This Regulation Impact Statement (RIS) considers changes to the energy efficiency regulations for air source air conditioners that
use the vapour compression refrigeration cycle (refrigerative air conditioners).
The Equipment Energy Efficiency (E3) program applies Minimum Energy Performance Standards (MEPS) and Energy Rating Labels (labels) to a range of air conditioners sold in Australia and New Zealand.
These regulations have promoted the development and adoption of energy efficient air conditioners in Australia and New Zealand. There is scope, however, to improve the energy efficiency of air conditioners sold in both countries by removing the shortcomings with the regulations, which have not kept pace with technology and changes in the market.
The objective of the proposed government action is to resolve issues with the regulations that impede the supply and purchase of energy efficient or effective air conditioners. Without government action, these market distortions and unnecessary costs would continue. Resolving the issues would also contribute to government objectives to improve energy productivity and reduce greenhouse gas emissions.
Three policy options (Options A, B and C) have been identified to resolve these problems. The options bring together seven policy proposals. The proposals have been grouped so that they progressively involve more intervention in the market. Option C is the preferred option. It is estimated to provide the largest net benefit in Australia and New Zealand, and would also provide the largest energy and greenhouse gas emission savings.
The main implementation risk from the proposals is suppliers having insufficient time to adjust to the proposed new regulations. This could affect the availability of products, market competition, or compliance with the new regulations. This risk has been mitigated by having different start dates for the proposals, taking into account the amount of time suppliers would require to adjust.