Background and Methodology

HP Open MindBackground

The Energy Saver Incentive (ESI) scheme is one of the first mandatory energy efficiency target schemes in Australia, its first phase running from 2009 - 2011. Those accredited under the scheme provide incentives to householders undertaking eligible energy efficiency activities. The scheme has been very extensive, involving over 600,000 Victorian households since 2009. The activities that have been taken up by households to the greatest extent have been those involving lighting, heating, hot water, and shower rose upgrades.

In installing/undertaking an activity in a household, accredited persons create a tradeable Victorian Energy Efficiency Certificate (VEEC). Energy retailers then ultimately retire their VEECs to meet their portion of the annual ESI target. Each VEEC represents 1 tonne of lifetime greenhouse abatement, as calculated by assessing the reduction that has been deemed to occur due to the activity (through the Victorian Energy Efficiency Target Regulations 2008). In total, the ESI has set a target for lifetime greenhouse abatement of 2.7 million tonnes of carbon dioxide equivalent per year of the first phase of the scheme.

The Department of Primary Industries (DPI) is involved with government policies and programs that enable Victoria's primary and energy industries to sustainably maximise the wealth and wellbeing they generate. In line with this involvement, DPI provides policy advice to the Minister for Energy and Resources regarding the ESI scheme, which is administered by the Essential Services Commission (ESC).

DPI is currently undertaking an evaluation of the first phase of the scheme. A key part of the evaluation process involves surveys of consumers, accredited persons, and technology manufacturers in relation to their experience of key features of the scheme. The findings from the current research will contribute to the overall evaluation of Phase 1 of the ESI scheme.

Research objectives

The study brings together two separate surveys, of consumers on the one hand, and of accredited persons (APs) on the other, with the broad aim of providing a holistic overview of the experiences of those taking part in the ESI scheme since its inception.

Supporting this overall objective was a number of specific research objectives, namely to:

  • Identify key barriers to consumers undertaking energy efficiency upgrades;
  • Identify key motivations on the part of consumers to undertake activities under the ESI;
  • Explore any additional behavioural impact on energy consumption that may have followed on from the consumers' uptake of ESI measures;
  • Examine the longevity of any changes that resulted from the uptake by consumers of ESI measures;
  • Examine consumers' preparedness to pay for undertaking energy efficiency upgrades under the ESI;
  • Explore potential economic impacts in terms of investment, employment, and technology investments made by APs; and
  • Examine the costs associated with the ESI, including both direct costs to participating consumers and certificate prices faced by APs.

Research approach

As already mentioned, two separate surveys were carried out as part of the study:

  1. Consumer survey. A substantial survey of scheme participants since 2009.
    1. Sample size:We conducted a telephone survey of one thousand people (n=1,000 people) in households which had undertaken activities under the ESI scheme. All respondents were either the person in the household with most involvement with, or personal knowledge of the activity. The sample was split between 4 regions, with n=700 from Melbourne, and between n=91 and 105 for three other regions (Cold regional, Hot regional, and Mild regional). In addition, the sample was originally intended to be split evenly between five activities (light globes, water heating, shower roses, space heating, and ceiling insulation). However, after matching telephone numbers, there was insufficient sample to complete either the space heating or ceiling insulation quotas1, and so the balance was made up by additional interviews in the remaining three activity groups.
    2. Fieldwork:Fieldwork was conducted from 28 July to 7 August 2011. Sample lists of all household addresses at which ESI activity had occurred were provided, and a total of 28,544 of the original 674,568 households were randomly sampled and an attempt made to match a telephone number to the nominated address. Numbers were able to be obtained for 13,207 addresses, or 46% of the total. By the end of the fieldwork period, attempts had been made to contact 4,707 of these sampled households, of which 1,211 had either not been able to be contacted, or were awaiting a call back. Of the 3,496 finalised contacts, 1,000 completed an interview, and 1,410 refused; this represents a satisfactory response rate of 41% of those households who were eligible for interview and who were actually able to be contacted. The remaining 1,086 contacts were unable to be interviewed for a range of reasons, including wrong/invalid telephone numbers (320), the respondent was away for the duration of the survey (78), no-one in the household was personally involved with the ESI activity (82), they claimed to have not had any ESI activity or the activity didn't match the ESI records (107), or they had limited English (351).
    3. Questionnaire coverage: The survey helped us build a solid understanding of:
      1. Motivations to undertake the ESI activity;
      2. Continuing behaviour since the activity;
      3. Overall experience with the scheme; and
      4. Demographic characteristics.
  2. AP survey. A survey of current APs.
    1. Sample size: We conducted a telephone survey of n=50 APs, including n=5 manufacturers, one of which also operates as an AP. In each case we spoke with the person most familiar with the ESI scheme. Participating APs accounted for almost two-thirds of the total of 78 APs.
    2. Fieldwork: Fieldwork was conducted from 29 July to 3 August 2011. In total, 191 separate businesses or individuals who have accounts with the ESI were approached for an interview, and by the end of the fieldwork period, 46 had either not been able to be contacted, or were awaiting a call back. Of the 145 finalised contacts, 50 completed an interview, and 32 refused; this represents a very good response rate of 61% of those businesses who were eligible for interview and who were actually able to be contacted. The remaining 62 contacts were unable to be interviewed for a range of reasons, including wrong/invalid telephone numbers (31), the business claimed not to manufacture or install any of the specified products (17), or the respondent was away for the duration of the survey (10).
    3. Questionnaire coverage: The survey helped us build a solid understanding of:
      1. Drivers and barriers around the ESI scheme;
      2. Impact of the scheme on their business; and
      3. Characteristics of the participating businesses.

A note about the sample structure

Since the scheme's inception in 2009, a total of more than 670,000 households have had ESI activities undertaken; the ESI activities have been heavily concentrated by activity and in time:

  • Low energy lamp installations accounted for 533,504, or 79% of all ESI activities, followed by shower rose installations with a further 106,032 installations, or 16% of all activities;
  • 474,901, or 70% of ESI activities took place in 2009, with a further 188,259 (28%) taking place in 2010.

In designing the sample structure for the consumer component of the research, it was considered highly important that the survey would enable robust comparisons to be made between different activity types, and also between the three years in which the scheme has operated. To achieve this aim, equal quotas were set for each of five activities (energy efficient light globes, water heating, shower roses, heating, and ceiling insulation), and for each of the three years of operation2.

This process effectively skewed the sample composition away from the concentration of activity in 2009 and on lighting and shower rose installations, and towards the later years and the other activities.

Structure of the report

The report is arranged around a number of key themes:

  1. The ESI scheme in context
    • Here we examine the profile of both APs and consumers who have participated in the Scheme in relation to their key business and household characteristics.
    • We also look at the respondents' involvement with the ESI activity and the timing of that activity.
  2. Consumer motivations to participate in the ESI scheme
    • This section examines both the barriers that had previously existed to undertaking energy saving actions, as well as the factors that motivated consumers to undertake ESI activities.
    • Feedback from APs in relation to consumer motivations is considered together with the actual responses from consumers.
  3. Consumer experience since the ESI activity
    • Here we look at the extent to which the installed technology has continued to work, and the impact of having it installed on household patterns of energy usage.
    • We also explore consumer attitudes to energy efficiency more generally, and try to relate this to their experience with the scheme.
  4. Overall consumer experience with the ESI scheme
    • In this section we examine consumers' views on the key benefits and concerns for them that are associated with their participation.
  5. The impact of the ESI scheme on APs
    • Here we explore the economic, employment, and technological impacts of participation in the scheme on APs

1A substantial number of ceiling insulation activities had taken place in "new builds", and the current householder had no involvement in the ESI activity. In addition, the format of some sample records resulted in a very low rate of telephone number matching. For the space heating sample, a lower response rate was achieved than for the other activities, and this meant that insufficient interviews were able to be completed.

2As discussed earlier, there was insufficient sample available to complete the original quota of interviews in relation to ceiling insulation and heating; the unmet quota was reallocated to the other three activities.

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Page last updated: 24/06/20