Overview

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The World is in a transition phase and energy is central to it. India has been responsible for almost 10% of the increase in global energy demand since 2000. India’s energy demand in this period has almost doubled, pushing the country’s share in global demand up to 5.7% in 2013 from 4.4% at the beginning of the century. The primary energy demand in India has grown from about 441 Mtoe in 2000 to about 775 Mtoe in 2013. This demand is expected to increase to about 1250 (estimated by International Energy Agency) to 1500 (estimated in the Integrated Energy Policy Report) million toe in 2030. India’s energy consumption has almost doubled since 2000 and the potential for further rapid growth is enormous. Yet the increase in domestic energy production is far below than India’s consumption needs. By 2040 more than 40% of primary energy supply will be imported, up from 32% in 2013. It may also be noted that no country in the world has been able to achieve a Human Development Index of 0.9 or more without an annual energy supply of at least 4 toe per capita. Consequently, there is a large latent demand for energy services that needs to be fulfilled in order for people to have reasonable incomes and a decent quality of life.

 

Improving the energy efficiency meets the dual objectives of promoting sustainable development and of making the economy competitive. Recognizing the formidable challenges of meeting the energy needs and providing adequate and varied energy of desired quality in a sustainable manner and at reasonable costs, improving efficiency have become important components of energy policy. In addition, the environmental and health burdens arising out of the use of hydrocarbons may also force mankind towards energy efficiency and clean energy systems. Energy Conservation has also assumed enhanced importance with a view to conserve depleting energy resources.

Government of India has undertaken a two pronged approach to cater to the energy demand of its citizens while ensuring minimum growth in CO2 emissions, so that the global emissions do not lead to an irreversible damage to the earth system. On one hand, in the generation side, the Government is promoting greater use of renewable in the energy mix mainly through solar and wind and at the same time shifting towards supercritical technologies for coal based power plants. On the other side, efforts are being made to efficiently use the energy in the demand side through various innovative policy measures under the overall ambit of Energy Conservation Act 2001.

The Energy Conservation Act (EC Act) was enacted in 2001 with the goal of reducing energy intensity of Indian economy. Bureau of Energy Efficiency (BEE), a statutory body under Ministry of Power is responsible for spearheading the improvement of energy efficiency in the economy through various regulatory and promotional instruments.  Bureau of Energy Efficiency (BEE) was set up as the statutory body on 1st March 2002 at the central level to facilitate the implementation of the EC Act. The Act provides regulatory mandate for: standards & labelling of equipment and appliances; energy conservation building codes for commercial buildings; and energy consumption norms for energy intensive industries. In addition, the Act enjoins the Central Govt. and the Bureau to take steps to facilitate and promote energy efficiency in all sectors of the economy. The Act also directs states to designate agencies for the implementation of the Act and promotion of energy efficiency in the state.

Ministry of Power, through Bureau of Energy Efficiency (BEE), has initiated a number of energy efficiency initiatives in the areas of household lighting, commercial buildings, standards and labelling of appliances, demand side management in agriculture/municipalities, SME's and large industries including the initiation of the process for development of energy consumption norms for industrial sub sectors, capacity building of SDA's etc.

 

SCHEMES TO PROMOTE ENERGY CONSERVATION AND ENERGY EFFICIENCY

 

1.         Standard & Labeling Programme

The Energy Conservation Act, 2001, under section 14, empowers the Central Government to develop a standards and labeling(S&L) program which was formally launched on May 18, 2006, by the Ministry of Power, Government of India. The Bureau of Energy Efficiency (BEE) defines the energy performance standards for appliances and equipment and promotes and facilitates its adoption through several training, awareness and capacity building programs. The S&L scheme, a flagship program of BEE, is one of the most cost effective policy tool for improving appliance and equipment energy efficiency and lowering energy costs to the consumer. Mandatory energy efficiency standards coupled with labels that describe energy performance enable consumers to make informed choice for purchasing efficient products that save energy and reduce expenses.

 

The scheme is invoked for 21 equipment/appliances, out of 21 appliances, 8 appliances are under mandatory domain and remaining 13 appliances are under voluntary domain.

The energy efficiency labeling programs under BEE are intended to reduce the energy consumption of appliance without diminishing the services it provides to consumers. Further, the standards and label for refrigerators and air-conditioners have been periodically made more stringent. As a result, the least-efficient products are removed from the market and more efficient products are introduced. The Corporate Average Fuel Consumption Standards (CAFC) for passenger cars has been notified on 3rd April, 2015.

 

As on date, the S&L program covers 21 appliances out of which labelling of eight appliances have been made mandatory. The detailed list is as follows:

S. No

Appliance

Mandatory Appliances

1.             

Household Frost Free Refrigerators

2.             

Window and High wall split Air Conditioners

3.             

Tubular Fluorescent Lamps

4.             

Distribution Transformers

5.             

Ceiling mounted and Floor standing Air Conditioner

6.             

Direct Cool Refrigerator

7.             

Color Television

8.             

Storage Type Electric Water Heater

Voluntary Appliance

9.             

Induction Motor

10.           

Agricultural Pump sets

11.           

Ceiling Fan

12.           

Domestic Liquefied Petroleum Gas Stoves

13.           

Washing Machine

14.           

Computer (Notebook/Laptops)

15.           

Blast (Electronic/Magnetic)

16.           

Office Equipments(Printer, Copier, Scanner, MFD’s)

17.           

Diesel Engine Driven Mono set pumps for agricultural purposes

18.           

Solid State Inverter

19.           

Diesel Generator

20.           

Variable Capacity Air Conditioners

21.           

LED Lamps

1.         Energy Conservation Building Code (ECBC) & Energy Efficiency in Existing Buildings

The Energy Conservation Building Code (ECBC) was notified by Govt. of India for new commercial buildings on 27th May 2007. ECBC sets minimum energy standards for new commercial buildings having a connected load of 100kW or contract demand of 120 KVA and above. While the Central Government has powers under the EC Act 2001, the state governments have the flexibility to modify the code to suit local or regional needs and notify them. The ECBC defines norms of energy performance and takes into consideration the climatic regions of the country where the building is located. The major components of the building which are being addressed through the code are:

·         Envelope (walls, roofs, windows)

·         Lighting systems

·         HVAC System

·         Water heating and pumping system

·         Electrical Power System

 

Currently ten States and Union Territories (Rajasthan, Odisha, UT of Puducherry, Uttrakhand, Punjab, Karnataka, Andhra Pradesh, Telangana, Haryana, West Bengal) notified and adopted the code for their states. In order to promote a market pull for energy efficient buildings, Bureau of Energy Efficiency developed a voluntary Star Rating Programme for buildings which is based on the actual performance of a building, in terms of energy usage in the building over its area expressed in kWh/sq. m/year. Currently, Voluntary Star Labeling programme for 4 categories of buildings (day use office buildings/BPOs/Shopping malls/Hospitals) has been developed and put in public domain. More than 150 commercial buildings have been star rated under different categories.

 

 

2.     Demand Side Management

(a)          Agricultural Demand Side Management (AgDSM) Scheme

India’s Agriculture sector consumes nearly 18% of total National electricity consumption in India with approximately 21 million pumpsets in the country. Statistics shows that 2.5–5 lakhs new pumpset connections added every year to the sector, most of the pumpsets installed are inefficient having average efficiency of 25-35% whereas star rated Energy Efficient Pumpsets (EEPS) have efficiency level of 45-50%. Studies reveal that energy saving potential of 25-40% exists by mere replacement of in-efficient pumps with energy efficient pumps.

Various activities are being carried out to promote energy efficiency in Agriculture sector, facilitating State Governments to issue state wide notification for mandating the usage of EEPS (Energy Efficient Pump Sets) for all new agriculture connections. Country wide capacity building sessions are being conducted for farmers on energy efficiency & conservation for agricultural pumps.

The First Agriculture Demand Side Management pilot project is being implemented in Solapur, Maharashtra reflecting savings of 6.1 Million Units by efficiency up gradation of 2209 pump sets. Other three pilot projects are being also implemented in Karnataka and Andhra Pradesh. Large scale pump up-gradation programs are at various stages of implementation in agriculture intensive states like Maharashtra, Andhra Pradesh & Karnataka. These projects will attract significant investments and will also provide large employment to the rural technicians.

The States of Haryana, Punjab, Kerala and Karnataka have already issued state wide mandatory notification for using Energy Efficient Agriculture Pumps. Some states like Chhattisgarh and Rajasthan are offering incentives to agriculture consumers for adoption of Energy Efficient Pumpsets.

(b)       Municipal Demand Side Management (Mu-DSM)

Identifying the immense energy saving potential in municipal sector, BEE initiated Municipal Demand Side Management (MuDSM) proposed Scheme. Implementation of the project at the ground level is highly necessary which will create a market transformation among technology provider, implementing partners, financial institutions etc. The programme is planned to cover 134 municipalities in the country by conducting investment grade energy audits and preparation of Detailed Project Reports (DPRs) and implementation through ESCO mode. The basic objective of the project was to improve the overall energy efficiency of the ULBs, which could lead to substantial savings in the electricity consumption, thereby resulting in cost reduction/savings for the ULBs.

 

The major achievements are as follows.

  • Situational survey was conducted in 175 ULBs across the country.
  • In 134 ULBs, Bankable DPRs were prepared after taking up Investment Grade Energy Audit (IGEA). The overall potential saving of 120 MW is estimated as part of avoided generation capacity through energy efficiency projects in 134 ULBs.

 

Implementation of the project at the ground level is highly necessary which will create a market transformation among technology provider, implementing partners, financial institutions etc. In view of these facts, it is proposed that implementation of demo projects in 15 ULBs will be undertaken on pilot basis during XII plan.

(c)       Capacity Building of DISCOMS:

The objective of the programme is capacity building of DISCOMs for carrying out load management programme, energy conservation programme, development of DSM action plan and implementation of DSM activities in their respective areas. This programme would help the DISCOMs for reducing peak electricity demand so that they can delay building further capacity. Following activities are undertaken under this scheme.

·         34 DISCOMs have been selected for participating in the scheme and MoU are also signed.

·         DSM regulation notified in 18 States for 27 DISCOMs. 

·         National Power Training Institute was engaged by BEE to conduct training programmes for the officials of DISCOMs to create Master Trainers on DSM and energy efficiency under this programme.

·         504 officials from 32 DISCOMs have been trained as Master Trainers under Training of Trainers activity. Four agencies have been selected for organizing training programmes for the circle level officials of DISCOMs.

·         About 5000 officials are expected to participate in theses training programmes.

 

(d)  Energy Efficiency in Small and Medium Enterprises (SMEs) sector

 

The manufacturing sector in India, constituting 80 per cent of MSMEs, forms an important segment to achieve sustainable growth patterns. Cost of energy is considered a vital component for manufacturing units and spiraling power costs, energy efficiency assumes utmost importance for the sector to remain competitive. To encourage the energy efficient technologies and operational practices in SME sectors in India, BEE has initiated the energy efficiency interventions in selected 25 SMEs clusters during the XI plan. A study was conducted to assess energy use and technology gap at unit level, development of the cluster specific energy efficiency manuals, preparation of Detailed Project Reports (DPRs) on energy efficient technologies and capacity building and knowledge enhancement of man-force involved in SMEs. During the XII plan, implementations of 100 technologies of 10 best technologies in 5 SME sectors [Pali (Textile), Varanasi (Brick), Ludhiana (Forging), Indore (Food) and Kochi (Sea food cluster)] demonstration projects in 5 SME sectors are envisaged to facilitate large scale replication. Baseline Energy Audit in selected units of all the 5 clusters is completed and best energy efficiency technologies are identified for implementation. Implementation of identified energy efficient technologies and post implementation energy audit is also completed in 2 units of Varanasi (Brick) cluster, 7 units of Ludhiana (Forging) cluster and 7 units of Indore (Food) cluster.

 

3.     Strengthening Institutional Capacity of States

(a)   Strengthening of State Designated Agency (SDAs):

As has been mentioned earlier, the implementation and enforcement of the provisions of the Energy Conservation Act in the states is to be carried out by SDAs. As on date, the SDAs have been set up in 32 states by designating one of the existing organizations as required under section 15 (d) of the Energy Conservation Act 2001. These agencies differ from State to State with the Renewable Energy Development Agency (44%), Electrical Inspectorate (25%), Distribution Companies (12%), Power Departments (16%) and others (3%).In order to kick start the energy conservation activities at the state level with an emphasis on building institutional capacities of the SDAs, Ministry of Power had approved the scheme of Providing financial assistance to the State Designated Agencies for strengthening their institutional capacities and capabilities during the XI plan. This has resulted in the following:

  • 59 demonstration projects in the areas of street lights and water pumping systems have been successfully completed by SDAs till date.
  • LED Village Campaign has been successfully implemented by 27 States as on date.
  • Under IGEA of the Govt. Buildings, 491 Govt. buildings have been taken up for energy audit by BEE empanelled ESCOs.

·         Workshops / training programmes involving the Energy Managers / Energy Auditors and Designated Consumers appraising about their roles as per the mandate of the Energy Conservation Act 2001 have been organized by the SDAs.

·         Media / awareness campaign in all the States has been undertaken by the SDAs. The major focus area were promotion through electronic and print media, translation of BEE materials to local languages, awareness campaign in schools / colleges, and through brochures, banners etc.

·         Most of the SDAs are celebrating Energy Conservation Day with due recognition given to those who have taken lead in promoting the cause of energy efficiency in the State.

·         A verified avoided capacity of 1065 MW has been reported by the SDAs during the XI plan

 

(b)   Contribution to State Energy Conservation Fund (SECF) Scheme:

The State Energy Conservation Fund (SECF) is an instrument to overcome the major barriers for implementation of energy efficiency projects. The contribution under State Energy Conservation Fund (SECF) was made to those State Govt. / UT Administration who have created their SECF and finalized the rules and regulations to operationalize the same. The scheme was for contribution to all the State/UTs with a maximum ceiling of Rs. 4.00 crores for any State/UT provided in two instalments of Rs. 2.00 crores each. The second installment of contribution to SECF was released only after the states have provided a matching contribution to the BEE's first installment. The terms and conditions for release of financial assistance under Contribution to SECF remains the same during the 12th plan, only with exemption for North Eastern States. The matching contribution by State Government for North Eastern States is relaxed to Rs 25 lakhs instead of Rs 2.0 crores. Till date, an amount of Rs 82 crores has been disbursed to 26 states. Out of these, 15 states have provided matching contribution.

 

4.      School Education Program

Considering the need to make the next generation more aware regarding efficient use of energy resources, it is necessary to introduce children during their school education. In this regard, promotion of energy efficiency in schools is being promoted through the establishment of Energy Clubs. Bureau of Energy Efficiency is implementing the Students Capacity Building Programme under Energy Conservation awareness scheme for XII five year plan and intends to prepare the text/material on Energy Efficiency and Conservation for its proposed incorporation in the existing science syllabi and science text books of NCERT for classes 6th to 10th.

 

5.          Human Resource Development (HRD)

The potential for improvement of energy efficiency of processes and equipment through awareness creation is vast. A sound policy for creation, retention and up gradation of skills of Human Resources is very crucial for penetration of energy efficient technologies and practices in various sectors. The component under HRD comprises of theory cum practice oriented training programme and providing Energy Audit Instrument Support.

6.         National Mission for Enhanced Energy Efficiency (NMEEE)

The National Mission for Enhanced Energy Efficiency (NMEEE) is one of the eight missions under the National Action Plan on Climate Change (NAPCC). NMEEE aims to strengthen the market for energy efficiency by creating conducive regulatory and policy regime and has envisaged fostering innovative and sustainable business models to the energy efficiency sector. The Cabinet had approved the NMEEE document, and funding for two years of the 11th Plan period (2010-12) with an outlay of Rs.235.50 crore. Continuation of NMEEE for the 12th Plan was approved by Cabinet on 6th August, 2014 with a total outlay of Rs. 775 crore. The Mission seeks to upscale the efforts to unlock the market for energy efficiency which is estimated to be around Rs. 74,000 crore. The activities during the 11th Plan period created the institutional and regulatory infrastructure. The NMEEE spelt out four initiatives to enhance energy efficiency in energy intensive industries which are as follows:

(a)       Perform, Achieve and Trade Scheme (PAT), a market based mechanism to enhance the cost effectiveness in improving the Energy Efficiency in Energy Intensive industries through certification of energy saving which can be traded.

(b)       Market Transformation for Energy Efficiency (MTEE), for accelerating the shift to energy efficient appliances in designated sectors through innovative measures to make the products more affordable.

(c)       Energy Efficiency Financing Platform (EEFP), for creation of mechanisms that would help finance demand side management programmes in all sectors by capturing future energy savings.

(d)       Framework for Energy Efficient Economic Development (FEEED), for development of fiscal instruments to promote energy efficiency.

(a)       Perform Achieve and Trade Scheme (PAT)

PAT scheme is a regulatory instrument to reduce specific energy consumption in energy intensive industries, with an associated market based mechanism to enhance the cost effectiveness through certification of excess energy saving which can be traded.

1.   PAT Cycle-I (2012-13 to 2014-15)

PAT Cycle-I was envisaged to reduce the SEC of 478 industrial units in eight s-ectors viz. Aluminium, Cement, Chlor- Alkali, Fertilizer, Iron & Steel, Paper & Pulp, Thermal Power Plant and Textile. The overall energy saving targets for PAT Cycle –I was 6.686 Million Tonne of Oil Equivalent (MTOE) by the end of 2014-15. The achievement in PAT Cycle-I is 8.67 MTOE which is an over achievement of about 30 percent in comparison to the assigned targets. This energy saving translates in to avoiding of about 5,635 MW demand and about 31 million tonne of CO2 emission.

2.   PAT Cycle –II (2016-17 to 2018-19)

PAT scheme was widened – to include new sectors and deepened – to incorporate new DCs from the existing sectors. For PAT Cycle –II three new sectors viz. Railways, Refineries and DISCOMs were notified. PAT Cycle-II has been notified on 31st March, 2016 and aims to achieve an overall energy consumption reduction of 8.869 MTOE. Under PAT Cycle-II, energy reduction targets have been assigned and notified to 621 DCs. This energy saving will translate in to avoiding of about 5,764 MW of demand.

A cadre of professionally qualified energy managers and auditors with expertise in policy analysis, project management, financing and implementation of energy efficiency projects is being developed through certification programme. BEE has been designing training modules and regularly conducting a National level examination for certified energy managers and energy auditors. Till date, 16 National Certification examinations for Energy Managers and Energy Auditors have successfully been conducted. India now has 12228 Certified Energy Managers, out of which 8536 are additionally qualified as Certified Energy Auditors till date. This is further supplemented by the accreditation of energy auditors through recommendations of “Accreditation Advisory Committee”. Accredited energy auditors would undertake mandatory energy audits in energy intensive industry as mandated in EC Act. As on date, there are 221 accredited energy auditors.

(b) Market Transformation for Energy Efficiency (MTEE): Under MTEE, two programmes have been developed i.e. Bachat Lamp Yojana (BLY) and Super Efficient Equipment Programme (SEEP).

(c) Energy Efficiency Financing Platform (EEFP): Under this programme, MoUs with M/s. PTC India Ltd, M/s. SIDBI, HSBC Bank, Tata Capital and IFCI Ltd have been signed by BEE to promote financing for energy efficiency projects. BEE has signed MoU with Indian Banks Association for the Training Programme for Scheduled Commercial Banks on Energy Efficiency Financing.

(d) Framework for Energy Efficient Economic Development (FEEED): Under this initiative two funds have been created viz. Partial Risk Guarantee Fund for Energy Efficiency (PRGFEE) and Venture Capital Fund for Energy Efficiency (VCFEE).

A. Partial Risk Guarantee Fund for Energy Efficiency (PRGFEE): Partial Risk Guarantee Fund for Energy Efficiency (PRGFEE) is risk sharing mechanism to provide commercial banks with a partial coverage of risk involved in extending loans for energy efficiency projects. The guarantee will not exceed Rs. 10 crore per project or 50% of loan amount, whichever is less. Sectors covered under PRGFEE are government buildings, private buildings having commercial or multi-storey residential accommodations, municipalities, SMEs and industry.

B. Venture Capital Fund for Energy Efficiency (VCFEE): A single investment by the fund shall not exceed Rs. 2 crore. The Fund shall provide last mile equity support to specific energy efficiency projects, limited to a maximum of 15% of total equity required, through Special Purpose Vehicles or Rs. 2 crore, whichever is less. Sectors covered under VCFEE are government buildings, private buildings and municipalities. MoP has constituted Board of Trustees for VCFEE. The VCFEE trust was registered on 7th July 2015 for operationalizing the VCFEE.

 

8.  National Energy Conservation Award and Painting Competition

The National Energy Conservation Awards are presented to industry and other establishments and prizes to the winners of the annual Painting Competition on Energy Conservation for school children every year by the Ministry of Power with the objective of promoting energy conservation among all sectors of economy.

·         National Energy Conservation Awards: The annual energy conservation awards recognize innovation and achievements in energy conservation by the industries, buildings, zonal railways, state designated agencies; manufacturers of BEE star labelled appliances, electricity distribution companies, municipalities and raise awareness that energy conservation plays a big part in India’s response to reducing global warming through energy savings. The awards are also recognition of their demonstrated commitment to energy conservation and efficiency. The responses among the industrial and commercial units have become very encouraging as is evident from the increasing participation level. Salient achievements of EC Award 2016:

·           All participating units have collectively achieved an annual energy savings of 7378 millon units of electricity in 2016 in comparison to 2598 million units in 2015, which is 2.8 times of last year. This is equivalent to 1352 MW of avoided generation capacity in 2016, which is 178% higher than last year avoided generation capacity i.e. 486 MW.

·           Participating units have collectively achieved an annual monetary savings of Rs 4867 crores whereas last year annual monetary savings was Rs 2928 crores.

·           Two new categories i.e. Metro Railways and Metro Stations were included.

·           3 top rank award, 43 First prize, 48 second prize and 62 units were selected for certificate of merit.

 

·           Painting Competition on Energy Conservation for School Children: The habit of conservation is best introduced and inculcated at the school age. It has been seen that the Children are the best agents of change and in this case we need to equip them with the information and knowledge on energy conservation and create interest among them on this important subject. In this regard, Ministry of Power has taken an initiative and has been organizing Painting competition on Energy Conservation for students since the year 2005. The competition is held in three stages, namely, School, State and National Level since 2005. In order to strengthen the campaign, higher classes of 7th, 8th and 9th standards are also being included from this year onward in addition to existing classes of 4th, 5th and 6th Standards. Students of 4th, 5th & 6th standard students under Category ‘A’ and for 7th, 8th & 9th standard students under Category ‘B’ are eligible to participate in the competition. The National Painting Competition on Energy Conservation 2016 was a resounding success. In 2016, a record number of 1.14 crores students participated in the School level Painting Competition as against 1.05 crore students in 2015.  This participation is organized all over the country in association with Bureau of Energy Efficiency and 11 CPSUs under Ministry of Power. The paintings drawn by children reflected their interest in the energy conservation activities and their concern about energy crises and climate change, and have effectively conveyed inspiring ideas in their impressing paintings.