause 69 creates the offence of failing to provide documents to the ESC as
required. The maximum penalty is 60 penalty units for an
individual or 240 penalty units for a body corporate.
Clause 70 provides that, where a body corporate commits an offence, an
officer (as defined) of the body corporate will also be guilty of
the offence, and liable to the penalty, if he or she knowingly
authorised or permitted the commission of the offence.
Division 5--Evidence and records
Clause 71 is an evidentiary provision with respect to ESC documents.
Clause 72 requires accredited persons and relevant entities to keep records,
for six years, of transactions and other activities pursuant to the
Act including records of certificates created and amounts of
electricity and gas acquired. The maximum penalty for a
contravention of this requirement is 60 penalty units for an
individual or 240 penalty units for a body corporate.
Division 6--Fees
Clause 73 provides for the fixing of fees, including fees for applications for
accreditation, creation of certificates, review of decisions,
lodging of statements and surrender of certificates. The Minister
will fix fees, taking into account the ESC's costs and expenses,
and after consultation with the Minister administering the
Essential Services Commission Act 2001. A fixed fee need not
be limited to the cost of providing a service. Fees must be
published in the Government Gazette and on the ESC's website.
Division 7--ESC guidelines
Clause 74 provides for the preparation and issuing of guidelines for or with
respect to any matter required or permitted, including with
respect to the accreditation of a person, scheme acquisitions,
annual energy acquisition statements, audits and records to be
kept. Guidelines must be published in the Government Gazette
and on the ESC's website.
Division 8--Regulations
Clause 75 provides for the making of regulations for or with respect to
various matters, including prescribing activities in respect of
which a certificate can be created, the calculation of, and
variables to be used to determine the number of certificates
which may be created in respect of a prescribed activity and the
targets applying in the years 2012 and beyond.
11
Division 9--Review of Act
Clause 76 requires a review of the Act to be undertaken by 31 December
2011. The review must include consideration of such matters as
the extent to which the objects of the Act have been achieved,
the required targets applying under the Act, the extent of
technological development and the level of penalties provided for
under the Act.
PART 9--AMENDMENT OF ESSENTIAL SERVICES
COMMISSION ACT 2001
Clause 77 inserts a new section 10(k) into the Essential Services
Commission Act 2001 to confer functions on the ESC.
Clause 78 inserts a new section 10D into the Essential Services
Commission Act 2001 to identify the provisions of the Essential
Services Commission Act 2001 which do not apply to the ESC's
functions under this Act.
Clause 79 provides for the automatic repeal of this amending Part 9 of the
Act on 1 January 2010. As suggested by the Scrutiny of Acts and
Regulations Committee, all amending Bills now contain an
automatic repeal provision, which will save the time and expense
of having to repeal amending Acts in statute law revision Bills.
The repeal of Part 9 does not affect in any way the operation of
the amendments made by this Act (see section 15(1) of the
Interpretation of Legislation Act 1984).
12