Create VEECs for nearly all mid-scale solar (200kW to 5MW) instead of annual creation of LGCs
The Victorian Energy Upgrades (VEU) Program is a VIC Government initiative that helps Victorians cut power bills and reduce greenhouse gas emissions by giving households and businesses access to discounted energy-efficient products and services. Limitations lifted in December 2020 mean that most business installing mid-scale solar (200kw – 5MW) behind the meter will have a substantially higher ROI using VEECs rather than LGCs. LGCs are registered under the Renewable Energy Target. This approach can also be used for other mid-scale wind, renewable energy, and bioenergy projects.
The VEEC value is 2.5 higher than LGCs and realised in 16 months not over a 10-year period
Wattly is an Accredited Provider under the VEU. Solar VEECs are created using the VEU Project-Based Activity (PBA). The VEU PBA uses a measurement & verification (M&V) methodology that measures and models the energy usage onsite and calculates the grid energy savings resulting from the solar PV system. The modelling determines the energy usage against sites primary production outputs (different for each business) and solar irradiance. Wattly is the industry leader in Project-Based Activities.
“In Victoria the VEEC rebates now beat LGCs every time” – Hamish McGovern, CEO – Wattly.
What are the rebates worth?
Here is a couple of examples for systems commissioned by 31st of January 2022.
- A 500 kW Solar PV systems for factory or warehouse running 5 days per week with 90% self-consumption on weekdays – weekend and excess energy exported to the grid:
– VEEC Value $130,000 vs LGC Value: $68,000
- A 1.25 MW Solar PV system used in site with 7 days per week full onsite consumption (eg a shopping centre, a coldstore, or a factory with continuous production).
– VEECs: $520,000 vs LGCs: $170,000
- The VEEC value is higher if commissioned by 31st July this year
The benefit of the VEECs far outweighs the value of LGCs. In addition, it is possible to claim the first 100kW under the STC if implemented first as a separate system. Given the value of the VEECs today there isn’t as much benefit in taking that approach and it is simpler to build the system all in one go.
- 750 kW System with 5.5 days per week self-consumption and 10% during that period exported.
- The other 1.5 days is fully exported to the system.
- VEEC payments are just on $250,000 whilst LGCs net $125,000 over 10 years and a NPV of $100,000.
The paybacks differ depending on your location, available incentive(s) and power generated. Talk to us about unlocking incentives and which rebates are right for you.
System Eligibility for VEECs
To claim Victorian Energy Efficiency Certificates (VEECs) for a new mid-scale solar installation, you must:
- Be an existing facility based in Victoria that has been operating the site for over twelve months
- Will not claim LGCs or STCs for the new solar system from the Renewable Energy Target
- Planning to install a new system size between 200 kW and 5 MW solar panel capacity
- Consume the bulk of the solar energy onsite (VEECs are based on energy savings from the grid)
- Not be excluded by the SAP / EREP register (some large energy-users are excluded)
- Must be registered with the regulator through Wattly BEFORE construction commences
- Provide details of how energy is consumed onsite for Wattly to model the grid energy savings
Process and Timelines
Wattly will work through the following process to claim VEECs from mid-scale solar PV systems:
- Approval of the project to the program regulator BEFORE construction commences
- Modelling of the baseline energy usage is performed (using 12 – 24 months of pre-upgrade data)
- Solar installer performs construction and grid connection of the PV system
- Twelve months of operating data is collected (along with production outputs)
- Modelling of the upgraded energy usage is compared to baseline to calculate the grid energy savings
- The quantity of VEECs registered is based on the MWhs of energy saved for the next 10 years converted into tonnes of CO2. 1 VEEC = 1 Tonne of CO2 abated
- VEECs are sold to Energy Retailers to meet their obligations under the VEU
- Payments are made to the end-customer or to the entity providing the Solar system
Still Looking For Something Else?
If you’re located outside of Victoria, or need more information on your options for Large-Scale Generations Certificates (LGCs) under the Renewable Energy Target, have a look at our large-scale system page.