Industry Greenhouse Program

Improving energy efficiency for Victorian business

One of the main human activities that contributes to the greenhouse effect is the use of energy. This is because our energy is largely derived from the combustion of carbon-based fuels, such as coal, oil and gas, which results in the discharge of carbon dioxide into the atmosphere. Using energy more efficiently means that fewer greenhouse gas emissions are generated for the same amount of work done. A number of government programs aim to improve the efficiency of energy use in various sectors, including the industrial, commercial, residential and transport sectors.

EPA is committed to working with businesses to use energy more efficiently and reduce greenhouse gas emissions.

The EPA Industry Greenhouse Program, a significant initiative under the Victorian Greenhouse Strategy, commenced in 2002. The program applies to EPA licence holders and works approval applicants. It aims to improve energy efficiency and reduce the associated greenhouse gas emissions, as well as improving the management of greenhouse gases that are not associated with energy usage.

The program's statutory requirements are enacted through the State Environment Protection Policy (Air Quality Management), with details contained in the Protocol for Environmental Management (Greenhouse Gas Emissions and Energy Efficiency in Industry). Industry was assisted in complying with the program by the preparation of the Energy and Greenhouse Management Toolkit.

The implementation of improvement actions under the program has almost been completed, and a report on the program outcomes ( PDF file, 529 KB) has now been released. The key program outcomes include significant benefits to business such as lower energy bills, increased operating efficiency and profitability, and improved environmental performance including significant greenhouse gas emission reductions.

Significantly, financial feasibility criteria for energy efficiency requirements have meant that businesses will save money in the short to medium term, with an average payback period of 20 months achieved overall. In many instances projects are paying for themselves within months.

Under the program, EPA licensees that are medium to large energy users were required to:

• review their energy bills (electricity, gas, LPG, diesel, briquettes, etc.) to calculate their energy use and associated greenhouse gas emissions; greenhouse gases produced by an industrial process (such as chemical manufacture or water treatment) were also calculated
• conduct an energy audit to Australian standards
• identify best practice options and determine payback periods
• prepare an implementation plan for items with a payback of three years or less
• report on implementation and annual emissions as part of annual reporting to EPA.

Businesses applying for an EPA works approval or a new EPA licence have been required to incorporate best practice measures for energy efficiency and greenhouse gas management, using the financial feasibility approach.

Simplified requirements exist for low energy users, which have encouraged them to save energy and reduce operating costs.

The Protocol for Environmental Management (Greenhouse Gas Emissions and Energy Efficiency in Industry) explains the requirements in more detail. The Energy and Greenhouse Management Toolkit has been developed to provide guidance regarding compliance with the requirements, and also provides conversion factors and best practice information. EPA's Guideline for applicants - energy and greenhouse ( Adobe PDF file, 86KB) provides more specific guidance about the details that works approval applicants should provide in order to comply with the requirements of the protocol.

Ongoing energy and greenhouse requirements continue to apply to EPA licence holders and works approval applicants. As well as this, new requirements for all large energy and water-using sites are being developed under the Environment and Resource Efficiency Plan (EREP) program.

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Achievements

The EPA Industry Greenhouse Program is serving as a key measure in Victoria's delivery of improved business energy efficiency and greenhouse gas emission reductions.

In February 2006 the report EPA Industry Greenhouse Program – the story so far ( Adobe PDF file, 414KB), outlined the commitments made and the expected achievements of the program.

Following the completion of most program actions, a new report Delivering Business Benefits From Energy Efficiency – the Achievements of EPA Victoria’s Industry Greenhouse Program ( Adobe PDf file, 529 KB) issued in September 2007 has shown that key program outcomes will include:

• an annual reduction in Victoria's greenhouse gas emissions of 1.23 million tonnes of carbon dioxide equivalent
• annual energy cost savings to business of $38.2 million
• an average financial payback period of 20 months
• approximately 25 per cent of total greenhouse gas reductions coming from actions with financial payback of six months or less, with these delivering almost half of the total annual cost savings to industry
• overall energy use reductions equivalent to just over one year’s growth in demand for electricity in Victoria, and about three years for gas, demonstrating that energy efficiency measures can provide a real benefit to the State in helping to defer costs associated with energy demand growth

Under the program some 2436 energy efficiency actions will be undertaken, including:

• 280 industrial/manufacturing process modifications
• 330 plant drive upgrades and replacements
• 370 lighting modifications
• 300 compressed air system improvements
• 420 energy management systems (for example, metering and monitoring of energy).

The report also contains case studies with examples of energy efficiency and greenhouse gas reductions undertaken by companies participating in the program.

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Case studies

The outcomes of the EPA Industry Greenhouse Program show there is significant potential to achieve environmental and economic outcomes simultaneously. The following case studies, taken from the report Delivering Business Benefits from Energy Efficiency – the Achievements of EPA Victoria’s Industry Greenhouse Program ( Adobe PDF file, 529KB) published in September 2007, provide examples of actions that companies have undertaken to reduce energy use and greenhouse gas emissions:

• Alpine MDF ( PDF file, 177KB)
• Bluescope Steel ( PDF file, 166KB)
• Carter Holt Harvey ( PDF file, 185KB)
• Ford ( PDF file, 196KB)
• Godfrey Hirst ( PDF file, 176KB)
• Holden ( PDF file, 196KB)
• Murray Goulburn Co-operative ( PDF file, 189KB)
• Kenworth (PACCAR Australia) ( PDF file, 172KB)
• Toyota ( PDF file, 171KB)

 

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