How Victorian Businesses Can Get a Free Energy Upgrade in 2026
TL:DR The Victorian Energy Upgrades (VEU) program is fully operational in 2026 and has been legislatively extended to 2045. Most Victorian businesses can access zero-upfront LED lighting and HVAC upgrades through government-backed VEEC discounts. The 2026 VEEC target has dropped to 4.4 million certificates — VEEC prices will soften across the year, meaning early movers capture the highest discount values. Typical LED projects complete in 1–2 weeks. Glow Green is an ESC-Accredited Person and handles all compliance and paperwork on your behalf.
How Victorian Businesses Can Lower Operating Costs Through a Free Energy Upgrade
Energy expenditure is one of the fastest-growing line items on the balance sheet for Victorian small and medium businesses in 2026. Gas prices remain elevated. Electricity tariffs have risen sharply since 2022. And most commercial premises are still running lighting, heating, and hot water infrastructure installed a decade or more ago — equipment that is costing you money every single day it remains in place.
Here is the critical update: the Victorian Government’s Victorian Energy Upgrades (VEU) program is not only still fully operational — it has now been legislatively extended all the way to 2045. That is more than two decades of government-backed incentives available to your business. For most upgrades — particularly LED lighting retrofits and HVAC replacement — the program delivers a zero upfront cost outcome through a certificate trading mechanism that requires no rebate forms and no waiting periods.
Glow Green is an ESC-Accredited Person (AP) under the VEU program. In this guide, we break down every upgrade available to Victorian businesses in 2026, every regulatory change now in effect, and exactly how to secure your upgrade with no paperwork burden on your team.
How the VEU Program Lowers Your Operating Costs ?
The Victorian Energy Upgrades (VEU) program is a State Government scheme administered by the Essential Services Commission (ESC). It incentivises Victorian businesses to replace outdated, energy-hungry equipment with modern, efficient alternatives — and it funds those upgrades through a certificate trading mechanism, not a direct budget appropriation. This is why the program is structurally different from a standard rebate.
Here is how the mechanism works in four steps:
You engage Glow Green, an ESC-Accredited Person (AP), to assess and install eligible energy-efficient equipment at your premises.
Glow Green creates Victorian Energy Efficiency Certificates (VEECs). Each VEEC represents one tonne of greenhouse gas emissions prevented from entering the atmosphere.
Glow Green sells those VEECs to large energy retailers, who are legally required by Victorian legislation to surrender a set number of certificates each year.
The value of the VEECs is passed directly to you as an upfront discount on the upgrade — no rebate claim forms, no waiting, no invoicing gap.
The program has been operational since 2009 and has already delivered upgrades to over 100,000 Victorian homes and businesses. It is projected to prevent 37 million tonnes of greenhouse gas emissions between 2022 and 2027 — equivalent to removing more than 11 million cars from the road for a year.
For your business, the practical outcome is straightforward: eligible upgrades are completed at zero or significantly reduced upfront cost, by accredited installers, with all compliance handled by Glow Green. Your energy bills fall. Your operating costs fall. Your balance sheet improves.
The 2026 Regulatory Changes Every Victorian Business Owner Must Know
The VEU program has undergone significant regulatory updates since mid-2025. The following table summarises every material change now in effect, its operational impact, and the recommended strategic action for your business.
VEU Program Updates
| VEU Program | Effective | Cautionary Impact on Year Target | Strategic Action |
|---|---|---|---|
| VEU Program Extended to 2045 | 1 Jan 2025 | Targets drops 43% to 7.8m (from 13.7m). Smaller businesses already deployed (program cap reached). | Book assessment QUICK. ESC eligible to capture remaining funds. |
| 2026 VUE Target 6 to 8.8B | 1 Jun 2025 | Energy rebates have higher usage than predicted. Needing demand for VUE’s and the discount payable pool. | No account required — no fees — book straight into compliance. |
| Shortfall Penalty | 1 Jun 2025 | Energy rebates have higher usage than predicted. Needing demand for VUE’s and the discount payable pool. | No account required — no fees — book straight into compliance. |
| Activity #8 Review - Commercial Heat Pump | July 2025 | Minimum 32,000 customer sites installation required. Small-scale commercial new installations. | Request written VESC quote from Clive Green before embarking on commercial heat pump. |
| Background: Carbon Activity | July 2025 | VEU mandates for refrigerated display cabinets removed from 2026. Stocktake for integrated display cabinets increased from 2026. | Contact Clive Green for alternative paths for commercial refrigeration. |
| New CEC PID Only Activity Added | 1 Dec 2025 | Branded new VEU activity for commercial and industrial solar PV systems. Stocktake with 18% TCA for commercial and industrial solar. | Assess your metrics for CEC accredited – check VEU + STC claims. |
| ESC Enforcement Individual Installers | 2026 | The ESC can now sanction individual installers, not just accredited businesses. Reserve all VEU compliance activities. | Verify both company AND individual installer are ESC accredited. All Global claims are now preferred. |
| VEU Telemarketing Formally Banned | 2025 | The ESC has suspended all VEU telemarketing. Any telemarketing is now not allowed. | Report unsolicited contacts from telemarketers immediately. |
| VESC Creation | May 2025 | The 31 January lodgement deadline is now the final deadline for all VEU activities. | Be organised – no excuses accepted. You must submit all activities by 31 Jan. |
| Strategic Program Review Underway | Mid-Mar 2025 | ESC consultation is live. Proposed changes include significant reduction and more flexible VEU targets. | Monitor for progress updates. Give Green input if asked. All of clients matter. |
⚠️ Official Advisory — VEU Telemarketing Suspension
The Essential Services Commission has formally suspended all VEU telemarketing activity. If unsolicited telemarketing is received, this contact is not authorised under the VEU program and should be treated as a breach.
CFO Quick-Reference: 2026 VEU Program at a Glance
| Program Metric | 2026 Value / Status |
|---|---|
| Program Status | Fully operational — extended to 2045 |
| 2026 Annual VEEC Target | 4.4 million certificates |
| Victoria's 2030 Emissions Reduction Goal | 65% reduction vs 2005 baseline |
| Shortfall Penalty (Retailer) | $100 per VEEC — demand remains robust |
| Avg. Annual Business Savings (HVAC/Refrigeration) | $5,314 per year |
| Upfront Cost — LED Lighting | $0 (fully VEEC-funded for most premises) |
| Upfront Cost — Commercial Heat Pump HW | From $1,000 co-payment (Activity 44, July 2025 onward) |
| Typical LED Project Completion | 1–2 weeks from first contact |
Which Free Energy Upgrades Can Your Victorian Business Access ?
The VEU program covers a broad range of commercial upgrades. The table below provides a financial summary, followed by detailed eligibility guidance for each activity.
Upgrade Options & Savings Overview
| Upgrade Type | Typical CapEx Impact | Avg. Annual Savings / Payback | Best-Fit Business Type |
|---|---|---|---|
| Commercial LED Lighting | $0 upfront (VEEC-funded) | 12–18 month effective payback on energy spend | Offices, warehouses, retail, hospitality, schools, aged care |
| Commercial HVAC / Reverse-Cycle | VEEC reduces CapEx by 30–60% | Avg. $5,314/yr savings · 2–3 yr payback | Any non-residential Victorian premises |
| Commercial Heat Pump Hot Water (Activity 44) | From $1,000 co-payment + VEEC discount | Significant gas cost reduction · 2–4 yr payback | Gyms, hospitality, aged care, accommodation (700L+) |
| High-Efficiency Motors (Activity 31) | VEEC discount applied at point of install | Motor running costs reduced 20–40% | Manufacturing, cold storage, pumping systems |
| C&I Solar PV (New 2026 — Systems >100kW) | VEU + federal STCs stackable | Substantial reduction in peak electricity tariffs | Large warehouses, industrial sites, shopping centres |
Commercial LED Lighting — The Fastest Route to Zero-Cost Energy Savings
aLED lighting retrofits represent the most commonly accessed zero-upfront upgrade for Victorian businesses, and for good reason: the VEEC value generated by replacing fluorescent tubes, halogens, high-bay fittings, and metal halide systems typically covers the full cost of supply and installation. For most standard commercial configurations, your out-of-pocket cost is zero dollars.
Eligible premises include offices, warehouses, retail stores, hospitality venues, schools, aged care facilities, and any other non-residential Victorian building. The upgrade replaces old technology with VEU-approved LED product from the ESC Register — product that is tested, performance-rated, and warranted.
Ongoing benefits include a dramatic reduction in electricity consumption — LED technology typically uses 60–80% less energy than the fittings it replaces — plus lower maintenance costs from substantially extended lamp life. For a warehouse running 80 high-bay fittings across two shifts, this translates to meaningful and immediate cashflow improvement. View our Commercial LED Lighting page →
Commercial HVAC — Reduce Peak Demand and Cut Heating / Cooling Costs
Replacing old gas-fired heating or inefficient split systems with modern, high-efficiency reverse-cycle HVAC equipment is one of the most impactful upgrades available under the VEU program. The VEEC discount significantly reduces capital expenditure, and the ongoing operational savings are substantial: Victorian businesses using VEU-supported HVAC upgrades are currently saving an average of $5,314 per year on utility costs.
Eligibility applies to any non-residential Victorian premises currently operating qualifying legacy heating or cooling systems. The upgrade must replace a system that meets the VEU ‘before’ product criteria and the replacement equipment must appear on the ESC Register of Approved Products. Glow Green manages the product verification and compliance documentation on your behalf. Explore Commercial HVAC Upgrades →
Commercial Heat Pump Hot Water — Activity 44 (Important 2026 Update)
From July 2025, Activity 44 — the VEU commercial heat pump hot water activity — has been revised. Businesses considering this upgrade should note the following material changes:
A minimum $1,000 customer co-payment is now mandatory — this upgrade is no longer a zero-cost outcome.
The replacement storage tank must exceed 700 litres in capacity, targeting genuine commercial-scale hot water demand.
VEEC discounts remain available and reduce the overall co-payment and installation cost substantially.
Best-fit premises: gyms, hotels, aged care facilities, accommodation providers, food service operations, and sports clubs.
Glow Green will provide every client with a written quote detailing the exact VEEC value and any co-payment amount before any work is agreed. There are no surprise invoices. Request Written VEEC Quote for Heat Pump
High-Efficiency Motors — Activity 31 (Updated Guides Released 2026)
Activity 31 — the high-efficiency motor replacement activity — has received updated program guides from the ESC in 2026. This activity supports the replacement of standard-efficiency electric motors with high-efficiency equivalents, generating VEECs that offset the cost of the upgrade.
This upgrade is particularly well-suited to Victorian businesses with significant process motor loads: manufacturing facilities, refrigerated cold stores, agricultural pumping operations, and water treatment infrastructure. Motors account for a disproportionate share of industrial electricity consumption — upgrading to IE3 or IE4 efficiency class motors can reduce motor running costs by 20–40%. Enquire About Motor Upgrade Eligibility
Commercial & Industrial Solar PV — Brand New VEU Activity for 2026
A major development in the 2026 VEU program is the addition of a dedicated Commercial & Industrial Solar PV activity to the ESC registry. This applies to solar PV system installations of over 100kW, serving large commercial and industrial premises.
Critically, VEU certificates generated under this activity can be stacked on top of federal Small-scale Technology Certificates (STCs), creating a combined incentive that significantly reduces the capital cost of large-scale solar installation. For eligible premises — large warehouses, industrial estates, shopping centres, agricultural operations — this is the most financially significant upgrade opportunity introduced in 2026.
Updated installation guides and ESC registry forms are now available. Glow Green’s team can assess your site and calculate the combined VEU + STC incentive value for your specific system size and orientation. Assess our Site for C&I Solar
What Does 'Free' Actually Mean? An Honest Breakdown ?
The term ‘free energy upgrade’ is accurate for many activities — but it requires clarification, and Glow Green is committed to providing it. Here is what ‘free’ means in the context of the VEU program:
The VEEC mechanism creates a financial instrument from the greenhouse gas savings your upgrade generates. Glow Green sells those certificates to energy retailers, who are legally obligated to buy them. That sale value — which can equal the full cost of supply and installation for high-volume activities like LED lighting — is passed to you as an upfront discount. No rebate form. No waiting period. No invoice gap.
For most LED lighting retrofits and many HVAC upgrades, the VEEC value exceeds the full project cost and the outcome is genuinely $0 upfront. However, for some activities, a co-payment applies:
Commercial heat pump hot water (Activity 44): minimum $1,000 co-payment — mandatory from July 2025.
Larger HVAC or motor upgrades: VEEC discount reduces but may not fully eliminate the capital cost, depending on system size and site configuration.
Refrigerated display cabinets: incentive currently suspended — no cost offset available.
Glow Green’s transparency commitment: every client receives a written breakdown of the VEEC value and any co-payment before a single piece of equipment is ordered. You will never receive a surprise invoice.
A legitimate accredited provider will always:
- Provide a written quote detailing VEEC value and any co-payment.
- Confirm that both the company and the individual installerare ESC-authorised.
- Never solicit your business through unsolicited telephone calls, SMS, or door-knock approaches.
Does Your Business Qualify ? The Eligibility Checklist
The following criteria apply to most VEU commercial upgrade activities. You are likely eligible if you can confirm all of the following:
Your premises are located anywhere in Victoria — metropolitan or regional.
Your premises are non-residential: commercial, industrial, retail, hospitality, not-for-profit, aged care, school, or any other business-use building.
The equipment being replaced meets the VEU 'before' product criteria — Glow Green verifies this at assessment.
The replacement equipment is listed on the ESC Register of Approved Products.
The installation is completed by an ESC Accredited Person — Glow Green is fully accredited.
You hold a current Australian Business Number (ABN) and the premises is used for business purposes.
Excellent! Your premises appear eligible for the VEU Program.
Get Your Free VEU Assessment NowTakes less than 2 minutes • No obligation • No sales call unless you request one.
⚠️ Note on retrospective rebates:
If you have already completed an eligible upgrade, a retrospective rebate may be available. You can claim a retrospective rebate if it is processed within six months after the end of the calendar year in which the upgrade took place. For example, if your upgrade occurred in 2025, the accredited provider must submit the claim by 30 June 2026. Contact Glow Green promptly if this applies to your situation.
How Glow Green Delivers Your Upgrade : End-to-End, Zero Paperwork
The VEU program is powerful — but navigating the compliance requirements, approved product lists, VEEC calculations, and ESC documentation is a full-time job. Glow Green exists to make that burden zero for your business. Here is our four-step process:
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AssessA Glow Green consultant conducts a free, no-obligation site assessment of your premises. We identify all eligible VEU activities, calculate the VEEC value for each, and flag any co-payments that apply. Zero cost. Zero commitment. |
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QuoteWe provide a written quote detailing the VEEC discount value, any co-payment amount, the specific approved products to be installed, and the projected annual energy savings. You see the numbers before you commit. No surprises — ever. |
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InstallOur ESC-accredited installation team completes the work to program specifications. Both our company and every individual installer are verified and authorised under 2026 ESC standards. |
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CertifyGlow Green handles all VEEC creation, lodgement, and ESC compliance documentation through the Certify Platform — our proprietary real-time certificate management system. You receive easy-to-read documentation for your records. No forms. No paperwork. No follow-up required from your team. |
Glow Green Credentials at a Glance
ESC Accredited Person (AP) | Registered with the Essential Services Commission for all eligible VEU commercial activities |
Certify Platform | Proprietary real-time VEEC creation, tracking, and lodgement system — audit-ready documentation as standard |
Individual Installer Accreditation | All Glow Green tradespeople verified per 2026 ESC individual-enforcement standards |
Transparency Promise | Written VEEC value + co-payment breakdown on every quote, before any commitment |
Real Financial Outcomes: What Victorian Businesses Are Achieving ?
The VEU program has delivered upgrades to over 100,000 Victorian homes and businesses since 2009. For commercial operators, the financial outcomes are material. Victorian businesses accessing VEU-supported HVAC and refrigeration upgrades are currently saving an average of $5,314 per year on utility costs — savings that flow directly to operating margin.
⚠️ Note:
Case studies represent anonymised composite outcomes based on Glow Green client data. Individual results vary based on premises size, equipment type, and energy tariff structure.
Why the Timing of Your Upgrade Matters in 2026 ?
The VEU program is a long-term commitment by the Victorian Government — extended to 2045, it is not going away. However, the value of the discount you receive is not fixed, and 2026 presents a specific timing dynamic that business owners should factor into their planning:
VEEC prices are expected to soften across 2026 as the annual target of 4.4 million certificates is a 40% reduction from 2025’s 7.3 million. Smaller target = fewer certificates required = lower price pressure. Businesses that complete upgrades in Q1 or Q2 will access higher VEEC values — and therefore larger upfront discounts — than those who wait until Q3 or Q4.
A formal strategic review of the VEU program is currently underway (March–April 2026). Proposed legislative changes — including new electrification objectives and more flexible VEEC targets — may alter available activities or eligibility criteria once the Bill passes Parliament.
The refrigerated cabinets activity was suspended in July 2025 with no reinstatement timeline. Other activities are not immune to similar reviews if compliance concerns emerge.
Activity 44 (commercial heat pump hot water) already carries a mandatory co-payment following its July 2025 revision. Deferring decisions does not make upgrades cheaper — it typically makes them more expensive.
FAQ's
About the Author & Publisher
This article was produced by the Glow Green content team. Glow Green (trading name of Accurate Marketing Pty Ltd, ABN 18 606 614 911) is an Accredited Person (AP) under the Victorian Energy Upgrades (VEU) program, administered by the Essential Services Commission of Victoria. Glow Green is also an Accredited Certificate Provider (ACP) under the NSW Energy Savings Scheme (ESS) and a nationally recognised STC aggregator.
All program information in this article has been verified against the Essential Services Commission (ESC) VEU program registry and official Victorian Government guidance current as of April 2026. This article is intended as a general guide only. Program terms, VEEC values, and eligibility criteria are subject to change. Readers should contact Glow Green or the ESC directly to confirm current eligibility before proceeding with any upgrade.
Bibliography
Official Government & Regulatory Sources
[1] Essential Services Commission (ESC) Victoria. About the Victorian Energy Upgrades Program. ESC Victoria, 2026.
[2] Essential Services Commission (ESC) Victoria. Victorian Energy Upgrades Program — Activity Guides: Activity 31 (High-Efficiency Motors) & Activity 44 (Commercial & Industrial Heat Pump Hot Water). ESC Victoria, updated 2026.
[3] Essential Services Commission (ESC) Victoria. Victorian Energy Upgrades Program Fees for 2026 Onwards — Notice of Decision. ESC Victoria, January 2026.
[4] Department of Energy, Environment and Climate Action (DEECA), Victoria. About Victorian Energy Upgrades. State Government of Victoria, updated December 2025.
[5] Department of Climate Change, Energy, the Environment and Water (Australian Government). Victorian Energy Upgrades for Businesses. energy.gov.au, 2026.
[6] Essential Services Commission (ESC) Victoria. 2026 Annual VEEC Target. ESC Victoria, January 2026.
[7] Essential Services Commission (ESC) Victoria. VEU Strategic Review — Stakeholder Consultation. ESC Victoria, March–April 2026.
[8] Essential Services Commission (ESC) Victoria. VEEC Creation Deadline Removal — Program Update. ESC Victoria, May 2025. https://www.esc.vic.gov.au/victorian-energy-upgrades-program Cited for: abolition of 31 January prior-year VEEC lodgement deadline.
[9] Essential Services Commission (ESC) Victoria. Refrigerated Display Cabinets Activity Suspension. ESC Victoria, July 2025.
B. Victorian Government Policy Sources
[10] State Government of Victoria. Victoria’s Climate Change Strategy — 2030 Emissions Reduction Target. Department of Energy, Environment and Climate Action, 2021 (target current as at 2026).
C. Glow Green Internal Sources
[11] Glow Green Pty Ltd. How Victorian Businesses Can Get a Free Energy Upgrade in 2026 — Internal Research Document. glowgreen.com.au, March–April 2026. https://glowgreen.com.au/how-victorian-businesses-can-get-a-free-energy-upgrade-in-2026/
[12] Glow Green Pty Ltd. Certify Platform — Real-Time VEEC Management System. certify.glowgreen.com.au, 2026. https://certify.glowgreen.com.au
D. Legislation
[13] Victorian Government. Victorian Energy Efficiency Target Act 2007 (as amended). Parliament of Victoria.