Page 1914 - Week 05 - Thursday, 3 May 2012
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The next issue we raised was the scheme’s lifespan. The regulatory impact statement covers the first three years of the scheme only. Our concern was that after this period of time the scheme may be stalled by review processes. Our discussions with the directorate revealed that this time frame was chosen to allow flexibility for the scheme to merge with a national scheme, which, if successful, would come into effect within the next three years. A defined time frame was set to provide certainty to industry and to allow for accurate cost-benefit modelling. The requirement that the scheme be reviewed annually will also reduce the risk of problems accruing, which could prompt calls for its closure at the end of the three-year period.
It was also made clear to us that the review at the end of the three years will not be to decide upon the scheme’s continuation but rather to assess its performance and to identify any changes required to streamline its operation. Given the three-year time frame and that ongoing review process, we think that there is plenty of scope to ensure that we do not suddenly get to the end of three years and come to a grinding halt while we have to undertake a 12-month review. These things do seem to take time. Certainly, one thing I have learned in this place is that things never happen as fast as perhaps you might logically expect. We think that there is sufficient scale in this program to ensure that that does not happen.
We considered the issue of the scheme’s starting date, 1 January 2013, and whether that allowed sufficient time for industry in the ACT to adjust, particularly with the introduction of the carbon price and the national energy customer framework from 1 July this year. We considered whether there was too much of a work program there and whether perhaps having insufficient time to prepare would see the retailers end up having to rely on the promotion of low-abatement activities such as whitegoods and power boards as opposed to some of the more substantive measures such as insulation, draught sealing and double glazing, which will deliver deeper and longer term energy reductions.
We did, however, in considering this, take into account that all suppliers will have the final legislation and eligible activities by June, giving them six months to prepare. We also took into account the fact that the energy savings target to be met by the end of the scheme’s first year in 2013 is half of what was required in the second year of the scheme, allowing for the phase-in challenges and, I guess, a ramping up of systems and processes to ensure that the burden on retailers in the first year is one that should be manageable.
The next issue we were concerned about was ensuring that the reductions are delivered within the ACT. We were keen to ensure that the scheme took account of the issue of cross-jurisdictional purchase of eligible products—for example to ensure that a Queanbeyan resident purchasing an energy efficient fridge in Fyshwick would not be eligible to participate. The scheme has been designed so that suppliers cannot claim any credits for abatement outside the ACT. Any consumer purchasing an eligible measure will have to be a customer of the retailer so their residential address will be captured, thereby ensuring that interstate households are not eligible to participate.
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