Greenhouse and Energy Minimum Standards (Exemption) Instrument (No. 1) 2020

Administered by Department of Industry, Science and Resources

Legislation au F2020L00868 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by the authority of the Greenhouse and Energy Minimum Standards Regulator

Greenhouse and Energy Minimum Standards Act 2012

Greenhouse and Energy Minimum Standards (Exemption) Instrument (No. 1) 2020

Purpose and operation

Section 37 of the Greenhouse and Energy Minimum Standards Act 2012 (the Act) enables the Greenhouse and Energy Minimum Standards (GEMS) Regulator, by legislative instrument, to exempt models of GEMS products from one or more requirements of a GEMS determination in relation to all or specified supplies or uses of products of that model, and enables the GEMS Regulator to specify conditions to which the exemption is subject. GEMS determinations are defined in section 11 of the Act.

Section 37 also provides that regulations may be made in order to provide a framework for administrative processes around the submission and assessment of applications for exemption. Division 4.1 of the Greenhouse and Energy Minimum Standards Regulation 2012 (the Regulation) sets out the circumstances in which the GEMS Regulator may exempt a model of a GEMS product from the requirements of a GEMS determination.

The purpose of the Greenhouse and Energy Minimum Standards (Exemption) Instrument (No.1) 2020 (the Instrument) is to exempt the specified air conditioners from the minimum energy performance standard (MEPS) levels set in Part 3 and Schedule 1 of the Greenhouse and Energy Minimum Standards (Air Conditioners up to 65kW) Determination 2019 (the Determination).

Kirby HVAC&R Pty Ltd (Kirby) supplies Lennox brand outdoor air conditioner condensing units, which are connected to an existing ducted gas heating system to provide a ducted cooling solution to houses with such systems. These products are subject to MEPS levels for the first time under the Determination. Kirby had orders in place with its overseas supplier for 248 units of such products which do not meet the new MEPS levels established in the Determination, with delivery expected in March 2020. Had the units arrived in Australia prior to the Determination coming into force on 1 April 2020, they could have continued to be supplied after that date without needing to comply with the Determination due to the grandfathering arrangements of the Act. However, COVID-19 related supply chain disruptions delayed the shipping of the units, potentially until late 2020.

Kirby sought an exemption from the MEPS level requirements for the ordered units to allow them to be supplied when they arrive in Australia, in order to avoid the financial losses associated with being unable to recover the purchase cost of the units, and the units being scrapped, if they were unable to supply them.

The GEMS Regulator considered all the matters set out in the Regulation and has decided to grant the exemption requested by Kirby. While the units do not meet the MEPS level requirements, the margin by which they fall below them is relatively small, and the number of units in question is small in the context of sales in the air conditioner market in a given year. Consequently, the negative impact on Australia’s greenhouse gas emissions as a result of the exemption will be negligible. In addition, the circumstances of the delays that led to the products being non‑compliant were beyond Kirby’s control.

Models covered by exemptions must still be registered under the Act.

Authority

Section 37 of the Act enables the GEMS Regulator to exempt models of GEMS products from one or more requirements of a GEMS determination. An exemption can be in relation to all supplies or uses of products of that model or limited to specified supplies and uses. The GEMS Regulator can specify conditions to which the exemption is subject. 

Division 4.1 of the Regulation sets out the circumstances in which the GEMS Regulator may exempt a model of a GEMS product from the requirements of a GEMS determination.

Consultation

The exemption set out in the Instrument was considered on application from the applicant. Consultation was undertaken with the applicant for the purpose of clarifying the exemption application.

Regulatory Impact

There will be no regulatory burden arising from the Instrument. The OBPR has advised that such proposals are not likely to have a regulatory impact on business, community organisations or individuals, and therefore the preparation of a Regulation Impact Statement is not required.

Detailed description of provisions in the Instrument

  1. Name

Section 1 specifies the name of the Instrument as the Greenhouse and Energy Minimum Standards (Exemption) Instrument (No. 1) 2020.

2.      Commencement

Section 2 provides that the Instrument commenced on the day after it is registered.

3.      Authority

Section 3 sets out the provision of the Act under which the Instrument is made.

4.      Definitions

Section 4 sets out definitions of terms used in the Instrument. The term ‘exempt model’ is defined in section 5 of the Instrument.

5.      Exemption

Section 5 exempts the models specified in clause 1 of Schedule 1 to the Instrument (the exempt models) from the requirements specified in clause 2 of Schedule 1.

6.      Conditions of exemption

Section 6 provides that the conditions specified for the purposes of subsection 37(2) of the Act are set out at clause 4 of the Schedule. The purpose of the conditions is to minimise the negative effects on Australia’s greenhouse gas emissions of granting the exemption, while delivering a reasonable outcome for the applicant.

7.      Repeal

Section 7 provides that the Instrument is repealed on the day after the end of the period of 1 year after it is registered.

Schedule 1 – Exemption

Schedule 1 to the Instrument sets out the following terms:

  • the specified exempt models, including model numbers, product descriptions and the number of units covered by the Instrument (clause 1);
  • the requirements of the Determination from which the models are exempt (clause 2);
  • the supplies to which the exemption applies (clause 3); and
  • the conditions to which the exemption is subject (clause 4), which include:
    • limiting supply of the exempt models to the number of units identified in clause 1; and
    • reporting obligations for the supplier.
      Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Greenhouse and Energy Minimum Standards (Exemption) Instrument (No. 1) 2020

 

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Overview of the Legislative Instrument

The Greenhouse and Energy Minimum Standards (Exemption) Instrument (No. 1) 2020 specifies models of Greenhouse and Energy Minimum Standards (GEMS) products that the GEMS Regulator has exempted from the requirements of Part 3 and Schedule 1 of the Greenhouse and Energy Minimum Standards (Air Conditioners up to 65kW) Determination 2019.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

 

Shane Gaddes

GEMS Regulator

 

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.