The initiatives in this Act will affect electricity retailers, providers of energy and small to medium size energy users.
What do you need to do?Under the Smart Energy Savings Program, the first baseline year for which participating businesses have obligations under the Act is the year commencing 1 July 2009. If you are an electricity retailer, investigate ways to increase your acquisition of eligible gas-fired electricity to satisfy the 15% threshold in 2010.
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Authors
Matthew Austin
Clare Johnson
The Clean Energy Act 2008 (Qld) was introduced into the Queensland Parliament on 29 April 2008 and passed on 14 May 2008. The primary purpose of the Act is to introduce the Smart Energy Savings Program and to amend the Electricity Act 1994 to increase the 13% Gas Scheme annual liability for electricity retailers to 15% by 2010 and progressively to 18% beyond 2010.
These initiatives are key elements of the State’s Climate Smart 2050 Policy released in June 2007. The substantive amendments introduced by the Act await proclamation before they take effect.
Smart Energy Savings Program
The key operating provisions under the Act giving effect to the Smart Energy Savings Program are noted below.
Participating Business
A “participating business” is a person who operates a business that uses more than 10 terajoules but less than 500 terajoules of energy in the most recently completed baseline year and who is not registered or required to be registered under the Energy Efficiency Opportunities Act 2006 (Cth).
A government owned corporation under the Government Owned Corporations Act 1993, other than a GOC issued with a generation authority under the Electricity Act 1994, will not be a participating business under the Act.
There is also provision for businesses who do not meet the minimum energy use thresholds to be captured by the scheme if they receive a notice from the Regulator that they qualify as a “participating business”. The Regulator is the chief executive of the Department of Mines and Energy.
Energy Use Thresholds
The Act proposes level 1, 2 and 3 energy use thresholds, being:
- for the baseline year ending on or after 30 June 2010, level 1, 100-500 terajoules
- for the baseline year ending on or after 30 June 2011, level 2, 30-100 terajoules
- for the baseline year ending on or after 30 June 2015, level 3, 10-30 terajoules.
Obligations on Energy Providers
An energy provider must give the regulator the name and address of any customer the energy provider has supplied with 10 terajoules or more but less than 500 terajoules of energy at the site of the customer, in a financial year. The maximum penalty for failing to comply is 200 penalty units. An “energy provider” is defined widely and includes holders of specified authorities under the Electricity Act 1994, the Gas Supply Act 2003 and the Petroleum and Gas (Production and Safety) Act 2004.
Smart Energy Savings Register
The Regulator must keep a register of participating businesses. It is an offence for a participating business that may be registered to not apply for registration. It is possible for a business to be exempted from registration in defined circumstances.
Energy Audit
A registered participating business must carry out an energy audit within 12 months of the end of each baseline year. The yet to be released Clean Energy Regulations will provide for the content of an energy audit. It will be an offence not to carry out an energy audit.
Energy Savings Plan
A registered participating business must submit a 5 year energy savings plan to the regulator within 12 months of the end of each baseline year. An energy savings plan must set out the measures the participating business intends to implement from the energy audit, being efficiency, conservation and management measures, and how the participating business intends to implement those measures.
The participating business must review its energy savings plan in its third financial year and provide a report to the regulator on how it has been implemented and the results of that implementation. Certain information about an Energy Savings Plan is required to be publicly notified. There are a number of offences relating to Energy Savings Plans.
Amendments to the Electricity Act 1994
The Act also makes amendments to the existing Queensland Gas Scheme under the Electricity Act 1994. The current 13% Gas Scheme requires Queensland electricity retailers to source a minimum of 13% of their electricity from eligible gas-fired electricity produced above the baseline production amount.
The scheme is designed to diversify the State’s energy mix towards the greater use of gas, assist in encouraging the development of new gas sources and infrastructure in Queensland and reduce greenhouse gas emissions from the Queensland electricity sector.
The Act maintains the 13% mandatory annual liability under the scheme for 2008 and 2009, increases the liability to 15% in 2010, and increases the liability to not more than 18% for any year after 2010.