New Energy Security Safeguard Rule changes now in effect
New Rules under the Energy Security Safeguard are now in effect from Wednesday 1 July 2026. These changes affect both the Energy Savings Scheme (ESS) and Peak Demand Reduction Scheme (PDRS).
About the Energy Savings Scheme
The Energy Savings Scheme (the Scheme) aims to deliver cost-effective energy savings for NSW households and businesses by providing financial incentives to install energy-efficient equipment and appliances. The Scheme also incentivises energy retailers and large energy users to reduce their use of fossil fuels.
The Energy Savings Scheme is NSW’s largest energy-efficiency program and is one of the key programs for NSW to achieve net zero emissions by 2050. The Scheme was established in 2009 and will remain operational until 2050 under the NSW Electricity Supply Act 1995, in line with NSW’s net zero goals.
Between 2009 and 2023, the Scheme has supported projects that will deliver 57,000 gigawatt hours (GWh) of energy savings over their lifetime. As of December 2023, the Scheme has reduced greenhouse gas emissions equivalent to around 27 megatonnes (Mt) of carbon dioxide. This is the same as the emissions produced by the NSW transport sector in 2022.
Under the Energy Savings Scheme Rule, we set out targets for energy retailers and large energy users. These targets are met by creating or buying Energy Savings Certificates (ESCs). Energy Savings Certificates are created for eligible activities that reduce energy usage, such as installing energy-efficient appliances. These activities are updated regularly in consultation with industry stakeholders to ensure they remain effective, in alignment with the objectives of the Energy Security Safeguard.
We review the Energy Savings Scheme every 5 years. During the 2020 review we increased the energy savings target of the Scheme by 0.5% each year from 2022, reaching 13% in 2030. The target will then remain at 13% until the end of the Scheme in 2050.
Incentives for energy efficient upgrades
Find out what upgrades are available to make your household more energy efficient and save money.
See what upgrades are available to reduce energy usage and costs for your business.
Current Energy Savings Scheme Rule
The current Energy Savings Scheme Rule was published and came into effect on 1 July 2026.
Before making the changes, we consulted industry for feedback. Our public consultation was open from 17 December 2025 to 20 February 2026.
Changes to the Energy Savings Scheme Rule affect:
- multi-split system and large air conditioner eligibility
- commercial heat pump water heaters
- the lifetime of liquid chilling packages
- air conditioner activity co-payments.
Learn more about the current Rule and previous changes here.
Get involved
We collaborate with industry through research and public consultation. We’ll keep you informed by updating activities regularly on our website and via email.
Sign up to receive updates below, or contact us to learn more about and get involved in our research and consultation.