How can we benefit from the Energy Savings Scheme?
Your participation in the Energy Savings Scheme (ESS) may add tens of thousands of dollars a month in revenues to your business, depending on the quantity and type of electrical appliances you sell.
Many appliances you sell will be eligible to create Energy Savings Certificates (ESCs) under the NSW Government’s Energy Savings Scheme (ESS), Sale of New Appliances Sub-method. In order to participate you’ll need to become an Accredited Certificate Provider (ACP), or you can assign the right to an existing ACP (which is significantly more straightforward.)
We’re an ACP under the ESS and will provide to you a cost-efficient way to access value under the scheme. In this capacity we are a value-added aggregator of Energy Savings Certificates (ESCs) and will carry the costs and risks of your participation in the ESS, in exchange for a service fee.
Simply put, you regularly provide to us sales transaction data and we create Energy Savings Certificates (ESCs), sell them and pay you the proceeds, less our service fee.
Your customer doesn’t need to sign anything, neither do they need to be aware that you have a right to create ESCs for selling an energy efficient appliance. Under the Sale of New Appliance Sub-method of the Energy Savings Scheme (ESS) you are treated as the energy saver, not your customer. They don’t have a right to create ESCs.
We don’t require that you provide to us your customer’s name, phone number or any other personal details. In this way, if you’ve collected a customer’s personal data, it will be “de-identified” before it’s passed to us. We won’t contact your customer and all data you provide to us will be treated in strict commercial confidence.
We’ll clean and validate your data, use it to create ESCs, sell them to liable parties and pay you the proceeds, less our service fee. You boost your revenue, we do all the work; nothing’s simpler.
To act as your nominated Accredited Certificate Provider (ACP) we’ll need you to sign our commercial agreement, which will stipulate the terms of our arrangement, and sign an ACP authorisation form acceptable to the scheme administrator, IPART.
Then on a weekly, fortnightly or monthly basis (you choose), you’ll provide to us a sales transaction data file that includes, at a minimum:
• Sales Invoice Number
• Date of Sale
• Purchaser’s Street Number and Street Name
• Purchaser’s Suburb and State (or postcode)
• Appliance Model Number
• Appliance Brand Name
• Sale amount (excluding GST)
Note: we don’t need your customer’s name, phone or email.
We’ll clean the data you send, correcting addresses where we can, adding in missing data and reformatting as required. Model numbers will be matched to entries in our comprehensive appliance database and all other data required under the Sale of New Appliances Sub-method added in, including size/capacity and E3 energy-star ratings. Any records that are ineligible will be removed. Only when we’re happy that a record is accurate and complete will we use it to create ESCs.
We’ll do all the hard work and carry the costs. All we need from you is a sales transaction data file that includes the data fields indicated and we’ll do the rest. We don’t require that you modify your POS processes or the way your accounts and management information systems capture and store sales transaction data. We’ll adjust our automated processes to match yours. And we’ll clean up and validate your data too.
You don’t need to provide to us your customer’s name, phone or any other personal details. In this way the data you provide to us is “de-identified”. We won’t contact your customer, neither will IPART. We’ll validate your data against publically available databases and with sophisticated data analysis tools and techniques before using it to create ESCs.
Occasionally we’ll need you to provide a stock movement statement for a randomly selected sample of sales transactions. This will allow us to confirm the accuracy of the sales transaction data you have provided.
Oh, you’ll also need to agree to allow an independent auditor, appointed by IPART, to inspect your accounts as they relate to this activity, if requested. This will only be an occasional requirement or may not occur at all. The auditor, who may need to attend your premises, will confirm that the data you supplied to us is the same we used, and that there is supporting documented evidence. They’ll need to see relevant records going back six years, so you’ll need to retain this information in a readily retrievable form, as do we.
We’ll work out whether an appliance sale is eligible and calculate the number of Energy Savings Certificates (ESCs) that can be created; it’s part of our service. As your nominated Accredited Certificate Provider (ACP) we’ll also provide you with a list of eligible appliances and the number of ESCs each creates. Everyone wins if you promote and sell appliances that are more energy efficient.
The ESS Rule 2014 (amendment 2) provides seven categories of appliance eligible to create ESCs under the Sale of New Appliances Sub-method:
• Clothes Washing Machine
• Clothes Dryer
• 1-Door Refrigerator
• 2-Door Refrigerator
• Chest Freezer or Upright Freezer
For an appliance to be eligible under a particular category, specified capacity and MEPS E3 energy star ratings (as well as other conditions) must first be achieved.
Further to this the appliance must be new at the time of sale. This means that the appliance must not have been sold previously. For example, the following do not count as new:
• any appliance that has been returned regardless of whether it was used or not, as the energy savings will have been captured by the original sale
• appliances which have been refurbished by the manufacturer, and
• second hand sales
A factory second is considered new if the appliance is not a refurbished product and defects are cosmetic in nature. Demonstration and floor stock are considered new.
The purchaser also has to be eligible. They must be the end-user of the appliance (that is, the energy saver and not a reseller) and have a NSW address (not just a postal address.) So you’ll need to have collected your customers’ addresses. In many instances the address data you collect won’t be complete or may include small errors. Don’t worry about this. We’ll clean up the data and add in any missing bits we can work out.
Yes, it’s worth participating but the value created for each appliance sold is so low it only works if it’s done on a large scale with as much automation as possible. Using our value-added aggregation service lets you access the scheme and boost you gross margin with very little effort, cost or risk. Only then does it really start to pay.
In order to qualify to create ESCs, an appliance sale must meet the strict performance and capacity requirements laid out in the ESS Rule 2014 (amendment 2) and be sold to a purchaser who is an end-user with a NSW address. In practice this may rule out many of your appliance sales. ESC value has been between as high as $18 recently, though it typically trades lower than this. Those appliances that qualify may create as few as 0.1 of an ESC (say, $1.80 per appliance sold), or as many as 4.1 ESCs (say, $72 per appliance sold.)
It’s worth participating because we’ve already done all the hard work for you. We’ve automated our systems to the extent that management and administration costs are minimised. We’ll do all of your data cleaning, correction and validation so you don’t have to change your POS processes or accounting systems or management information systems. All we need is a regular data dump and we’ll do the rest. Our fee will come out of the money we make selling the created ESCs to liable parities (like electricity retailers) and others. We’ll pay you the balance so you won’t ever be out of pocket. We’ve created and sold over two million energy efficiency certificates since 2008 so we know what we’re doing and our network of liable party buyers is well established, allowing us to get top dollar, which is good for both you and us.
So is it worth participating? The short answer is: yes, if you appoint us as your nominated ACP. How much will you make by participating? Well, that depends. You probably don’t collect addresses for all your sales (e.g. televisions that are carried out of the store by the purchaser), but the more you do collect the better. Not all of the appliances you sell will have a high energy star rating, but higher energy star rating appliances generally attract more ESCs than lower energy star rated appliances. And of course, the more appliances you sell the more ESCs you will generate. Some of our other retailer partners are registering tens of thousands a month with little or no effort on their part.
If you send us sample data we can calculate what it will be worth in real dollars. Once we’re underway we’ll provide you with a comprehensive list of appliances you sell that are generating the highest quantity of ESCs. Everyone wins if you steer promotion and sales efforts towards more energy efficient electrical appliances.
Why should you choose us? We are the largest creator of ESCs under the Sale of New Appliances Sub-method, and one of the largest creators of ESCs across the whole of the Energy Savings Scheme (ESS). This gives us significant market presence, and peace of mind for you. We have more choices when it comes to accessing the best buyers and highest market prices for the Energy Savings Certificates (ESCs) we create using your sales transaction data because we can trade more frequently and in larger volumes, and can easily bundle your ESCs with those of our other customer’s to achieve minimum parcel sizes.
We were the first company to be accredited by the scheme administrator, IPART, under the updated Sale of New Appliances Sub-method that commenced in July 2014. Since then we’ve created millions of dollars in value for our appliance retailer customers, and passed with flying colours three separate independent audits required by the scheme administrator, IPART.
The software we’ve designed and built to process and store your commercially confidential sales transaction data has been optimised to maximise the value you will access under the ESS. Sales records that are ineligible because the appliance model isn’t yet listed in MEPS or the delivery address, Australia Post’s postal address file will be automatically re-presented when these databases are next updated. In this way, we will are able to achieve, over time, a higher ESC yield from your data.
Since 2008 we have provided energy efficiency products and services to more than 250,000 customers and created and sold more than 2 million energy efficiency certificates.
We are an Accredited Certificate Provider (ACP) under the ESS. Our Registered Energy Savings Activities (RESAs) include Aggregator Appliance Retailer Sales needed to create ESCs corresponding to your sales of energy efficient appliances under the ESS’s Sale of New Appliances Sub-method. To achieve accreditation we worked closely with the scheme administrator, IPART, and policy makers, including the Office of Environment and Heritage (OEH).
We also operate a large energy efficiency and renewable energy solutions business. Our products include solar PV, LED lighting, insulation, smart controllers, HVAC and refrigeration technologies. Our services include audits and assessments, engineering and design, supply, installation and maintenance.
We have key partnerships with GE, CSIRO, CSR, EcoSmart (NECA) and are an active member of industry associations ABSA, NECA, RAA, MBAV, EECCA, SCA, CEC.
We were recently granted a restricted retail licence to sell electricity in Victoria.
Energy Makeovers is an Australian owned energy services company that provides products and services to help its customers reduce energy consumption and create renewable energy. Customers include businesses, government agencies and home makers.
As good as your sales transaction data is, it will still need to be cleaned, corrected and validated before it’s acceptable for the creation of ESCs under the Sale of New Appliances Sub-method.
The scheme administrator, IPART, has exacting standards for data validation and formatting and the ESS Rule 2014 (amendment 2) lays out strict rules for which appliances and addresses may be used.
Before using your sales transaction data to create ESCs we will clean and correct it for you, using a number of manual and automatic processes, as per below:
• Addresses will be validated and reformatted using rules developed by Australia Post. Any missing components of an address that can be reliably derived from components provided will be added in. Slight spelling errors, incorrect street types and the use of adjacent suburb names will be corrected. Non-physical addresses like post boxes and streets without numbers will be excluded, as will be addresses that aren’t in NSW.
• Your appliance model numbers and brand names will be matched with the MEPS E3 database, which changes daily and contains 10,000 models in the applicable appliance categories. Only models listed in MEPS and that also comply with the performance standards of the ESS Rule can be used to create ESCs.
• Appliances resold by you or by your customers will be identified and excluded, in case they result in the creation of phantom ESCs; that is, ESCs that are created a second time following the resale of a particular appliance. This requires us to maintain a large list of potential reseller addresses, including appliance servicing contractors that may buy from you without your explicit knowledge. We also identify the addresses of landlords and real-estate agents and building developers and others that purchase appliances from you but aren’t the ultimate energy saver. Sales transaction data from these sales can’t be used to create ESCs.
• As per ESS Rule requirements, we identify by address your business customers then record their business categories following a manual internet search. Sales to a business can be used to create ESCs provided the business is the beneficiary of any energy savings that occurs, e.g. a hotel or school or café that uses the appliance. IPART considers that a building owner (e.g. landlord, developer) purchasing appliances may be considered the beneficiary on the basis that they could occupy the building at the date of purchase and therefore use the appliance directly, even though they probably won’t. We’ll work with you to determine purchasers that should be included or excluded.
• We can’t use sales transaction data to create ESCs where you’ve acted as a sales agent for another company; that is, the sale is by consignment. IPART have ruled that the seller is the business that passes title to the purchaser. Only appliances that have been first purchases by you and then resold are eligible to create ESCs. We’ll automatically exclude brands for which you act as a sales agent.
All records that fail the tests described above, and other tests we apply, will be added to an easy-to-use exception report for your review. This will give you the chance to correct any data, enhance your systems and processes, and resubmit records. If we suspect a business we’ve identified in your sales transaction data to be other than the ultimate energy saver, you can provide to us evidence and we will create corresponding ESCs on the next data run. You have until 6 months from the end of the year of sale to resubmit a record to us. But even if you don’t we will regularly re-run your failed records to identify opportunities to create ESCs following quarterly updates of the Australia Post’s Postal Address File (PAF) and the MEPS E3 database, updated by appliance suppliers daily.
By validating and correcting your sales transaction data, accepting manual corrections and re-running previously excluded data, then do we maximise the number of ESCs that may be created, and the value we generate for you under the Sales of New Appliances Sub-method.
Appliances that are sold and returned are not capable of creating ESCs, even if the transaction they belong to hasn’t previously created ESCs, even if the product hasn’t actually been used by a purchaser and is still in the box. Resold appliances are considered not new and therefore cannot be used to create ESCs.
Resold appliances are considered not new and therefore cannot be used to create ESCs. If you put returned as-new appliances back into general stock, like most retailers, and don’t track what happens to them thereafter, and so don’t have any way of indicating in your sales transaction data whether a particular appliance has been previously sold or not, don’t worry. All you have to do is include in your transaction data the reversal, showing the return of an appliance (usually a negative quantity) and we’ll add that to a returns register. When we see the same model of appliance being sold later, we’ll match it up with one previously returned and exclude the record from creating any ESCs that may apply. If you’re able to exclude a resold appliance transaction from future data you supply (e.g. you track stock movements at serial number level or only sell previously returned appliances through a clearance centre or 2nds business) then let us known and we’ll just ignore any negative quantities we see.
In this way we will make sure your data is compliant with the ESS Rule and IPART’s exacting standards for data integrity.
Our service fees, payment terms and other terms are stated in a commercial agreement we will provide to you. As they are commercially confidential we haven’t published them in this document.
Our fees cover:
- Modifying our systems and processes to mesh with yours
- Data cleaning, correction, filtering and validation
- Administration, data entry and auditing
- Certificate registration (currently $0.70/ESC) paid to the scheme administrator, IPART
- Independent auditing costs ($50,000-$100,000 per year)
- Software development and database management
- Account management
We’ll do all you data cleaning, correction and analysis so you don’t have to change your POS processes or accounting systems or management information systems. All we need is a regular data dump and we’ll do the rest.
Our service fee and the certificate registration fee will come out of the money we make selling the created ESCs to liable parities (like electricity retailers) and others. We’ll pay you the balance so you won’t ever be out of pocket.
If you transfer to us the right to create Energy Savings Certificates (ESCs) for the sale of electrical appliances, there’ll be no cost to you for participating in the Energy Savings Scheme (ESS). As your nominated Accredited Certificate Provider (ACP), we’ll carry the costs of your participation, in exchange for a service fee. This includes certificate data processing, registration costs, administration, and the ongoing auditing requirements of the scheme administrator, the Independent Pricing and Regulatory Tribunal (IPART).
If you decide to become an ACP and participate in the ESS directly, you’ll be obliged to meet all of IPART’s requirements and cover the costs of management, administration, certificate registration and ongoing external audits, which can be as high as $25,000 an audit. Penalties for fraudulent or erroneous participation can be as high as $220,000. You’ll also pay commissions if you engage someone to handle the ESC sale process for you.
As your nominated ACP we’ll carry the costs and risks of your participation in exchange for a service fee. We’ll deduct our fee from the proceeds of ESCs as we sell them for you to liable parties, so you’re never out of pocket.
No, we won’t need to audit your sales records but you will need to agree to allow an independent auditor appointed by the scheme administrator, IPART, access if requested. It will happen only occasionally or not at all. They will confirm that the data you supplied to us is the same we used when creating ESCs, and that there’s supporting evidence that the data is accurate. They’ll need to see relevant records going back six years so you’ll need to retain this in a form that’s readily retrievable. If access is required by an auditor, we’ll let you know.
We have the list of independent auditors IPART will choose from when auditing participants in the Energy Savings Scheme (ESS). If you want a copy, let us know.
Also, we’ll need you to provide the occasional stock movement statement for a randomly selected sample of sales transactions. This will allow us to confirm the accuracy of the sales transaction data you have provided.
We’ll do our best to identify every Energy Savings Certificate (ESC) you’re entitled to create under the Sale of New Appliances Sub-method, but we won’t get them all.
In some situations small errors (like the spelling of a street name) in the purchaser’s address you provide will stump our address validation processes. We will compare your address records to a database of 3 million postal records, cleaning up and adding missing fields only when we’re confident there’s a match.
Sometimes the appliance model number you use will be too dissimilar to the corresponding model number in our master appliance database to be correctly matched. We’ll be matching the appliance model numbers in your sales transaction data with 10,000 model numbers in the latest, published MEPS E3 database. There will be instances where you’ve sold a new energy-star-rated appliance that hasn’t yet made it into the E3 database; this we’ll miss on the first pass, but pick up later when the MEPS E3 database is updated.
We’ll also exclude records were there are unexplainable duplications of a particular kind of appliance being sold to the same address (e.g. 2 washing machines) as we’ll presume this is not an end-user purchaser unless you tell us otherwise. Only sales of eligible appliances to end-user purchasers with NSW addresses can be used to create ESCs under the Sales of New Appliances Sub-method.
It’s not the end of the story if we do miss some on the first pass, because we’ll feedback the exceptions to you and give you the opportunity to submit the records again, or provide additional information. We’ll also regularly update our databases, processes and systems and rerun records previously excluded. In this way we’ll maximise the number of ESCs created from your data.
We both have a vested interest in identifying as many ESCs as possible in your sales transaction data so we’ll work closely with you to optimise our processes to capture as many as possible.
There are stiff penalties for breaches to the Privacy Act (Commonwealth) where it pertains to the storage and transmission of your customer’s personal details so we’ve worked hard to design a business model that reduces the risk of breach, and maximises the value you will obtain by participating.
We don’t require that you provide to us your customer’s name, phone number or any other personal details. In this way, if you’ve collected a customer’s personal data, it will be “de-identified” before it’s passed to us. We will only collect from you and pass to the scheme administrator, IPART, your customer’s address, less than what is publically available on the electoral role. The other data we collect and pass on is of a commercial nature only; model number of the appliance, sale date and value, invoice number.
We won’t contact your customer, neither will IPART. We’ll validate your data against publically available databases and with sophisticated data analysis techniques before using it to create Energy Savings Certificates (ESCs). You’ll also provide to us the occasional stock movement report so that we can confirm the accuracy of sales transaction data provided.
We’ll agree only to use the data you provide to fulfil our function as your nominated Accredited Certificate Provider (ACP) and keep all data in strict commercial confidence.
However, we cannot provide you with legal advice. You should seek your own independent legal advice if you have concerns regarding compliance with the provisions of the Privacy Act or any other applicable legislation.
The Energy Savings Scheme (ESS) reduces electricity consumption in NSW by creating financial incentives for individuals and organisations to invest in energy savings projects. Energy savings are achieved by selling, installing, improving or replacing equipment and processes. Energy savers have the right under the ESS to create and sell Energy Savings Certificates (ESCs) or to transfer the creation rights to others.
The ESS is governed by NSW legislation. It places a mandatory obligation on “liable entities” (such as electricity retailers) to obtain and surrender ESCs, which represent energy savings. The development of the policy framework is the responsibility of the Office of Environment and Heritage (OEH) and the Department of Trade and Investment, Regional Infrastructure and Services. The ESS is administered by the Independent Pricing and Regulatory Tribunal (IPART) on behalf of the NSW Government.
The Energy Savings Scheme (ESS) is a NSW Government Scheme legislated to run until the year 2020. In July 2014 the NSW Government expanded the scheme by adding the Sale of New Appliances Sub-method, and other methods; signalling its ongoing commitment to the scheme. In November 2014 and again in May 2015 the NSW Government announced its intention to expand the scheme to include saving made by appliances that burn natural gas. It also announced it would extend the scheme to 2025, raise targets for liable entities, and add a regional factor to energy savings calculations.
The Sale of New Appliances Sub-method provides a way to calculate and create Energy Savings Certificates (ESCs) for the energy savings resulting from the sale of electrical appliances that consume less electricity than the average appliance of the same type.
The method provides appliance retailers an incentive to market and sell higher efficiency appliances to consumers who benefit from the ongoing electricity savings. Unlike other methods under the ESS, the purchaser doesn’t have a right to make and sell ESCs, the right vests instead with the seller of the appliance; you, the appliance retailer.
The Sales of New Appliances Sub-method is a deemed method; that is, future energy savings from an activity are estimated and the savings credited in advance by the issue of ESCs that may be sold to liable parties (such as electricity retailers.)
An Energy Savings Certificate (ESC) is a White Certificate representing the implementation of an energy efficiency activity that offsets the consumption of 1.06 megawatt hours (MWh) of electricity (the equivalent of 1 ton of carbon dioxide emissions.) An ESC is created under the terms of the Energy Savings Scheme (ESS).
ESCs can only be created by Accredited Certificate Providers (ACP) for Registered Energy Savings Activities (RESAs). After implementing a RESA, an ACP is able to create ESCs for each tonne of carbon dioxide (equivalent) saved, or 1.06 times the MWh of electricity saved. These certificates can be traded and sold to liable entities, such as electricity retailers, who have a legislated obligation to surrender a predetermined annual quota.
An ESC is a market tradable energy efficiency certificate created through the Energy Savings Scheme (ESS) by an Accredited Certificate Provider (ACP) on behalf of an energy saver and sold to a liable party, such as an electricity retailer. Liable parties are required by NSW legislation to create or acquire enough ESCs to satisfy an annual quota, currently 5% of electricity sales. In May 2015 the NSW Government announced its intention to raise the obligation to 6.5%.
As the annual demand for ESCs is effectively fixed, the level of supply will have the greatest impact on the ESC price. For a number of months the ESC price has hovered around $14 but recent trades have been as high as $18. It’s not a lot but will quickly add up across thousands of sales transactions.
We will regularly review out ESC price and notify you of changes. The price we’ll pay will be the best price we can obtain, less our service fee.
Four certificate-based energy efficiency schemes currently operate in Australia.
• Victorian Energy Efficiency Target (VEET), Victoria
• Residential Energy Efficiency Scheme (REES), South Australia
• Energy Efficiency Improvement Scheme (EEIS), Australian Capital Territory
• Energy Savings Scheme (ESS), New South Wales
The ESS is legislated to run until the year 2020. In July 2014 the NSW Government expanded the scheme by adding the Sale of New Appliances Sub-method, and other methods; signalling its ongoing commitment to the scheme. In November 2014 and May 2015 the NSW Government announced their intention to expand the scheme to include saving made by appliances that burn natural gas. They also announced they would extend the scheme to 2025, add a regional factor and increase targets for liable entities from 5% of electricity sales to 6.5%.
No. Under the Sale of New Appliances Sub-method, the energy saver is an appliance retailer who sells a high efficiency appliance to an end-user purchaser with a NSW address. The appliance retailer does not need to be located in NSW and can either have a traditional bricks and mortar store or an online store.
Under the Sale of New Appliances Sub-method, the purchaser of an appliance does not need to sign anything, neither do they need to be aware that you have a right to create Energy Savings Certificates (ESCs) for selling to them an energy efficient appliance. Under this method, the ESS Rule 2014 (amendment 2) treats the appliance retailer as the energy saver, not the purchaser. The purchaser doesn’t have a right to create ESCs under this method.
To find out more about how we can help you access value under the Sale of New Appliances Sub-method of the Energy Savings Scheme (ESS), contact:
Business Manager NSW
0437 252 830
Energy Makeovers is an Australian owned energy services company that provides products and services to help its customers reduce energy consumption and create renewable energy. Customers include businesses, government agencies and home owners.
Since 2008 we have provided products and services to more than 250,000 customers and created more than 2 million energy efficiency certificates. We are an Accredited Certificate Provider (ACP) under the NSW Energy Savings Scheme (ESS) and an Accredited Provider (AP) under the Victorian Energy Efficiency Target (VEET). We have key partnerships with GE, CSIRO, CSR, EcoSmart (NECA) and are an active member of industry associations ABSA, NECA, RAA, MBAV, EECCA, SCA and CEC.
We also operate a large energy efficiency and renewable energy solutions business. Our products include solar PV, LED lighting, insulation, smart controllers, HVAC and refrigeration technologies. Our services include audits and assessments, engineering and design, supply, installation and maintenance.
We have recently been granted a restricted retail licence to sell electricity in Victoria.
You can learn more about Energy Makeovers at www.energymakeovers.com.au.