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Water Efficiency Labelling and Standards Act 2005

Section 75 of the Water Efficiency Labelling and Standards Act 2005 (WELS Act) requires an annual report on the operation of the Water Efficiency Labelling and Standards (WELS) scheme. This section provides the report for 2020–21.

Background

The objectives of the WELS Act are to:

  • conserve water supplies by reducing water consumption
  • provide information for purchasers of water-use and water-saving products
  • promote the adoption of efficient and effective water-use and water-saving technologies.

The WELS Act and corresponding state and territory legislation provide for the operation of the WELS scheme. This mandatory scheme provides information about the water efficiency and general performance of water-using and water-saving products. This enables consumers to make informed choices about their water use.

We administer the scheme on behalf of all governments. Costs of administering WELS are largely covered through registration fees, with a target of 80% cost recovery from industry.

Review

Section 76 of the WELS Act requires an independent review of the operation of the WELS scheme every 5 years.

In late 2020 Allen + Clarke Consulting commenced the 2020 review. The review is evaluating the design, effectiveness and efficiency of the WELS scheme and the WELS intergovernmental agreement. The reviewers conducted surveys and interviews in late 2020–21. They consulted governments, industry representatives, consumers and consumer advocates, environmental and water organisations, utility companies and managers of similar schemes.

The review will be finalised in 2021–22. The Australian, state and territory governments will then consider the recommendations of the report. The response will be used to inform our forward work program.

Scheme effectiveness

The environmental and economic benefits of consumers choosing water-efficient models are:

  • estimated annual saving of 149 GL of water, which is likely to be 230 GL per year by 2036
  • estimated annual saving of $1.3 billion in water and water-heating utility bills, which is likely to be a saving of $2.6 billion a year by 2036.

The WELS scheme continued to have benefits beyond the objectives of the Act. For example:

  • water utilities use the scheme to advise clients on saving water and to fund initiatives such as showerhead swaps for WELS-registered products
  • the Australian Government requires all Commonwealth entities to consider WELS ratings in their procurement of water appliances as part of the National Waste Policy Action Plan 2019
  • state and territory governments use WELS to inform sustainability and development initiatives such as the WaterWise Perth action plan and the NSW Government building sustainability index.

Independent consumer research shows that the WELS label is the second-most recognised eco-label and that WELS water efficiency rating is a key consideration when Australians buy a washing machine or dishwasher. In October 2020 Standards Australia highlighted WELS in a promotional video for World Standards Day.

Small businesses, such as childcare providers, are sharing guidance on using WELS ratings to buy fittings and appliances. The WELS ratings are used nationally to determine sustainability ratings of buildings, fitouts and communities under the Green Building Council of Australia’s Green Star scheme.

Overseas, the New Zealand Government and associated supply chains rely on our registration processes and rating of WELS products. The WELS scheme, in driving the development of an international standard for water efficiency labelling programs, is contributing to the Australia–Singapore Comprehensive Strategic Partnership roadmap.

We are working to improve the regulatory practices across the department, including the WELS scheme. Our regulatory blueprint will apply to all departmental regulatory systems over the next 5 years.

Stakeholder engagement and education

We provided education and assistance to product manufacturers, suppliers and other interested parties. This included:

  • guidance on product registrations
  • free electronic copies of the WELS standards through Standards Australia to help people get information about WELS requirements
  • a public WELS product registration database
  • 2 issues of the InkWELS newsletter, which reports on WELS developments, technical matters and achievements.

The WELS Advisory Group met in November 2020. This is an industry group that represents the plumbing and appliances industry sectors, standards and certification specialists, water services, and small business. The meeting was part of our broad and frequent engagement with industry on matters of interest and on opportunities to collaborate on communications or research activities. We sought the group’s views on potential improvements to the WELS standards, how we can improve our registration database for users, and potential non-compliance to inform our risk-based compliance targeting.

We participated in the Joint Accreditation Scheme of Australia New Zealand (JAS-ANZ) Technical Advisory Committee, which considers WaterMark certification body accreditation. We continued to work with JAS-ANZ on compliance matters involving the committee’s accredited members.

We held 3 WELS Officials Group meetings with state and territory counterparts. We shared information on the status of the program, water efficiency initiatives and the progress of the independent WELS reviews. We discussed compliance, collaborated on communication and engagement initiatives, and provided input into state and territory WELS policies and programs.

We continued to collaborate with the co-regulators responsible for the:

  • WaterMark on WELS plumbing products (Australian Building Codes Board)
  • Equipment Energy Efficiency (E3) program responsible for energy ratings on WELS whitegoods (Department of Industry, Science, Energy and Resources)
  • National Australian Built Environment Rating System (NABERS) water rating assessments
  • National Construction Code, which is looking at making WELS ratings part of minimum building and construction standards from 2022.

Our engagement with co-regulators supported compliance activities and consideration of improvements to standards or procedures.

We worked with the Department of Foreign Affairs and Trade on product labelling requirements, which are being negotiated as part of the Australia – European Union and the Australia – United Kingdom free trade agreements.

In collaboration with the Australian Industry Skills Committee and with the endorsement of peak industry bodies, we achieved agreement to include WELS information in the companion volume implementation guide for the plumbers and builders national licensing curriculums. The revised guide will be released in 2021. Registered training organisations will use this when developing licensing courses. This will help new plumbers and builders learn about the scheme and their obligations when supplying WELS products.

Standards

We continued work with Standards Australia committees to maintain Australian/New Zealand Standard (AS/NZS) 6400:2016 Water efficient products – Rating and labelling and related product-specific standards. These committees ensure that industries are engaged in developing and implementing the standards they must meet.

There was progress on amendments that will extend the shower star rating to 5 stars. Many showerheads already on the market can be promoted to 5 stars when the amendments are published. This amendment will drive the industry towards designing more efficient products.

We are considering amendments to:

  • alter text advice to require the WELS registration number
  • introduce minimum water efficiency performance requirement for WELS plumbing products that align with Plumbing Code of Australia requirements
  • introduce minimum water efficiency performance for dishwashers, additional labelling requirements for combination showers and amend labelling for ‘Not Star Rated’ showers to clarify their rating
  • expand the advertising, print media and electronic display clause to include WELS information requirements in building developments.

In 2020–21 product-specific standards were updated and published for:

  • dishwashers (AS/NZS 2007:2021)
  • clothes washing machines (AS/NZS 2040:2021)
  • rotary dryers (AS/NZS 2442:2021).

We contributed to draft standards for tapware (AS/NZS 3718), flexible hose assemblies (AS 3499) and urinals (AS/NZS 3892). These are under consideration by Standards Australia.

We communicated with industry on updated standards and on transition periods that give time for industry to adopt the changes.

Standards Australia is developing an in-service check-testing standard for showers and tapware. This will allow testing of products against the water efficiency requirements of the Plumbing Code of Australia, and their claimed water use after installation. This will help ensure that consumers are getting what they paid for.

Following stakeholder feedback, we are considering expanding the WELS scheme to provide star ratings for waterless urinals and for the drying cycles for combined washer/dryer machines. We are working to help industry meet testing requirements for dishwashers and standards for plumbing products in recreational vehicles and other mobile end-use settings.

Since 2018 we have been leading work in the International Organization for Standardization to establish an international standard for water efficiency labelling programs. The project committee comprises 37 member countries, 19 participating and 18 observing. In 2020–21 the committee met 4 times to progress the international standard, which should be published in 2021.

The international standard will provide a framework for nations seeking to develop a water efficiency product labelling program. This will support global efforts to reduce demand for water, contributing to targets under the United Nations Sustainable Development Goal 6: Clean water and sanitation. Appendix A describes our achievements on the goals.

WELS product registrations and public database

In 2020–21 we assessed and registered 27,340 products and 12,177 product variants (such as colour, finish and tap options). This included 6,406 registrations ceasing on 21 July 2021. The number of products being assessed and registered has increased by 32% on the previous year.

More than 434 organisations registered products. Of these, 239 were based in Australia. Most of the international organisations were based in Asia and Europe. The registered products comprised:

  • 795 models of clothes washing machines
  • 825 dishwasher models
  • 23,606 tap equipment models
  • 10,407 shower equipment models
  • 3,466 lavatory (toilet) models
  • 232 flow controllers
  • 185 urinal models.

The significant increase in tap and showerware registrations are, to a small degree, the result of ongoing engagement, education and our compliance program. However, the number increased significantly following the withdrawal from market of a flow controller that was used in thousands of registered products. This meant manufacturers had to replace the flow controller model and register more than 2,000 new products. The remainder of the increase is a direct reflection of market demand.

We maintain a 24-hour WELS online product registration database on the Water Rating website. The database provides access for all stakeholders, including potential purchasers, to search and view the details of registered products. This year we improved the database by simplifying the process for registrants and registration officers.

In 2020 we began a review to inform an upgrade of our database. The review aims to improve the user experience for businesses and the public. The upgrade will include an improved compliance case management system and an improved user interface for the public. It will also streamline the registration application process and the assessment and payment process.

Compliance and enforcement

The WELS Act requires products to be registered and labelled at all points in the supply chain. Compliance and follow-up enforcement actions are in accordance with the WELS Compliance and Enforcement Policy.

In 2020–21 compliance activities focussed on responding to allegations, monitoring internet-based sales and restarting the national education and inspection program for the residential building industry. We engaged water and plumbing inspectorate agencies, precinct development agencies and peak industry associations to ensure regulated businesses received consistent and up-to-date information about their obligations. When travel restrictions eased, we inspected bathroom and kitchen fittings selection centres and product inclusion lists in Adelaide and Perth.

We continued to detect non-compliance with labelling or registration requirements. We:

  • opened 84 new cases and carried forward 29 cases from 2019–20
  • closed 96% of cases because businesses became compliant after education and warnings
  • issued 5 warning notices
  • started civil action in the Federal Court against 4 companies, 2 of which are in liquidation, and their sole director for advertising products that were not registered or labelled in accordance with the WELS Act.

Our joint compliance monitoring program with eBay continued to be effective. We educated 617 online sellers on complying with WELS registration and labelling requirements. We carried 60 cases to this reporting period, for a total of 677 cases. Of these, 641 cases were closed, including 17 cases where the 17 seller accounts were restricted. More than 2,100 non-compliant product models were removed from being offered to the Australian market. The increase on previous years is proportional to the increased focus and resources we deployed to improve compliance in online markets.

Financial information

The WELS Strategic Plan 2016–19 sets out an agreed revenue budget based on projected industry fee revenue that increases annually at 4%. The strategic plan was extended to 2022 by mutual agreement with the state and territory governments. A new strategic plan will be developed following the joint government response to the WELS scheme independent review.

In 2020–21 the Australian Government and the combined states and territories each contributed $204,000.

Industry revenue arises from tiered registration application or annual renewal fees for WELS products. In 2020–21 industry fee revenue was 0.7% below the projection, as shown in Table 53.

Table 53 WELS industry fee revenue

Item

2018–19 ($)

2019–20 ($)

2020–21 ($)

Industry fee revenue

1,606,300

1,636,172

1,618,700

Projected fee revenue

1,510,000

1,568,000

1,630,000