Victorian energy retailers surrender over 6.2 million certificates to offset energy emissions in 2023

Victorian energy retailers have surrendered over 6.2 million energy efficiency certificates to offset emissions generated by their energy sales in 2023.

Most energy retailers must acquire and surrender certificates created for energy efficient upgrades under the Victorian Energy Upgrades (VEU) program to offset emissions generated by their energy sales. Each certificate represents one tonne of greenhouse gas emissions saved. 

28 energy retailers met their energy liability in 2023, achieving 95 per cent of the total certificate surrenders required to meet the energy liability across all retailers for 2023. 

Three energy retailers have paid penalties after failing to meet their 2023 energy liabilities. The penalties include $28 million to Engie, $905,000 to Iberdrola Energy, and $949,000 to Iberdrola Holdings. 

The Victorian Government recently announced its intention to change the program rules to give energy retailers more time to acquire certificates. 

Essential Services Commission Chairperson Gerard Brody says the penalties are an important reminder to energy retailers of their legislated obligations to do their bit to reduce greenhouse gas emissions. 

“It is pleasing to see the vast majority of energy retailers have fulfilled their obligations for 2023, which is important to the operation of the VEU program,” Commissioner Brody said. 

Since it began in 2009, the VEU program has led to millions of inefficient energy products being replaced in Victorian households and businesses. 

This has reduced greenhouse gas emissions and delivered energy bill savings to Victorian households and businesses. 

The certificate shortfalls and penalty amounts are as follows:

About the Victorian Energy Upgrades program

The Victorian Energy Upgrades (VEU) program helps Victorians reduce their energy bills and greenhouse gas emissions by providing access to discounted energy efficient products and services. The program also encourages investment, employment and innovation in industries that supply these products and services. 

Large energy retailers are required to acquire and surrender Victorian energy efficiency certificates (VEECs) to meet annual targets set in Victorian legislation. ‘Accredited persons’ that carry out eligible upgrade activities by installing energy-efficient products in residential or non-residential premises can create VEECs. 

The greenhouse gas savings associated with the installation of an energy efficient product and/or decommissioning of an inefficient product determines the number of VEECs that can be created. The level of incentive or discount received by households and businesses varies depending on the market activity and certificate price.