Mathur Ritika Passi

The Indian government has launched
several initiatives that aim to provide incentives
for the development and adoption of
renewable energy. These include incentives
and subsidies for wind production and solar
production (since 2008), and subsidies for
rural electrification under the Deen Dayal
Upadhyaya Gram Jyoti Yojana (a scheme to
provide continuous power supply to rural
India), introduced in December 2014. The
Union budget of 2015 also doubled the cess
on coal from just under $2 to just over $3
(INR 100 to INR 200) per tonne. Funds
collected from the coal cess will be used to
finance clean energy initiatives under the
National Clean Energy Fund. The SDG
target of substantially increasing the share
of renewable energy in the energy mix is
therefore already underway in India and is
a major priority of the Indian government.
Target 7.3
The SDG target for energy efficiency is to
be tracked through the rate of improvements
in energy intensity, i.e., the amount
of energy consumed to produce one unit of
GDP. Increasing efficiency of energy use is
a policy priority of the Indian government,
and Prime Minister Modi has acknowledged
the economical effectiveness of power
conservation strategies and the need to
generate awareness among citizens for the
same. 22
In 2001, the Energy Conservation Act was
passed with the aim of reducing the energy
intensity of the Indian economy. 23 The
act set up the Bureau of Energy Efficiency
(BEE) to implement and promote energy
efficiency standards in all sectors of the
economy. The bureau has initiated a number
of measures in the areas of household
lighting, commercial buildings, demand-side
management in industry and agriculture,
and in creating standards and labels for
appliances. 24 During the 11th plan period
(2007-2012), these measures resulted in an
avoided capacity generation of 10.8 GW,
highlighting the considerable potential of
energy efficiency measures for reducing
energy demand in the Indian economy. 25
The National Mission on Enhanced Energy
Efficiency is one of the eight national
missions of the National Action Plan on
Climate Change and consists of four initiatives:
• Perform, Achieve and Trade (PAT)
Scheme—market-based mechanism
designed to support improvements in
energy efficiency in large industries and
facilities through the certification of
energy savings, which can be traded;
• Market Transformation for Energy
Efficiency (MTEE)—creation of innovative
policy measures to accelerate
the shift to energy-efficient appliances
in selected sectors;
• Energy Efficiency Financing Platform
(EEFP)—enable mainstream financing
of energy efficiency projects through
learning and sharing of experiences on
removing barriers to access of finance;
• Framework for Energy Efficient
Economic Development (FEEED)—
development of fiscal instruments to
promote energy efficiency. 26
The Energy Conservation (EC) Act, 2001,
also identified 15 large energy-intensive
industries for energy efficiency improvements
in India. These energy-intensive industries
are named as Designated Consumers in the
EC Act and account for 25% of the national
GDP and about 45% of commercial energy
use in India. 27 Out of the 15 Designated Consumers,
eight industries are covered under the
PAT Scheme. PAT was launched in July 2012
by the BEE and covers 478 industrial units
across the aforementioned eight industries,
which together accounted for 40% of India’s
primary energy consumption at the time. 28
The scheme set a target to save 6.68 million
tonnes of oil equivalents by March 2015. 29
In January 2015, the Director General of
BEE confirmed that 90% of companies are
on track to meet their targets due to investments
in new technologies. This, he said,
has resulted in about $5 billion saved in oil
imports, based on average Brent crude prices
over the three-year period, and electricity
savings equivalent to the output of five coalfired
power plants. 30
In fact, the energy intensity of the Indian
economy has declined by 30% between
2000 and 2011, about half due to energy
efficiency improvements as per the BEE. 31
Energy efficiency has great potential for reducing
the country’s energy demand and its
dependence on oil imports, thereby helping
reduce its carbon footprint, as demonstrated
by the success of the PAT scheme and the
surpassing of targets in the Eleventh Five
Year Plan. 32
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