Brief

Victorian green energy scheme plagued by AI‑faked certificates and consumer losses

Rogue installers have used doctored photos to claim millions in carbon credits, prompting regulator action and consumer hardship.

By Felo News Desk · Published Sun, 18 Oct 2026 04:16:35 GMT

AI‑generated images are being used to fraudulently claim thousands of green certificates under Victoria’s Victorian Energy Upgrades (VEU) scheme, leaving households owed millions in deposits and without warranties for hot‑water systems and air‑conditioners, according to the Sydney Morning Herald.

What happened

The VEU program, which subsidises energy‑saving upgrades for homes and businesses, has seen at least 20 operators suspended or cancelled in the past two years. Some of those firms have entered liquidation after regulator penalties, and consumers have lost deposits worth millions. In September, the Essential Services Commission ordered a business to surrender $230,000 of carbon credits for false claims supported by staged photos. A separate company was banned in August after surrendering 1,228 certificates valued at over $100,000.

What the reports add

The Herald’s investigation, based on company records, enforcement notices and interviews, highlights a surge in doctored images over the last six months, as artificial‑intelligence tools make realistic fake installation photos easy to produce. Installers are using these images to claim Victorian energy efficiency certificates worth $83 each for products such as air‑conditioners, heat pumps and weather seals.

What was said

Commission chair Gerard Brody said the regulator had intensified efforts to curb misconduct over the past 18 months, noting the growing use of AI in fraudulent claims. The article also references an extreme case where an employee of a sustainability firm was pursued by his employer for allegedly diverting $5.9 million of carbon credits to his own business.

How it came about

The VEU scheme, valued at $572 million, has been promoted by the Victorian government as having helped 2.4 million households and 180,000 businesses. The program will become the primary channel for all solar rebates next year, increasing scrutiny on its integrity. Earlier Felo coverage on energy regulation, such as the Martin Lewis Ofgem charge story, provides context on how regulator actions can affect consumer costs.

Key facts

• AI‑generated images are being used to claim false green certificates in Victoria's VEU scheme. (smh.com.au)
• At least 20 businesses have been suspended or cancelled from the scheme in the past two years. (smh.com.au)
• The Essential Services Commission ordered a $230,000 carbon‑credit surrender in September for false claims. (smh.com.au)
• Commission chair Gerard Brody said regulator efforts to stop bad behaviour have ramped up over the past 18 months. (smh.com.au)
• Consumers face millions in missing deposits and loss of warranties for hot‑water systems and air‑conditioners. (smh.com.au)

Sources

• [1] smh.com.au — originally reported as “Deposits lost, warranties wiped: Consumers hit by green energy scheme chaos”