Water heating, space heating and cooling, weather sealing and home energy rating assessment updates

22 May 2023

The Department of Energy, Environment and Climate Action released the Victorian Energy Upgrades (VEU) Specifications 2018 - Version 15.0 on 18 May 2023. This follows the making of the Victorian Energy Efficiency Target Amendment (Electrification and Home Energy Rating Assessment) Regulations 2023 on 18 April 2023.

These amended instruments result in changes to:

• water heating activities (activities 1 and 3)
• space heating and cooling activities (activities 5, 6, 7, 9, 10 and 23)
• weather sealing activities (activity 15)

and introduce a new home energy rating assessment activity, commencing 31 May 2023.  

A summary of the amendments for each activity are listed below. 

Changes to water heating and space heating and cooling activities

Water heating activity (activities 1 and 3) changes

From 31 May 2023

• New greenhouse gas (GHG) reduction calculations and product efficiency requirements for electric boosted solar water heaters and heat pump water heaters to be tested and modelled to AS/NZS 4234:2021.
• Introduction of new activities (activities 3C and 3D) that incentivise the replacement of inefficient gas water heaters with efficient electric boosted solar or heat pump water heaters
• Introduction of pre-installation sizing requirements for residential premises (activities 1C, 1D, 3C and 3D).  These new requirements only apply to installations of water heaters tested and modelled to AS/NZS 4234:2008 from 1 July 2023. 
• Introduction of amended decommissioning requirements and new disposal requirements (all activities 1 and 3)
• Introduction of a new installation limit of five upgrades for non-residential premises (all activities 1 and 3)
• Introduction of a new rule preventing premises built within the past two years from being eligible for water heating upgrades (all activities 1 and 3)
• Clarification that multiple water heaters are not permitted to be installed in-line (manifold systems) (activities 1C, 1D, 1F, 3B, 3C, 3D).

From 1 July 2023

• Removal of activities incentivising the installation of gas-fuelled water heaters (activities 1A, 1B, 1F and 3B) from the VEU program.
• New GHG reduction calculations to apply for installation of water heaters tested and modelled to AS/NZS 4234:2008 (1C and 1D) from 1 July 2023 to 30 June 2024.  Existing GHG reduction calculations to apply for these installations to 30 June 2023. 

From 1 July 2024

• Inclusion of a new refrigerant global warming potential (GWP) threshold for heat pump water heaters (activity 3C).

Space heating and cooling activity (activities 5, 6, 7, 9, 10 and 23) changes

From 31 May 2023

• Introduction of new space heating and cooling activity (activity 6) to incentivise installation of high efficiency reverse cycle air-conditioners (ducted and non-ducted).
• New GHG reduction calculations and product efficiency requirements for reverse cycle air-conditioners to be registered to the Greenhouse and Energy Minimum Standards (Air Conditioners up to 65kW) Determination 2019 (Cth) (GEMS 2019 Determination) (activity 6)
• Introduction of the requirement for products to be listed on our Register of Products to be eligible for the VEU program (in addition to being registered to the GEMS 2019 Determination) (activity 6).
• Introduction of pre-installation sizing requirements for residential premises (activity 6).
• Introduction of amended decommissioning requirements and new disposal requirements (activity 6).
• Introduction of new installation limits (activities 5, 6, 7, 9, and 10).
• Introduction of a new rule preventing premises built within the past two years from being eligible for upgrades involving decommissioning of products (activity 6).
• Inclusion of a new refrigerant GWP threshold for reverse cycle air-conditioners below 15kW in size (activity 6).

From 30 June 2023

• Removal of evaporative coolers upgrade (activity 23)
• Removal of gas space heating upgrades (activities 5 and 9)
• Removal of air-to-air heat pump upgrades (activities 7 and 10), with these activities being consolidated into activity 6.

Changes to weather sealing activities (activity 15)

The regulations have been amended to limit the undertaking of weather sealing activities to residential premises where a flueless gas space heater or open-flue gas appliance is not installed. These amendments come into effect from 31 May 2023. 

New training requirements

A training module: Weather Sealing Safely with Gas Appliances has been developed to provide installers with the skills and knowledge to be able to undertake weather sealing activities in compliance with the VEET Regulations. 

Installers who have completed the VU23076 unit (or previous equivalent VU units - VU21858 and VU21859) prior to 31 May 2023 will need to complete the new training module by 31 July 2023 in order to continue to undertake weather sealing activities under the VEU program after 1 August 2023.

Licensed electricians, licensed plumbers (except those licensed to undertake gas fitting work, Type A appliance conversion work and/or Type A appliance servicing) and registered builders are also required to complete the training module: Weather Sealing Safely with Gas Appliances by 31 July 2023 in order to continue to undertake weather sealing activities under the VEU program after 1 August 2023. 

Additionally, accredited persons will have to submit the training module certificates for their weather sealing installers to us via the VEU registry by 31 July 2023 to allow installers to undertake weather sealing activities under the VEU program after 1 August 2023.

The training module will be integrated in the delivery of the VU23076 unit from 31 May 2023.  Therefore, any installer who completes the VU23076 unit after 31 May 2023 will not need to complete the training module as a separate requirement. 

Registration for the training module will be available via the Green Business Audit & Training website from 31 May 2023.   

New home energy rating assessment activity (activity 45)

The home energy rating assessment activity will be introduced into the VEU program from 31 May 2023. Assessments undertaken in homes using the Residential Efficiency Scorecard Assessment tool by accredited Scorecard assessors will be eligible for Victorian energy efficiency certificates (VEECs) under the program from this date. The assessment must be undertaken in compliance with the agreements and requirements under both the Scorecard program and the VEU program.

You will be able to apply to become accredited for the home energy rating assessment activity from 31 May 2023.

Updated program documents and forms

Program participants, in particular accredited persons and scheme participants involved in the delivery of water heating and space heating and cooling activities under the program should review the VEET Regulations and VEU Specifications to prepare for the changes to the activity.

Updated guidance documents and forms (including VEEC assignment forms and accreditation forms) to support the commencement of the above legislative amendments will be available on the commission website on 31 May 2023.

Early release of product guide and VEEC creation forms

We have updated the Application Guide for Product Applicants and the Water Heating and Space Heating and Cooling Product Application Guide. Those updates will take effect on 31 May 2023, but are being published in advance to assist product manufacturers and other stakeholders to prepare product applications for submission from 31 May 2023.

We have also released updated VEEC creation forms for the water heating activity (activities 1C, 1D, 3C and 3D), space heating and cooling activity (activity 6) and weather sealing activity (activity 15). These forms are required to be used to claim VEECs for activities undertaken from 31 May 2023.