Two companies have been restricted and suspended from participating in the Victorian Energy Upgrade (VEU) scheme after allegedly claiming certificates for “phantom” energy efficiency projects that did not take place.
Under the newly expanded VEU program, accredited businesses undertake energy efficiency upgrades that entitle them to create Victorian Energy Efficiency Certificates (VEECs), which they can then sell.
Victoria’s Essential Services Commission (ESC) alleged on Friday that contractors working for A.K. Alvi Enterprises Ptd Ltd (Zerowatt) and Phenix Pty Ltd (LEDSaves) had falsely claimed to have completed weather sealing and low-flow shower rose installations.
In the case of Zerowatt, the commission alleges contractors working for the company manipulated photos to claim additional certificates and, on at least one occasion, incentivised a customer to support a false claim.
As a consequence, the ESC says Zerowatt has been suspended from the VEU program for three months, over which time the business is banned from creating certificates for any type of energy efficiency work.
The commission also has refused registration of 200 certificates, valued at $19,200, and required Zerowatt to have its quality assurance processes independently audited.
LEDSaves, meanwhile, has had a six-month restriction placed on its VEU accreditation, banning it from creating certificates for weather sealing and shower rose upgrades.
LEDSaves self-reported that contractors working on its behalf misrepresented the number of upgrades completed and submitted photos of different properties as evidence of work that did not occur.
The commission has refused registration and ordered the surrender of a total of 4,552 certificates, valued at more than $400,000. It has also odered LEDSaves to undergo an independent audit of its quality assurance processes.
The ESC said that while the alleged conduct was carried out by contractors in both instances, it was up to the VEU accredited businesses to ensure certificates created in their names were compliant with VEU program rules.
And it has warned that it “will not hesitate” to enforce stronger penalties – such as cancellation of accreditation, total ban, or civil or criminal prosecution – if it considers them appropriate.
“Accredited businesses must have safeguards in place to ensure contractors working on their behalf act with integrity. If they don’t, it’s their accreditation and reputation at stake,” ESC chair and commissioner Gerard Brody said on Friday.
“Falsifying evidence is a serious and flagrant breach of VEU rules. Restricting and suspending these businesses will enable them to implement safeguards to ensure it does not happen again.
“Stopping these businesses from creating certificates directly affects their ability to generate income from the VEU program. The message is clear – breaking the rules puts your business at risk,” Brody said.
Nearly 100,000 households have participated in the Victorian Energy Upgrades program in the first six months of 2025, including to swap out gas appliances for efficient electric alternatives that can cut hundreds of dollars from their annual energy bills.
State energy minister Lily D’Ambrosio said in August that 99,000 households had taken advantage of the VEU program in the first half of the year, with participation expected to exceed 170,000 households by year’s end.
From July 2024, VEU discounts were made available for houses switching their gas cooktops for electric induction stoves, and for a wider range of hot water and space heating heat pumps. Further, the Allan Labor government has introduced legislation to extend the VEU program to 2045, from its current end-date in 2030.
For example, a household that replaces a gas ducted heating system with an electric heat pump can get a cost deduction of up to $3,600.
As well as extending the VEU, the Allan government is also undertaking a review of the program that will be conducted over the next two years.
Sophie is editor of One Step Off The Grid and editor of its sister site, Renew Economy. Sophie has been writing about clean energy for more than a decade.
