VEEC calculations for Hot Water upgrades change 1 Feb 2024
EverYthing Plumbers need to know ABOUT 2024 VEEC CaLCULATION CHANGES TO AVOID CASHBACK PITFALLS
WHAT’S CHANGING?
On 1 February 2024, the VEU Electricity Emissions factor - used to calculate VEECs - is dropping to 0.5334 to reflect our cleaner, greener energy system.
For upgrades completed before 1 February 2024, the current emissions factor - 0.6738 - applies to the VEEC cashback claim.
SO WHAT DOES THIS MEAN FOR MY VEEC CASHBACK CLAIMS?
For retailers, installers and customers, it means less cashback for replacing electric, and improved incentives for replacing gas.
Here are some general examples:
Replacing Electric hot water with a Heat Pump
A 300L heat pump replacing an existing electric water heater in metro Melbourne can expect to receive around 12 VEECs (or $660.00 at current buy-back price of $55.00) when installed on or after 1 Feb 2024.
By completing the upgrade before 1 Feb 2024, you can secure around 15 VEECs ($825.00) under the current calculation formula.
That’s a difference of $165.00 for customers. So our recommendation, don’t delay these installs.
Replacing Gas hot water with a Heat Pump
Meanwhile, gas to heat pump upgrades will receive slightly more cashback after the calculation change comes into effect.
A 315L heat pump replacing gas in Metro Melbourne can expect to receive around 8 VEECs when installed on or after 1 Feb 2024. Up from around 7 VEECs when installed in Jan 2024.
That’s an extra $55.00 discount for customers.
3 WAYS TO MANAGE THIS CHANGE WITH EASE
Keep 1 Feb 2024 in mind when quoting and scheduling jobs.
Complete your water heater and air conditioning upgrades that replace electric hot water or heating/cooling systems before 1 February to avoid the VEEC cashback reduction you quoted for your customers.
Relax. The calculation changes apply to the installation date, not your claim submission date.
Cashback for jobs completed in Jan 2024 will continue to be calculated at the current rate, even if you don’t get round to doing the cashback claim later.
Upgrades completed in 2024 have until 30 June 2025 to claim the VEECs, but we recommend submitting claims as soon as possible to unlock the cash you’re entitled to.
Use Geo as your quote tool
It’s much simpler than trying to use the VEU calculator.
To check how the emissions factor change will affect your preferred products and upcoming jobs, log in to Geo and start a new assignment form with an installation date of 1 February 2024.
Don’t have an account with Green Energy Trading? Sign up today.
EXPECT MORE CALCULATION CHANGES IN 2025
The VEU calculation factors are legislated to change again in 2025, impacting VEECs calculated for upgrades completed from 1 Feb 2025.
A regulatory review will be commencing in 2024 to set targets and update regulations for the VEU for 2025 onwards.
We expect to get more detail and insights into future emission factor reductions over the coming year.
Subscribe to our updates and we’ll keep you up to date with pricing and scheme changes so you can adapt to VEU program changes with confidence.
If you have further questions, please don’t hesitate to call us.
1300 077 784