WATER EFFICIENCY LABELLING AND STANDARDS BILL 2006 Second Reading Speech

Northern Territory Second Reading Speeches

WATER EFFICIENCY LABELLING AND STANDARDS BILL 2006

(This an uncorrected proof of the daily report. It is made available under the condition that it is recognised as such.)

Ms SCRYMGOUR (Natural Resources, Environment and Heritage): Mr Acting Speaker, I move that the bill now be read a second time.

This bill creates the Water Efficiency Labelling and Standards Act, which aims to encourage the conservation of water supply by reducing water consumption, provide information for purchasers of water use and water saving products, and promote the adoption of efficient and effective water use and water saving technology.

The growing demand for water in urban areas is a major policy challenge for all Australian jurisdictions. Technologies to increase the efficiency of water use in urban areas are readily available but are not being widely adopted; in part because purchasers do not water efficiency information to consider when buying appliances such as toilets, dishwashers and washing machines. One way to provide this information in the marketplace is through water efficiency labelling. A voluntary water efficiency labelling scheme has been in existence since 1988. However, because of the voluntary nature of the scheme, the coverage and impact of the existing program has been limited. Few suppliers have chosen to label and those who have only label their best-performing products.

The purpose of the WELS scheme is to conserve water supplies by reducing water consumption through the adoption of water efficient appliances. Cost-effective products to increase water efficiency are readily available but are not widely adopted because there is a lack of information at the point of sale. Where this information is available it is often not in a form that would allow a consumer to directly compare the efficiency of competing appliances, and lack of accessible information at the point of sale is a significant barrier to the uptake of water-efficient products. The WELS scheme aims to inform consumers about the relative efficiency of products, making this information readily available and will encourage manufacturers to produce, and consumers to buy, more efficient appliances. In this way, the requirement to label appliances helps shift the market towards more efficient appliances.

The legislative approach is a national legal framework where Commonwealth legislation is mirrored by state and territory legislation. Under this approach, the Commonwealth legislation applies to corporations and importers. The state and territory legislation applies to businesses that are beyond the limit of Commonwealth constitutional power, such as unincorporated businesses. The Commonwealth Water Efficiency Labelling and Standards Bill 2004 was passed by the Senate on 8 February 2005. The legislation adopted by states and territories will provide for the conferral of relevant powers and functions on a Commonwealth-based WELS regulator. The regulator will oversee the registration of WELS products to which the mandatory labelling and standards provision apply, and will monitor and enforce compliance with the scheme. Most jurisdictions in Australia have already introduced mirror legislation.

Water use products such as clothes washers, and water saving products such as waterless urinals, may be determined to be WELS products by the relevant Commonwealth ministers in consultation with the states and territories. WELS products cannot be sold unless they have been registered with the regulator. The bill contains the provision enabling the Northern Territory to pass a regulation that would prevent such a determination from having effect in the Territory. It is not expected that this provision would be used other than in circumstances where there are compelling reasons for doing so.

The WELS scheme may require registered products to be labelled. Product labels must be designed in accordance with the WELS scheme standard and show the water efficiency rating and general performance rating of the product. The WELS scheme may also establish minimum standards for WELS products in relation to water efficiency and general performance. A product that does not meet the minimum standards will not be registered by the regulator and therefore cannot be sold in the jurisdiction that has adopted the WELS scheme.

The scheme commenced voluntary participation from July 2005 with mandatory requirements commencing July 2006. This voluntary labelling period of 12 months has provided time for manufacturers to test and register more than 3000 appliances and fixtures so as to meet the requirements of the scheme. The 12 month voluntary period has provided distributors and retailers of WELS products with an adequate opportunity to adjust their product range by the time the WELS scheme becomes mandatory.

From 01 July 2006 it will be an offence to supply a WELS product that is not registered. That requires labelling in accordance with the standards. If it is not labelled it does not meet minimum WELS standards for water efficiency and minimum general performance. The bill also specifies offences in relation to the act of misuse of WELS standards and related information. The regulator may seek an injunction in the Federal Court to prevent a person from engaging in an activity that is contrary to the act. Inspectors may be appointed by the regulator to determine whether a person is complying with the act or to investigate a possible offence. If necessary the investigator may apply to a magistrate for a warrant to enter premises used for or connected with the supply of WELS products. A regulator may require a person by means of a written notice to provide WELS related information to an inspector or to appear before a WELS inspector. Failure to provide information or to appear before an inspector is an offence. A regulator may cancel or suspend the registration of a WELS product if the conditions of registration are not complied with and the information provided to support the application was not accurate or is no longer accurate because of the changes to the product.

A person whose application to register a wells application that has been rejected, or who has had a wells registration suspended or cancelled may seek an internal review by the regulator of the regulator’s decision. Such a person may also seek a review of the regulator’s decision by the Administrative Appeals Tribunal. The Department of Natural Resources, Environment and the Arts will administer the scheme in the Northern Territory with the support of the Northern Territory Office of Consumer Affairs. From the Northern Territory perspective I anticipate the Commonwealth government will take timely responsibility for pursuing action under the scheme. The WELS scheme will initially include mandatory registration and labelling for showerheads, clothes washers, dishwashers, toilets and taps. Additional products such as evaporative cooling units and water heating and storage units could be brought into the scheme at a later stage. New products proposed for inclusion in the scheme would be subject to cost benefit analysis and public consultation.

The WELS scheme will initially apply a minimum standard only to toilets for which a plumbing standard already exists. This will not impact adversely on Australian manufacturers since toilets manufactured in Australia are already efficient dual flush systems. The minimum standard will prevent the import of single flush toilets.

In late 2002 the Commonwealth Department of the Environment and Heritage commissioned a feasibility study to examine the potential for and impact of introducing a national mandatory Commonwealth Department of Environment and Heritage scheme as a method of reducing urban water consumption. This study found that implementing the WELS scheme nationally would conserve 87.2bn Lt of water per year and generate nett savings to consumers of $900m by 2021 and have an overall benefit cost ratio of 4.0. From the resource cost perspective the projected nett benefit for Australia from WELS is about $386m per annum with a cost benefit ratio of 3.2.

The study also found that the introduction of the WELS scheme would also see a reduction in greenhouse gas emissions from electricity and water use by reducing the amount of hot water used in showers, taps, clothes washers and dishwashers, and the electricity required for pumping potable water and waste water. The WELS study did not examine each jurisdiction separately and, therefore, there is no information on the savings, costs and benefits to the Territory available from the study.

However, the Institute for Sustainable Futures undertook the Alice Springs Water Efficiency Study in 2003 which identified a number of savings possible including a water efficiency program which would include a retrofitting of water efficient fittings and appliances. It is estimated that in Alice Springs, based on the 50% uptake, the savings would be in the order of 118 mL per annum, or approximately $80 000 for consumers. As a consequence of the study, the Alice Springs Urban Water Management strategy was developed to encourage a shift to more water-efficient products. This strategy outlines the need for regulatory intervention to complement strategies like community education.

A number of election commitments were made in 2005 regarding water conservation, including a $50 rebate for those purchasing water safety devices in Alice Springs and Tennant Creek, and a doubling of funding for Cool Communities to $100 000 to encourage, among other things, water conservation. An example of a similar and successful scheme is the National Appliance and Equipment Energy Efficiency Program, where labelling and minimum efficiency requirements are specified in the relevant Australian standards, given effect by regulation and managed by government agencies.

The Territory community is right to expect that our valuable water resources are used efficiently. The government is committed to providing a reliable, affordable and sustainable supply of water to the people of the Northern Territory. The Water Efficiency Labelling and Standards Bill is an important mechanism to water security in the face of population growth and climate change. Mr Acting Speaker, I commend the bill to honourable members.

Debate adjourned.

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