While it was found that the regulatory burden imposed by the WELS Scheme on product registrants has reduced in recent years and is now broadly acceptable, there are opportunities to further reduce this burden. The time taken to register products is compounded by the need (for some registrants) to undertake two separate processes for products covered under two schemes. On this basis, pursuing the development of common portal with a unified registration process for products covered by one or more related schemes could reduce regulatory burden on industry, as well as administrative costs for government. While implementation of a common portal with a unified registration process would contribute much to reducing the regulatory burden on industry, it should also be noted that other modifications assessed also contribute to this – including a more equitable cost-recovery target, more appropriate compliance and enforcement arrangements, and measures that will reduce the overall cost-base, which lead to lower direct financial costs. A five year product registration cycle has merits based on potential benefits to industry and cost savings for government, but it may be impractical based on the: impact on industry of the of upfront registration fees required risk that registration fee income was not adequate, or WELS Scheme administration could not be sufficiently reduced to provide adequate confidence in its financial sustainability. However, further stabilisation of the WELS Scheme and firming of long-term data on product registration trends should further consideration of this aspect over coming years. On this basis, it is hoped that as the Scheme further matures and the series of modifications found beneficial by this Review are implemented, it will be possible to revisit the prospect of a five year registration cycle before or at the next independent review in 2020. Recommendations The Review makes recommendations focussed on securing current and future benefits while reducing financial costs and regulatory burden to industry and government. They are made cognisant of the fact that the WELS Scheme has recently undergone reform and change. Recommendation 1 The WELS Scheme should be retained – including retaining unchanged: current objects of the Efficiency Labelling and Standards Act 2005 (Cwlth), and thus objectives of the WELS Scheme current of products covered by the WELS Scheme WELS Scheme as a discretely publically-visible consumer advisory scheme – including external public branding and marketing. Recommendation 2 The cost-recovery target should be changed to a 50:50 split between industry and all Australian governments – with the proportional split between the Commonwealth Government and state and territory governments remaining equal, at 25 per cent each.
(2012 to 2015), which provides details on the WELS Scheme’s approved budget for 2012–13, and 2014–15 (Table 3). Table 3. Approved WELS Scheme budget – 2012 to 2015 Year Approved budget 2012–13 $1.85 million 2013–14 $1.91 million 2014–15 $1.96 million across all years $5.72 million Source: Australian Government Forecast for the 2014–15 financial year Expenditure for the 2014–15 financial year is expected to be approximately $1.44 million – or about $520,000 less than approved in the Strategic Plan. The Department noted to the Reviewer that this expected reduction in expenditure is due to the WELS Scheme not undertaking a number of planned activities, and staffing efficiencies made by the Department over recent years. Representatives from the Department described the Scheme as currently running in ‘lite’ mode, meaning it is being administered at the minimum expenditure to meet its objectives and undertake only absolutely core activities. For the 2014–15 financial year, revenue is expected to total $1.62 million. At time of writing, roughly $1.23 million has been invoiced to industry for registration fees for the year, and $392,000 has been received from all Australian governments. If estimates of expenditure and revenue are correct, the WELS Scheme should generate a surplus of approximately $184,000 for the year (Table 4) – which will accrue to the WELS Scheme special account. 4. Expected WELS Scheme expenditure and revenue – 2014–2015 financial year Item Approved dollar amount for 2014–15 (2011 Strategic Plan) Expected actual dollar amount for 2014–15 Expenditure - - Registration $470,020 $247,914 Policy development $441,657 $396,513 Compliance and enforcement $950,323 $493,4341 WELSAG administration $18,000 $0 Communications $80,000 $0 Third-party suppliers and services2 $0 $300,000 Total expenditure $1,960,000 $1,437,861 Revenue - - Industry contribution (fees) $1,568,000 $1,230,000 Commonwealth Government contribution $196,000 $196,000 State and territory contribution $196,000 $196,000 Total revenue $1,960,000 $1,622,000 14 2013–
Pty Ltd Plumbing Industry Climate Action Centre (PICAC) Harper’s Bathroom Consumer Utilities Advocacy Centre (CUAC) Victorian Department of Environment and Primary Industries IAPMO R&T Oceana Canberra – Wednesday 17 December 2014 Australian Building Codes Board (WaterMark) Melbourne – Friday 19 December 2014 Commonwealth Department of Industry and Science Bunnings Group Limited Melbourne – Monday 2 February 2015 Victorian Building Authority Teleconference – Tuesday 3 February 2015 New Wales Department of Primary Industry Teleconference – Wednesday 4 February 2015 Australian Capital Territory Environment and Planning Directorate Kinetic Group Teleconference – Tuesday 10 February 2015 Bosch and Siemens Home Appliances Pty Ltd Teleconference – Wednesday 11 February 2015 Tasmanian Department of Primary Industries, Water and Environment Canberra – Friday 13 February 2015 Office of the Australian Business Commissioner Commonwealth Department of Industry and Science, Appliance Energy Efficiency Branch (E3 Program) Public written submissions received for the Review are listed as follows: Australian Industry Group (AIG) Australian Association (AWA) Azzurra Bathroom Furniture City West Water
Appendix G – Comparison of related schemes Table 14. Comparison of WELS Scheme, WaterMark Scheme, E3 Program and Smart Approved WaterMark Topic WELS Scheme WaterMark Scheme E3 Program Approved WaterMark Administrator Commonwealth Department of the Environment (DotE) Australian Building Codes Board (ABCB) (and Commonwealth Department of Industry and Science) Commonwealth Department of Industry and Science Unincorporated organisation (hosted by Water Services Association of Australia) Enacting legislation Water Efficiency Labelling and Standards Act 2005 Not applicable Greenhouse and Energy Minimum Standards Act 2012 Not applicable Aim and objectives The Efficiency Labelling and Standards (WELS) Scheme requires the mandatory registration and labelling of certain water-using products supplied for use across Australia. The Scheme aims to reduce society’s total water consumption by promoting the adoption of more water efficient products and technologies by providing consumers with product specific water efficiency information at the point of supply. The WaterMark Certification Scheme is a mandatory certification scheme for plumbing and drainage products to ensure that plumbing and drainage materials and products are fit for purpose and appropriately authorised for use in plumbing installations across Australia. The aim of program is to promote the development and adoption of products that use less energy, produce fewer greenhouse gases and contribute to reducing the amount of energy used, or greenhouse gases produced, than other products. The program does this through encouraging consumers to select products at point of sale that use the least amount of energy and by setting a range of Minimum Energy Performance Standards (MEPS). The Approved WaterMark Program aims to create an Australia that is aware of, and actively engaged in, the efficient use of water. The program aims to do this by identifying, certifying and promoting innovative products and services that are water efficient, educating consumers on the importance of water conservation, and championing innovative solutions for sustainable water use.
Product coverage showers tap equipment flow controllers toilet (lavatory) equipment urinal equipment clothes washing machines dishwashers. appliances and fixtures (air conditioners, dental equipment, water filters etc.) sanitary fixtures (urinals, toilets etc.) water-using appliances (icemakers, washing machines, sterilizers, steamer etc.) water heater and storage tanks pipes and fittings pressurised pipes and fittings jointing materials water supply valves and valve accessories. fridges and freezers washing machines clothes dryers dishwashing machines air conditioners electric and gas water storage heaters certain lighting equipment, and transformers and converters televisions and associated consumer electronics computers (including laptops) and monitors distribution transformers electric motors refrigerated display cabinets close control air conditioners commercial chillers swimming pool pumps (voluntary). Covers the certification for all outdoor products/services. Examples include: cleaner commercial glass washers irrigation equipment mulches plant pots pool covers soil amendments. Revenue generation model Partial cost-recovery scheme registrants are charged a fee for registration, and state, territory and Commonwealth Governments contribute remaining revenue requirements. Registrants pay Conformity Assessment Bodies (CABs) for WaterMark Certification, and CABs pass a 4 per cent royalty fee onto ABCB to partially cover costs associated with the WaterMark Product Register. Remaining revenue requirements are covered by the ABCB. Partial cost-recovery where scheme registrants are charged a fee for registration, and state, territory and Commonwealth Governments contribute remaining revenue requirements. The program is not-for- profit and was founded through funding from the Smart Australia program. It receives revenue from fees from the application and certification process. Number of products Approximately 20,000 products Between 45,000 and 65,000 products Unknown Unknown
Length of registration 1 year Lifetime or 1 year dependent on product 5 2 years (with option for renewal) Voluntary or mandatory Mandatory Mandatory Mandatory Voluntary Point of enforcement Point of sale Point of installation Point of sale of sale, and point of product or service development Compliance and enforcement The DotE manages the WELS scheme in accordance with its Compliance and Enforcement Policy (2009). This includes promotion of self- regulation via education and communication to encourage compliance. Additionally the DotE can run compliance audits and testing and pursue a graded range of actions for compliance under the WELS Act 2005, such as: issuing infringement notices applying pecuniary penalties seeking injunctions seeking criminal prosecution initiating civil litigation or, cancelling or suspending registration. While the ABCB manages and administers the WaterMark scheme, the Joint Accreditation System of Australian and New Zealand (JAS-ANZ) authorizes the CABs. The CABs monitor supplier compliance and state and territory inspectors check plumber compliance. ABCB may also check test products and remove accreditation from CABs. Compliance and enforcement of the E3 Program is the responsibility of the E3 Committee comprised of Commonwealth, state and territory Government agencies and New Zealand Government representatives, the committee is chaired by an officer of the Department of Industry and Science. The E3 Committee promotes compliance through clear guidance on requirements and provides a forum for the exchange of ideas. Additionally it runs check tests and in- store surveys on labelling and registration compliance. Product applications are assessed by the program’s independent Technical Expert Panel who assess the application and reserve the right to approve product and license the use of the Smart Approved WaterMark logo. Source: Australian Government 2015g, Smart Approved WaterMark 2015, Australian Government 2015c, and ABCB 2015.
Applicants for the label (see Figure 34) are certified against a set of criteria and products are tested by designated institutions. Once a product has been certified, it is listed by the Department of State Economic and Trade Commission and is given priority in government procurement. Figure 34. China Water Conservation Certificate Source: Ecolabel Index 2015.