Proposed changes to the Energy Savings Scheme Rule and Regulation
We have proposed changes to the Energy Savings Scheme Rule of 2009 (ESS Rule) and Electricity Supply (General) Regulation 2014 (ESS Regulation). Before making the changes, we consulted industry for feedback. Our public consultation was open from 4 March 2025 and closed on 4 April 2025.
Thank you to those who made submissions. We are reviewing your feedback and will share an update in mid-2025.
Learn more about the proposed changes in our consultation paper.
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If you have questions please contact us at [email protected]
About the Energy Savings Scheme
The Energy Savings Scheme (ESS) aims to deliver cost-effective energy savings for NSW households and businesses by providing financial incentives to install energy-efficient equipment and appliances. The Energy Savings 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 Energy Savings 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 Energy Savings Scheme has supported projects that will deliver 57,000 gigawatt hours (GWh) of energy savings over their lifetime. As of December 2023, the Energy Savings Scheme has reduced greenhouse gas emissions by around 27 megatonnes (Mt). This is the same as the carbon 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 (ESC). 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.
Find out more about the Energy Savings Scheme.
The current Energy Savings Scheme Rule
The current Energy Savings Scheme Rule was published on 24 May 2024 and commenced on 19 June 2024. It includes transition arrangements for creating Energy Savings Certificates using the previous Energy Savings Scheme Rule.
We made key changes, including:
- suspending incentives for the new refrigerated cabinet activity
- amending both refrigerated cabinet activities to reduce lifetime savings and removing incentives for 4-sided display cabinets
- aligning the high-efficiency pool pump activity with the Peak Demand Reduction Scheme (PDRS)
- updating the energy savings methodology for the air conditioners for business activity
- creating new baselines and calculations to ensure energy savings from residential and small business hot water systems better reflect real-world savings
- adjusting the co-payments for residential hot water and adding new co-payments for residential air conditioning and commercial hot water heaters
- making administrative improvements.
These 2 position papers provide more detail on this May 2024 Rule change:
Incentives for energy-efficient upgrades
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.
Email us to learn more about and get involved in our research and consultation at [email protected]