Overview of the Indian policies to promote industrial energy

efficiency and possibilities for shared learning

K. K. Chakarvarti,

Expert Consultant,

New Delhi

Roundtable Discussion

28th September,2016

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Contents

Legislative and Institutional Framework on

Energy Efficiency in India

EE Initiatives in Industry

National Mission for Enhanced Energy

Efficiency (NMEEE)

Voluntary Initiatives to promote Energy

Efficiency

Conclusions

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Legislative and Institutional

Framework

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Energy Efficiency in India

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EC Act enacted in October 2001

The five major provisions of EC Act relate to:

Designated Consumers

Standards and Labeling

Energy Conservation Building Code

Creation of Institutional Set up (Bureau of Energy

Efficiency at the Federal level)

Establishment of Energy Conservation Fund at

Centre and States Schedule to EC Act provides list of 15 energy intensive industries and other establishments to be notified as designated consumers (DC). A DC to

Comply with energy consumption norms and standards

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THE INDIAN ENERGY CONSERVATION ACT

Energy Efficiency Initiatives

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Industry

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DCs - Energy Manager Certification

11 energy intensive industry have been notified as

designated consumers (DCs)

The Government of India has specified the passing

of the National level certification examination as the

qualification for Certified Energy Manager and

energy auditors to be appointed by industry.

17 certification examinations have been conducted

since 2004 in 24 main cities (12,228 qualified

certified Energy Managers out of which 8,536 are

certified Energy Auditors from last 15 exams)

National Mission for

Enhanced Energy Efficiency (NMEEE)

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Mission was approved by Indian Cabinet

on 24th June, 2010 with an 11th Plan outlay

of Rs.2350 Million (US $ 39 Million).

Indian Cabinet has approved continuation

of the Mission for 12th Plan on 6th Aug., 2014

with an outlay of Rs.7750 Million (US $ 129

Million).

National Mission for Enhanced Energy Efficiency (NMEEE)

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Perform Achieve and Trade

scheme

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Regulatory instrument linked with market mechanism

Certification of energy saving

Consultative approach

Ministries/DCs/Associations/FIs/Research Organizations

Outreach/ Capacity Development

Workshops/Seminars/ Visits

“Self – competing”

Unit specific targets

Relative responsibility

Less target for more efficient and more for less efficient

Supports improvement in energy management system

measurement, recording and reporting

PAT- Salient features

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PAT Overview and

Elements

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• PAT Cycle – I Covers 478 plants in 8 energy intensive industrial sectors

• PAT Cycle-II, covers 621 plants in 11 energy intensive industrial sectors

(three new sector, Refinery, DISCOMS and Railway has been added, with

addition of new DCs in existing as well)

• Key Goal :Mandatory Specific Energy Consumption reduction

PAT Overview and Elements

PAT Cycle-1

S.NO. Sector No. of

Identified DCs

Annual Energy

Consumption (Million

toe)

Share Consumpti

on (%)

Apportioned Energy

Reduction For PAT Cycle-1

(Million toe)

1 Power (Thermal) 144 104.56 63.38% 3.211

2 Iron & Steel 67 25.32 15.35% 1.486

3 Cement 85 15.01 9.10% 0.815

4 Aluminium 10 7.71 4.67% 0.456

5 Fertilizer 29 8.20 4.97% 0.478

6 Paper & Pulp 31 2.09 1.27% 0.119

7 Textile 90 1.20 0.73% 0.066

8 Chlor- Alkali 22 0.88 0.53% 0.054

Total 478 164.97 100.00% 6.686

Total EE Projects planned in 2012-15: 2057

Total anticipated investment : US$ 3095 million

The direct benefit for the participating industries in this period is reductions

in input costs related to energy of approximately US$ 1250 million.

Sectoral Share in Energy Saving Target (%)

(2012-15)

Reduction in India's CO2

emissions by 24 million tons /

year in 2014-15.

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Cement Sector: Baseline and Targets - An Example

Energy Transition for Industry: India and the Global Context, IEA, Jan 2011

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Although Indian Cement Sector being at par with the World

best energy intensity, but still has agreed for energy saving

targets of 0.85 million ton of oil equivalent energy under PAT

Japan

India

ENERGY SAVINGS CERTIFICATES (ESCerts)

The energy savings certificate shall be issued in electronic form.

The value of one energy savings certificates shall be equal to one

metric ton of oil equivalent of energy consumed.

The designated consumer who has been issued energy savings

certificates may sell them through the power exchange. Each

certificate will be unique tradable commodity which will be

traded in two exchanges

The designated consumer who has been issued the energy

savings certificates during the current cycle may use them for the

purpose of banking until the next compliance cycle after which

they stand expired.

PAT-I : CEMENT SECTOR-SUMMARY (DRAFT) PAT-1 : ACHIEVEMENTS- CEMENT SECTOR (DRAFT) ( Tentative Data, subject to change )

Notified Units Energy Consumption in Base Year (2009-10) MTOE

Target Savings to be achieved in 2014-15 (MTOE)

Achievements Made (MTOE) -DRAFT

Percentage Over achievement

85 15.01 0.815 1.480 81.6

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Specific Energy Consumption Reduction - 8.5% (Un-normalised)

Specific Energy Consumption Reduction - 11% (Normalised)

Total investment - Rs. 25480 Millions

( 280 Million GBP)

Waste Heat Recovery power Project implementation

- 11 nos. (159 MW)

ESCerts for Individual Sector ( PAT-I)

Sector

Target Achieved ESCERTS to be issued in

Nos No of DC Saving in

Million TOE No of DC Saving In

Million TOE

Aluminum 10 0.486 10 0.73 244000

Cement 85 0.815 74 1.44 625000

Chlor- Alkali 22 0.054 22 0.10 46000

Fertilizer 29 0.478 29 0.83 352000

Iron & Steel 67 1.486 60 2.10 614000

Paper & Pulp 31 0.119 26 0.26 141000

Textile 90 0.066 82 0.12 54000

Thermal Power Plant

144 3.211 123 3.06

Total 478 6.685 427 8.64 2076000

Introduction to PAT-II ( 2016-17 to 2018-19)

Ministry of Power Notification on 31st march 2016 - PAT cycle-II- Target for DC’s notified.

3 more Sectors included in PAT cycle -2 namely:

- Petroleum Refinery.

- Railway – Zonal Railways – Production – Workshops.

- Electricity Distribution Companies (DISCOMs).

Sr.

No

Sector No. of DCs in

PAT I

Total no. of

DCs PAT -2

1 Aluminium 10 12

2 Chlor-Alkali 22 24

3 Textile 90 99

4 Pulp & Paper 31 29

5 Iron & Steel 67 71

6 Fertilizer 29 37

7 Cement 85 111

8 Thermal Power

Plants

144 154

9 Refinery NA 18

10 DISCOMS NA 44

11 Railway NA 22

Total 487 621

PAT Cycle II Baseline Year: 2014-15 PAT Cycle year 2016-2019 Assessment Year: 2018-19 M&V period: Apr-2019 to 31st July2019

Total Energy Consumption from 11 sectors 227 mtoe

National Target = 8.869 mtoe at the end of 2nd PAT Cycle (by 2018-19)

PAT-II Overview and Status

Normalisation Factors- Broad Categorization

Plant Capacity Utilisation Natural Disaster & Unforeseen Circumstances

Product Mix Intermediary products

Power Mix

Fuel Mix

CPP PLF

Fuel Quality in CPP

Environmental Concern

Market Transformation due to PAT

–Common Areas of Investment

Energy Efficient Technologies and Processes

Power, Steel, Cement, Fertiliser, Pulp & Paper, Aluminium, Chlor Alkali, Textile

Waste Heat Recovery/ Co Generation

Steel, Cement, Pulp & Paper, Aluminium, Chlor Alkali, Textile

Alternate Fuel and Raw Material Steel, Cement, Pulp & Paper, Aluminium, Chlor Alkali, Textile

Renewable Energy

Steel, Cement, Pulp & Paper, Aluminium, Chlor Alkali, Textile

Biomass as Fuel

Steel, Cement, Pulp & Paper, Aluminium, Chlor Alkali, Textile

High Pressure Boiler for Optimum power output Pulp & Paper, Aluminium, Textile

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For Designated Consumers

Improvement in Energy Intensity will bring down the

specific input energy cost and ultimately triggers

higher profit in company’s balance sheet

The DCs can trade over achieved Energy efficiency

in the trading platform to the under achiever

Capacity building of Man power

For Technology Suppliers

Business opportunities in terms of lower payback

period of energy efficient technologies.

For Service Company’s

Opportunities in terms of Energy Auditing, capacity

buildings, Implementation of projects as ESCO model

All win situation

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Voluntary Initiatives to

promote Energy Efficiency

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ISO 50001 Energy Management System

More than 300 industrial units have declared their energy management policy .

PAT mechanism has all factors which are part of EnMS

Around 270 establishments including buildings and industry in India have been certified for ISO 50001 EnMS

The Delhi International Airport Limited (DIAL) became the first airport operator and Dahanu Thermal Power Station, Maharashtra (India) became the first Thermal Power Station in the world to receive this certification after its publication in mid 2011.

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Knowledge Exchange Platform-

A voluntary initiative to promote energy efficiency in Indian Industry

KEP was established in India on 26th Feb.,2015

to provide a vibrant platform, anchored at BEE, to

support PAT industry through promotion of

knowledge transfer on best practices, information

exchange on innovative technologies, Energy

Management System, facilitate policy discussion

forums and friendly energy efficiency exchange

visits.

MoU signed between Bureau of Energy Efficiency (BEE)

and Institute for Industrial Productivity (IIP)

KEP Action plan and News Letter released by Secretary,

Ministry of Power

KNOWLEDGE EXCHANGE PLATFORM (KEP)

KEP LAUNCH (26th February,2015)

Participants at the Best Practice Workshops and Roundtable organised by KEP

Conclusions A Scheme to incentivize the industry to achieve

better energy efficiency

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CONCLUSIONS

The PAT scheme is a unique and innovative programme with no

precedence anywhere else in the world.

PAT would become a valuable model for other emerging

economies to adopt for their own energy efficiency programmes

with a business perspective.

The PAT scheme also sets an innovative approach of introducing

market-based instruments within a regulatory framework to

encourage compliance.

PAT has encouraged adoption of energy efficient and Low carbon

technology, use of renewable , waste heat recovery and use of

Alternate fuel and raw materials (AFR) in Indian industry.

Knowledge Exchange Platform has now established its name in

India and supporting PAT industry through promotion of

knowledge transfer on best practices, information exchange on

innovative technologies, Energy Management System, facilitating

policy discussion forums and friendly energy efficiency exchange

visits.

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FIR

ST P

RIZ

E

US$

20

00

K R Roshni, Standard V, Tamil Nadu (India)

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First Prize Winning Painting-

Visit us at www.knowledgeplatform.in

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