diff --git a/Makefile b/Makefile
index 158056a500..903c2a3ee9 100644
--- a/Makefile
+++ b/Makefile
@@ -22,7 +22,7 @@ DOCKER_PREFIX:=${DOCKER_REGISTRY}$(DOCKER_REPOSITORY)
 GIT_MASTER_HEAD_SHA:=$(shell git rev-parse --short --verify HEAD)
 
 TEMPLATE_URL:=https://github.com/SwissDataScienceCenter/renku-project-template
-TEMPLATE_REFERENCE:=0.3.0
+TEMPLATE_REFERENCE:=$(shell sed -n -E 's/^__template_version__ = "([^"]+)"/\1/p' renku/version.py)
 TEMPLATE_DIR:=renku/templates/
 
 .PHONY: service cli docker-tag docker-push docker-login
@@ -47,6 +47,7 @@ cli:
 	docker build -f Dockerfile -t $(DOCKER_PREFIX)renku-python:`git rev-parse --short HEAD` --build-arg CLEAN_INSTALL=1 .
 
 download-templates:
+	@[ "${TEMPLATE_REFERENCE}" ] || ( echo "__template_version__ is not set"; exit 1 )
 	@echo "Downloading templates"
 	rm -rf $(TEMPLATE_DIR)
 	mkdir -p $(TEMPLATE_DIR)
diff --git a/renku/__init__.py b/renku/__init__.py
index 8d7c626be1..e3168beabb 100644
--- a/renku/__init__.py
+++ b/renku/__init__.py
@@ -19,6 +19,6 @@
 
 from __future__ import absolute_import, print_function
 
-from renku.version import __version__
+from renku.version import __template_version__, __version__
 
-__all__ = ("__version__",)
+__all__ = ("__template_version__", "__version__")
diff --git a/renku/cli/dataset.py b/renku/cli/dataset.py
index 65fb8e96d9..d46b8d6ad0 100644
--- a/renku/cli/dataset.py
+++ b/renku/cli/dataset.py
@@ -1000,7 +1000,7 @@ def update(names, creators, include, exclude, ref, delete, external, no_external
         def get_dataset_files(records):
             from renku.core.commands.format.tabulate import tabulate
 
-            columns = {"path": ("path", None), "dataset": ("dataset.name", None), "external": ("external", None)}
+            columns = {"path": ("path", None), "dataset": ("dataset.name", "dataset"), "external": ("external", None)}
             return tabulate(collection=records, columns="path,dataset,external", columns_mapping=columns)
 
         if not datasets and not dataset_files:
diff --git a/renku/core/commands/view_model/template.py b/renku/core/commands/view_model/template.py
index 8d8d43501b..5c1a82fbe4 100644
--- a/renku/core/commands/view_model/template.py
+++ b/renku/core/commands/view_model/template.py
@@ -73,7 +73,7 @@ def from_template(cls, template: Template) -> "TemplateViewModel":
             parameters=template.parameters,
             icon=template.icon,
             immutable_files=template.immutable_files,
-            versions=template.get_all_versions(),
+            versions=template.get_all_references(),
         )
 
 
diff --git a/renku/core/management/template/template.py b/renku/core/management/template/template.py
index ab601007de..ea1d41fc3f 100644
--- a/renku/core/management/template/template.py
+++ b/renku/core/management/template/template.py
@@ -354,48 +354,42 @@ def read_valid_value(var: TemplateParameter, default_value=None):
 class EmbeddedTemplates(TemplatesSource):
     """Represent templates that are bundled with Renku.
 
-    For embedded templates, ``source`` is "renku" and ``version`` is set to the installed Renku version. ``reference``
-    should not be set for such projects.
+    For embedded templates, ``source`` is "renku". In the old versioning scheme, ``version`` is set to the installed
+    Renku version and ``reference`` is not set. In the new scheme, both ``version`` and ``reference`` are set to the
+    template version.
     """
 
     @classmethod
     def fetch(cls, source: Optional[str], reference: Optional[str]) -> "EmbeddedTemplates":
         """Fetch embedded Renku templates."""
-        from renku import __version__
-
-        if reference and reference != "master":
-            raise errors.ParameterError("Templates included in renku don't support specifying a template reference")
+        from renku import __template_version__
 
         path = importlib_resources.files("renku") / "templates"
         with importlib_resources.as_file(path) as folder:
             path = Path(folder)
 
-        return cls(path=path, source="renku", reference=None, version=str(__version__))
-
-    def is_update_available(self, id: str, reference: Optional[str], version: Optional[str]) -> Tuple[bool, str]:
-        """Return True if an update is available along with the latest version of a template."""
-        latest_version = self.get_latest_version(id=id, reference=reference, version=version)
-        update_available = latest_version is not None and latest_version != version
-
-        return update_available, latest_version
+        return cls(path=path, source="renku", reference=__template_version__, version=__template_version__)
 
-    def get_all_versions(self, id) -> List[str]:
-        """Return all available versions for a template id."""
+    def get_all_references(self, id) -> List[str]:
+        """Return all available references for a template id."""
         template_exists = any(t.id == id for t in self.templates)
-        return [self.version] if template_exists else []
+        return [self.reference] if template_exists else []
 
-    def get_latest_version(self, id: str, reference: Optional[str], version: Optional[str]) -> Optional[str]:
-        """Return latest version number of a template."""
+    def get_latest_reference_and_version(
+        self, id: str, reference: Optional[str], version: Optional[str]
+    ) -> Optional[Tuple[str, str]]:
+        """Return latest reference and version number of a template."""
         if version is None:
             return
+        elif reference is None or reference != version:  # Old versioning scheme
+            return self.reference, self.version
 
-        template_version = Version(self.version)
         try:
             current_version = Version(version)
         except ValueError:  # NOTE: version is not a valid SemVer
-            return str(template_version)
+            return self.reference, self.version
         else:
-            return str(template_version) if current_version < template_version else version
+            return (self.reference, self.version) if current_version < Version(self.version) else (reference, version)
 
     def get_template(self, id, reference: Optional[str]) -> Optional["Template"]:
         """Return all available versions for a template id."""
@@ -432,14 +426,7 @@ def fetch(cls, source: Optional[str], reference: Optional[str]) -> "RepositoryTe
 
         return cls(path=path, source=source, reference=reference, version=version, repository=repository)
 
-    def is_update_available(self, id: str, reference: Optional[str], version: Optional[str]) -> Tuple[bool, str]:
-        """Return True if an update is available along with the latest version of a template."""
-        latest_version = self.get_latest_version(id=id, reference=reference, version=version)
-        update_available = latest_version is not None and latest_version != reference
-
-        return update_available, latest_version
-
-    def get_all_versions(self, id) -> List[str]:
+    def get_all_references(self, id) -> List[str]:
         """Return a list of git tags that are valid SemVer and include a template id."""
         versions = []
         for tag in self.repository.tags:
@@ -454,8 +441,10 @@ def get_all_versions(self, id) -> List[str]:
 
         return [str(v) for v in sorted(versions)]
 
-    def get_latest_version(self, id: str, reference: Optional[str], version: Optional[str]) -> Optional[str]:
-        """Return latest version number of a template."""
+    def get_latest_reference_and_version(
+        self, id: str, reference: Optional[str], version: Optional[str]
+    ) -> Optional[Tuple[str, str]]:
+        """Return latest reference and version number of a template."""
         if version is None:
             return
 
@@ -463,11 +452,11 @@ def get_latest_version(self, id: str, reference: Optional[str], version: Optiona
 
         # NOTE: Assume that a SemVer reference is always a tag
         if tag:
-            versions = self.get_all_versions(id=id)
-            return versions[-1] if len(versions) > 0 else None
+            references = self.get_all_references(id=id)
+            return (references[-1], self.version) if len(references) > 0 else None
 
         # NOTE: Template's reference is a branch or SHA and the latest version is RepositoryTemplates' version
-        return self.version
+        return reference, self.version
 
     def _has_template_at(self, id: str, reference: str) -> bool:
         """Return if template id is available at a reference."""
diff --git a/renku/core/management/template/usecase.py b/renku/core/management/template/usecase.py
index 92f5a1141a..42bc03ff15 100644
--- a/renku/core/management/template/usecase.py
+++ b/renku/core/management/template/usecase.py
@@ -70,13 +70,11 @@ def check_for_template_update(client) -> Tuple[bool, bool, Optional[str], Option
     metadata = TemplateMetadata.from_client(client=client)
 
     templates_source = fetch_templates_source(source=metadata.source, reference=metadata.reference)
-    latest_version = templates_source.get_latest_version(
+    update_available, latest_reference = templates_source.is_update_available(
         id=metadata.id, reference=metadata.reference, version=metadata.version
     )
 
-    update_available = latest_version is not None and latest_version != metadata.version
-
-    return update_available, metadata.allow_update, metadata.version, latest_version
+    return update_available, metadata.allow_update, metadata.reference, latest_reference
 
 
 @inject.autoparams("client_dispatcher")
@@ -130,7 +128,7 @@ def update_template(
 
     templates_source = fetch_templates_source(source=template_metadata.source, reference=template_metadata.reference)
 
-    update_available, latest_version = templates_source.is_update_available(
+    update_available, latest_reference = templates_source.is_update_available(
         id=template_metadata.id, reference=template_metadata.reference, version=template_metadata.version
     )
 
@@ -139,7 +137,7 @@ def update_template(
 
     rendered_template, actions = _set_or_update_project_from_template(
         templates_source=templates_source,
-        reference=latest_version,
+        reference=latest_reference,
         id=template_metadata.id,
         interactive=interactive,
         dry_run=dry_run,
diff --git a/renku/core/models/template.py b/renku/core/models/template.py
index 309b826675..9226e8e52c 100644
--- a/renku/core/models/template.py
+++ b/renku/core/models/template.py
@@ -60,19 +60,26 @@ def templates(self) -> List["Template"]:
 
         return self.manifest.templates
 
-    @abstractmethod
     def is_update_available(self, id: str, reference: Optional[str], version: Optional[str]) -> Tuple[bool, str]:
-        """Return True if an update is available along with the latest version of a template."""
-        raise NotImplementedError
+        """Return True if an update is available along with the latest reference of a template."""
+        latest = self.get_latest_reference_and_version(id=id, reference=reference, version=version)
+        if not latest:
+            return False, reference
+
+        latest_reference, latest_version = latest
+        update_available = latest_reference != reference or latest_version != version
+        return update_available, latest_reference
 
     @abstractmethod
-    def get_all_versions(self, id) -> List[str]:
+    def get_all_references(self, id) -> List[str]:
         """Return all available versions for a template id."""
         raise NotImplementedError
 
     @abstractmethod
-    def get_latest_version(self, id: str, reference: Optional[str], version: Optional[str]) -> Optional[str]:
-        """Return latest version number of a template."""
+    def get_latest_reference_and_version(
+        self, id: str, reference: Optional[str], version: Optional[str]
+    ) -> Optional[Tuple[str, str]]:
+        """Return latest reference and version number of a template."""
         raise NotImplementedError
 
     @abstractmethod
@@ -220,9 +227,9 @@ def templates_source(self, templates_source: TemplatesSource):
         self.version = templates_source.version
         self.path = templates_source.path / self.id
 
-    def get_all_versions(self) -> List[str]:
-        """Return all available versions for the template."""
-        return self.templates_source.get_all_versions(self.id)
+    def get_all_references(self) -> List[str]:
+        """Return all available references for the template."""
+        return self.templates_source.get_all_references(self.id)
 
     def validate(self, skip_files):
         """Validate a template."""
diff --git a/renku/version.py b/renku/version.py
index f0e14c1893..7004259ffa 100644
--- a/renku/version.py
+++ b/renku/version.py
@@ -25,6 +25,7 @@
     from importlib_metadata import distribution
 
 __version__ = "0.0.0"
+__template_version__ = "0.3.0"
 
 
 def is_release():
diff --git a/tests/cli/test_template.py b/tests/cli/test_template.py
index ad0926b7e1..bebd3d3ded 100644
--- a/tests/cli/test_template.py
+++ b/tests/cli/test_template.py
@@ -80,7 +80,7 @@ def test_template_show(isolated_runner):
         result = isolated_runner.invoke(cli, command + ["R-minimal"])
 
         assert 0 == result.exit_code, format_result_exception(result)
-        assert "Name: Basic R (4.1.2) Project" in result.output
+        assert re.search("^Name: Basic R (.*) Project$", result.output, re.MULTILINE) is not None
     finally:
         sys.argv = argv
 
@@ -90,7 +90,7 @@ def test_template_show_no_id(runner, client):
     result = runner.invoke(cli, ["template", "show"])
 
     assert 0 == result.exit_code, format_result_exception(result)
-    assert "Name: Basic Python (3.9) Project" in result.output
+    assert re.search("^Name: Basic Python (.*) Project$", result.output, re.MULTILINE) is not None
 
 
 def test_template_show_no_id_outside_project(isolated_runner):
@@ -136,11 +136,15 @@ def test_template_set_failure(runner, client, client_database_injection_manager)
 
 def test_template_set(runner, client, client_database_injection_manager):
     """Test setting a new template in a project."""
+    from renku.version import __template_version__
+
     result = runner.invoke(cli, ["template", "set", "--force", "R-minimal"])
 
     assert 0 == result.exit_code, format_result_exception(result)
     with client_database_injection_manager(client):
         assert "R-minimal" == client.project.template_id
+        assert __template_version__ == client.project.template_version
+        assert __template_version__ == client.project.template_ref
 
 
 def test_template_set_overwrites_modified(runner, client, client_database_injection_manager):
diff --git a/tests/fixtures/templates.py b/tests/fixtures/templates.py
index 314e198ac3..703412f2bf 100644
--- a/tests/fixtures/templates.py
+++ b/tests/fixtures/templates.py
@@ -32,7 +32,7 @@ def template_metadata():
     """Default template metadata."""
     yield {
         "__template_source__": "renku",
-        "__template_ref__": "master",
+        "__template_ref__": renku_version,
         "__template_id__": "python-minimal",
         "__namespace__": "",
         "__repository__": "",
@@ -172,18 +172,21 @@ def fetch(cls, source: Optional[str], reference: Optional[str]) -> "TemplatesSou
 
         def is_update_available(self, id: str, reference: Optional[str], version: Optional[str]) -> Tuple[bool, str]:
             """Return True if an update is available along with the latest version of a template."""
-            latest_version = self.get_latest_version(id=id, reference=reference, version=version)
+            _, latest_version = self.get_latest_reference_and_version(id=id, reference=reference, version=version)
 
             return latest_version != version, latest_version
 
-        def get_all_versions(self, id) -> List[str]:
-            """Return all available versions for a template id."""
+        def get_all_references(self, id) -> List[str]:
+            """Return all available references for a template id."""
             return [str(v) for v in self._versions]
 
-        def get_latest_version(self, id: str, reference: Optional[str], version: Optional[str]) -> Optional[str]:
-            """Return latest version number of a template."""
+        def get_latest_reference_and_version(
+            self, id: str, reference: Optional[str], version: Optional[str]
+        ) -> Optional[Tuple[str, str]]:
+            """Return latest reference and version number of a template."""
             _ = self.get_template(id=id, reference=reference)
-            return str(max(self._versions))
+            version = str(max(self._versions))
+            return version, version
 
         def get_template(self, id, reference: Optional[str]) -> Optional[Template]:
             """Return a template at a specific reference."""