The Victorian state government has decided to stop making loans to departments to upgrade their energy efficiency in a decision that experts say will severely compromise a scheme that would save $2 billion in energy costs.
The decision by the Napthine government, and the office of the assistant treasurer Gordon Rich-Philips came despite protests from the energy efficiency industry – and it will radically cut back the Greener Government Buildings (GGB) Program.
Industry representatives say it will likely result in hundreds of job losses, devastate the industry and damage the Victorian budget (with potential lost savings of $2 billion over 25 years). All this, apparently, to $13 million this year, and about $8 million per annum when (and if) the carbon price floated.
The energy efficiency industry suggests that changing the energy efficiency program will cost the health sector well over $21 million a year. Ironically, the GGB Program won the Premier’s sustainability award just two years ago, when the government said the scheme could save $2 billion in savings over 25 years, and cut the government’s own greenhouse gas emissions by around 30 per cent.
“The Assistant Treasurer’s decision to cut back the Greener Government Buildings Program will cause devastating job losses and damage the Victorian budget. This decision is economically reckless and financially irresponsible,” said Rob Murray-Leach, CEO of the Energy Efficiency Council.
“It is shocking that the government would make a decision that would both damage a fragile economy and cost the budget $2 billion. The Government’s stated rationale for the decision suggests they don’t understand the difference between a loan and a grant.”
“Jobs have already been lost because of this decision. More jobs will be lost, with some of our members being forced to cut up to 70 per cent of their Victorian staff.”
“Upgrades to schools and hospitals around Victoria, including in Frankston, Monash, Footscray and Geelong have now been put on indefinite hold. Communities around Victoria will lose out.”
Victoria’s energy efficiency initiatives have been under attack because of push-back from large generators, who fear the declining trend in consumer demand (as a result of more efficiency and new technologies such as solar PV), will break their business models.