Efficiency Action – March 2018
The Energy Efficiency Council's monthly e-newsletter, exclusively for EEC Members.
I’m writing this from Paris at the end of a packed ten days connecting with businesses, governments and peak bodies across Europe. The first five days of the trip were as part of a delegation to Germany and Switzerland led by new EEC Board Member Stefan Schwab, and I’m spending another five days in UK and France. The trip will be capped tomorrow with an International Energy Agency (IEA) workshop being attended by experts from around the world, focused on finding ways to link energy efficiency and renewables policy.
Given the trip isn’t done yet, it’s a little early to share take-outs. However, it’s clear that much of Europe – particularly continental Europe – is taking energy efficiency and demand response very seriously. The IEA’s framing of energy efficiency as the ‘first fuel’ – the one that we should turn to first before considering supply side investments – is now a clear mantra of the European Commission. Some countries are following Germany’s early leadership and making significant demand side investments. Others are dragging their feet. However the trend line is clear: the demand side is going to be central to Europe’s energy future.
Luke Menzel, CEO, Energy Efficiency Council
Since the last newsletter there have been two state elections, which I go into in detail below. Aside from (and partially because of) the elections, it has been a period of much sound and fury and relatively few serious developments.
The Tasmanian and South Australian elections will have significant implications for energy efficiency policy in those states and nationally. The election of two Coalition governments will make it more likely that the Federal government can introduce its proposed National Energy Guarantee (NEG). These elections could also make other Labor states nervous, especially Victoria. However, the story isn’t that simple – there was a small swing in both states towards Labor (I’ll explain later about the bizarre fact that the South Australian Labor party both lost government and had a swing towards it).
The Energy Security Board has been consulting on its NEG in preparation for the upcoming meeting of the country’s energy ministers. The Energy Efficiency Council (EEC’s) submission to the NEG consultation can be found here.
Our key message was that the NEG needs to be complemented by strong action on energy efficiency through the National Energy Productivity Plan (NEPP). We have been working hard behind the scenes pushing for governments to adopt new, stronger policies and we hope that this work will bear fruit in coming months.
The case for energy management has shifted – it isn’t just about greenhouse or energy affordability any more, it’s about cheap, reliable capacity. This point was confirmed this week with a new report by the world-renowned Energy Research Centre. The report looked at the future of energy security in the UK and had a wide range of messages. However, their key message was unequivocal - energy management is critical to energy security; by reducing energy demand we reduce exposure to risks such as energy shocks and energy shortages.
With so much going on, including preparation for the Victorian election later this year, the energy efficiency sector has been punching well above its weight in the national debate. I’d like to thank you all for your incredibly hard work, and look forward to some seriously in-depth conversations over the coming months as we update our Energy Efficiency Policy Handbook.
On 3 March Tasmanian’s re-elected the Hodgman Liberal Government for a second term, with a small swing to Labor. The hottest electoral issues were jobs and the proposal to reduce poker machines in the state, with energy having a much lower focus. However, the Hodgman Government has committed to Tasmania ‘exiting the National Electricity Market (NEM)’.
What this ‘TasExist’ means in practice is unclear – it could be anything from simply separating Tasmania from the Victorian NEM region or a much larger shift in the electricity rules and regulations in Tasmania. However, one thing is absolutely certain – this is an unequivocal statement that Tasmania has lost faith in the national administration of the energy market.
Energy markets around the world are struggling to adapt to the rapid changes in generation and energy use, and this is reducing confidence in many overseas energy markets. However, the loss of faith in the NEM, and particularly the Australian Energy Market Commission (AEMC), has been extraordinary.
While the AEMC isn’t responsible for all of the factors that lead to this loss of confidence (with the appalling politicisation of energy in Australia winning the gold star), it has been widely criticized as being far too slow and conservative in its modifications of the NEM rules and regulations. The pressure for reform at the top appears to be inexorable.
The Hodgman Government introduced some modest energy efficiency programs in its first term. The Tasmanian Energy Efficiency Loans Scheme provides interest-free finance to households and small businesses for specified energy efficiency products. This positive first step is more modest than energy efficiency programs in NSW and Victoria, but suggests that the Tasmanian Government may be open to more ambitious action on energy management at either the state or national level.
On 17 March South Australia had a far more contested election that attracted far more press. Political experts weren’t prepared to make any concrete predictions on this elections based on the polls: Nick Xenophon was making a serious tilt as Premier, or at least kingmaker, and the Liberals were polling far lower than you’d expect against a Labor Government that had been in power for 16 years.
In the end, the Marshall Coalition Government was narrowly elected after it won an additional three seats, and Xenophon’s party performed much worse than expected. However, this election wasn’t a simple story. The state effectively changed hands due to a shift in electoral boundaries that was long overdue – the Coalition actually won the popular vote in 2014 with 53 per cent of the votes on a two-party basis. In fact, in March 2018 there was a swing of 2 per cent towards Labor, which is extraordinary for a party that had been in power for four terms.
The reason I’m going into political wonk land is these results are VERY important for the energy sector. Electricity was the number one issue in the South Australian election – South Australians are deeply concerned about energy affordability and reliability, but they’re also (by and large) proud of their world-leading battery and humongous amounts of renewable energy. This presents a complex challenge for the Marshall Government – South Australians want lower energy bills, but they’re in no mood for turning back the clock.
I’d like to drop a big, sobering elephant into the room. The South Australian Labor Government’s renewable energy target was a total furphy. It didn’t place an obligation on energy companies, or provide an incentive for renewable energy developers. It was purely aspirational.
Renewable energy investment flowed into South Australia because of the national renewable energy target, combined with South Australia having high electricity prices, excellent wind resources, a supportive planning system and other states blocking the development of renewable energy projects.
The South Australian Government’s aspirational renewable energy ‘target’ appeared to match up pretty closely with independent assessments of the renewable energy projects that were being planned in that state and how much electricity they’d generate. In other words the South Australian renewable energy target might be best viewed as a prediction, not a target.
Why am I going into the policies of a Government that has been turfed out in detail? Because in the run-up to the election the Labor Government set a renewable energy target of 75 per cent for 2025. That likely means that Labor is expecting the state to go nearly 75 per cent renewable within the next 7 years. Time to take a deep breath.
The Marshall Government has inherited one of the world’s most complicated electricity systems. South Australia has always had the peakiest demand profile, based on its weather patterns, buildings and early love affair with air conditioners. It also has an extraordinarily spread out grid. Network costs in the Adelaide region are comparable to other states, but outside the metro area the costs per connection are extraordinarily high. It has poor quality coal (and now no coal-fired generator) and relies heavily on a few gas-fired generators at a time when domestic gas prices are through the roof.
Based on pure economics, building new fossil-fuel generators is not the answer to the State’s problems. They’ll need to deal with the peak by improving energy efficiency and marshaling demand response (sorry, I couldn’t resist). They’ll need to deal with network costs through energy management and a shift to more localized resources and micro-grids in the regions. They’ll need to deal with a whole slew of issues around energy storage and peaking generation while avoiding the sort of gold-plated techno-fetishist tendencies of the last government. They’ll need a whole slew of changes to rules and regulations.
South Australia is at the cutting edge of the world’s energy systems. It appears that the Marshall Government knows this, and they made a significant commitment to demand response in the run up to the election. But they’ve also left many of their options open, including on the State’s existing energy efficiency policies. The next year will see a blistering rate of policy development in South Australia.
The new Minister for Energy and Mining, Dan van Holst Pellekaan has probably just won the most exciting and terrifying job in the country. We met with his office before the election and will be engaging more in coming weeks and months to explain the importance of existing policies and how to use energy management to deliver cheap, reliable capacity to South Australia.
In the words of South Australia’s most poorly thought-out tourism campaigns, the EEC, and the world, is “Going all the way with SA”.
National Energy Efficiency Forum
Date: Monday 21 May 2018
Time: 11.45am – 2.30pm
Location: The Events Centre – Collins Square, Melbourne
Click here to view speaker biographies and pricing details.
Our energy market is transforming, and in this rapidly changing landscape demand side resources like energy efficiency and demand response are becoming increasingly crucial. However truly unlocking the demand side opportunity will require new rules, new business models and a new commitment to delivering for consumers.
The Energy Efficiency Council is pleased to announce a lunchtime Forum featuring a keynote address from Audrey Zibelman, CEO of the Australian Energy Market Operator (AEMO), on Monday 21 May 2018 in Melbourne.
Audrey Zibelman, Managing Director and Chief Executive Officer, AEMO
Audrey Zibelman leads AEMO, the independent gas and electricity system and market operator in Australia, an organisation that has primary responsibility for managing and maintaining energy system security for all Australians.
Audrey has extensive experience in the public, private and not-for profit energy and electricity sectors in the United States, most recently having held the positions of Commissioner and Chair of the New York State Public Service Commission (NYPSC). During her tenure at the NYPSC, Audrey led the design and implementation of extensive regulatory and retail market changes to modernise and transform the state’s electricity industry.
Audrey will be joined by a panel of experts to discuss what Australia can learn from energy efficiency leadership in the US and around the world.
Key questions canvassed at the Forum will include:
- What are the implications of the advent of sophisticated forms of energy efficiency and demand response for traditional energy markets?
- What can we learn from overseas markets that are navigating a similar pathway towards smarter, more flexible energy use?
- What are the learnings from the demand response trials conducted by AEMO and ARENA in NSW, Victoria and South Australia?
- Will the various energy market reform processes currently underway unlock the potential of demand side resources?
This high profile luncheon will be followed by networking drinks with executives and dignitaries.
The Trans-Tasman Business Circle and the Energy Efficiency Council are delighted to invite you to join us on a delegation focused on Californian leadership in the global energy transition.
The Mission, which will have a particular focus on energy efficiency, demand response and low carbon generation, is open to Australian organisations across both private and public sectors.
This delegation, led by Energy Efficiency Council CEO Luke Menzel, is an excellent opportunity for leaders across business, government, utilities and infrastructure to gain an understanding of California’s world leading energy eco-systems, emerging trends, and to establish key bilateral relationships.
This Mission also coincides with the highly anticipated Global Climate Action Summit being held in San Francisco, California from 12-14 September 2018.
Australia’s energy challenges are not unique. Learn from the leaders in the energy transition.
Energy costs have risen rapidly in recent years, and concerns around carbon continue to grow. These challenges aren’t unique, but rather are being felt around the world. California is thriving in the midst of the transformation of their energy system, building on over four decades of innovation in energy policy and technologies.
Crucially, Californian businesses and government are taking a balanced approach – driving a rapid transition to low carbon generation, while quickly ramping up energy efficiency across the economy. This means that while the unit cost of energy is high by US standards, bills for businesses and households are low because Californians don’t waste energy. This balanced approach keeps costs down while cutting carbon emissions and is becoming the model for energy transition for other advanced economies around the world.
Learn how California is innovating their way to a sustainable energy future across all parts of their economy.
- Learn how California’s innovation ecosystem is driving the state’s energy transition
- Meet with energy experts and leaders from California’s business, government and not-for-profit sectors
- Visit the facilities driving California’s energy technology boom
- View world leading applications of advanced energy technologies in buildings and manufacturing.
Date: 10 – 14 September 2018
Cost: A registration fee of $5,500 USD applies, which covers the following:
- Full program from 10 – 14 September 2018
- All ground costs including transport and meals included in the official group programme
(Please note that the registration fee does not include transfers, accommodation costs, international and internal airfares, and local travel undertaken on a private basis or travel for individual meetings whether or not accompanied by TTBC staff).
For further information and to register your interest, please contact the Tour Director, Tracy Jennings - Tracy.Jennings@buscircle.com.
Throughout 2018 Energy Efficiency Council are offering a comprehensive program of training and workshops on M&V, auditing, gas efficiency and metering.
Scheduled programs include:
Adelaide, 29 May 2018
Recent, rapid and significant increases in gas prices mean more businesses are seeking to manage their energy costs through gas efficiency and fuel switching than ever before. Position your business to meet this emerging market demand by attending this one day workshop developed in collaboration with the NSW Office of Environment & Heritage.
Melbourne, 14 June 2018
Presented in partnership with the NSW Office of Environment & Heritage, the EEC's Energy Auditing to the Australian Standard training program gives energy audit practitioners the skills and knowledge to deliver energy audits that meet with Australian Standard 3598:2014.
Sydney, 8 – 10 May 2018
The Energy Efficiency Council is the only Australian provider of the Efficiency Valuation Organization’s ‘Certified Measurement & Verification Professional’ training and exams, delivered in partnership with the US Association of Energy Engineers (AEE) and the Efficiency Valuation Organisation (EVO).
Also back by popular demand: advanced Applied Measurement and Verification training, with US trainer Steve Kromer.
Check out our full program online to see what's happening in your city!
The City of Melbourne is currently working alongside Sustainability Victoria to help raise awareness of a financial incentive program currently available to you.
Sustainability Victoria are offering up to $30,000 to commercial building owners, agents, tenants and facility managers in Victoria who are keen to identify and implement energy efficiency upgrades that lead to an improvement in building performance. The program can include commercial buildings such as offices, hotels, retail and data centres, and some mixed use buildings.
If you think there are energy efficiency opportunities in your building that you would like to unlock, we would like to arrange a meeting with you and/or the building owner, building manager, facilities manager or any other representative and staff from Sustainability Victoria and Melbourne City Council to discuss this opportunity in more detail.
Both strategies focus on accelerating net zero emissions buildings through environmental ratings, capacity building, retrofits and renewable energy. They also outline the opportunities for connection to recycled water and for improved waste management.
Sydney’s Sustainable Office Building Plan calls on building owners and tenants to reap the benefits of efficient buildings running on renewable energy. Innovation and improvements by sector leaders need to be reproduced by others in the sector, especially building tenants.
The Making Sydney a Sustainable Destination plan sets a vision for Sydney to be recognised globally as a sustainable destination. The strategy identifies opportunities for accommodation and entertainment owners and operators, event organisers, developers and government agencies to improve the sector’s energy and water-intensive operations and take advantage growing demand for sustainable tourism and business travel destinations.
The draft strategies are open for public comment until 17 April 2018.
Australian Energy Week 2018
8 - 11 May 2018
Melbourne Convention and Exhibition Centre | Australia
ALL THE BIG ISSUES. ALL THE KEY PLAYERS. ALL UNDER ONE ROOF.
Australian Energy Week is the major annual event for the stakeholders from the entire energy supply chain, from right across Australia.
Bringing together over 500 industry executives from over 200 companies from every part of the energy value chain, Energy Week is an unparalleled opportunity to network and learn.
In 2018, Australian Energy Week will once again have dedicated streams relevant to all parts of the value chain including generation, retail, networks, emerging technologies, policy and gas.
Energy Efficiency Council CEO Luke Menzel will be chairing the demand response and productivity stream on Thursday 10th May. Joining him will be Head of Policy Rob Murray-Leach who will be giving an overview of the opportunities presented through better energy management.
Other keynote speakers at the event include:
- The Hon. Josh Frydenberg, MP Minister for Environment and Energy, Australian Government
- Audrey Zibelman, Chief Executive Officer, Australian Energy Market Operator (AEMO)
- Kerry Schott AO, Independent Chair, Energy Security Board
- Richard Gross, Chief Executive Officer, Ausgrid
- Elisabeth Brinton, Executive General Manager New Energy, AGL Energy
- Timothy Rourke, Chief Executive Officer, CitiPower & Powercor
- John Pierce, Chairman, Australian Energy Market Commission
- Jo Evans, Deputy Secretary Climate Change and Energy Innovation, Department of Environment and Energy
- Merryn York, Chief Executive Officer, Powerlink
- Stephen Davy, Chief Executive Officer, Hydro Tasmania
For more information download the event brochure here
Or visit the website: www.energyweek.com.au
We are pleased to offer a 10% discount to EEC members – use discount code EEC when booking.
Book online here or call +61 (0)2 9977 0565.
The Summit is the largest climate change and business event in Australasia and will bring together national and international leaders from business, government, technology and finance for knowledge exchange and commercial interaction.
Click here for the full Summit Program.