EEO Program U pdate

1. EEO Program Update Dominic Zaal, Manager, EEO Program Department of Resources, Energy and Tourism

2. Program Overview • Program intent and current status • Results and opportunities • Full Cycle Evaluation • Evolution • Future Directions

3. EEO Program Intent to address information failures within business that impede decision making on cost effective energy savings opportunities to build industrial capability and capacity to identify, assess and implement energy saving opportunities to improve energy productivity to enable cost savings to facilitate ongoing/systemic behavioural change in organisations

4. EEO Program - Current Status • Over 300 companies registered, representing over 60% of Australia’s total energy use • Inclusion of electricity generators from 1 July 2011 • Exemption for electricity and gas transmission and distribution networks extended • Extension to include new development and major expansion projects from 1 July 2013

5. Reported Energy Savings 164 PJs in identified savings 89 PJs in adopted savings 5.4% energy savings 1.5% of emissions net financial benefit of over $800m Source: Reported energy saving results, 2010-11

6. Key insights from the first cycle • Analysis of data • Leadership support • Embedded energy efficiency culture and processes • Business case linked to key business drivers • Communication of successful projects

7. Full Cycle Evaluation – Objectives • Objectives were to examine the EEO Program’s • Effectiveness in achieving its stated purpose • Appropriateness compared to other Government policy and measures • Level of efficiency in terms of applied program funding • Formed part of the COAG Complementary Measures Review • Analysed EEO Program materials, reported results and conducted an internet survey and detailed interviews.

8. Full Cycle Evaluation – Findings • effective in addressing information type market failures • hadfacilitatedimprovementinenergymanagementpractices,particularly data analysis, opportunity identification &decision making • complementary to a carbon price in that it addresses market failures not addressed by a carbon price (information vs. price externalities) • enabled benefits to industry that were additional to what would have been achieved in the Program’s absence • efficient in terms of the results enabled for the expenditure

9. Full Cycle Evaluation – Recommendations • Complete the second full EEO Program cycle. • Improve the flexibility with which corporations meet compliance requirements, including alternative compliance mechanisms. • Provide greater clarity on required compliance requirements and which aspects are flexible and open to negotiation. • Improve outcomes and reduce compliance burden through whole of government approach to policy, streamlining of compliance obligations and harmonisation of reporting methods.

10. EEO Program Evolution • Amending EEO regulations to: • Improve flexibility and adaptability • Move towards an outcomes based approach • Allow for better alignment with existing business processes • Recognise continuous high performing energy management • Streamlining of data reporting • EEO module for online data reporting

11. EEO Capacity Building Recent • Energy Savings Measurement Guide – Version 2 • Guidance Documents • construction • EEO website update • EEX website • Newsletters Current and emerging • Systems optimisation • Case studies • Systems optimisation • Commercial and Services • Transport • Significant opportunities register • Revised program materials Industry support officers

12. Future directions • Factors that influence investment energy efficiency • Targeted sectoral capacity building advice and information • Energy productivity • Systems optimisation • Data analysis – to support better understanding of cost effective technologies / practices • International engagement