Energy Conservation Act & BEE- An Overview

By

Jitendra Sood Energy Economist

Bureau of Energy EfficiencyGovernment of India

India has an installed power generating capacity of 146,752.81MW (as

On November 30, 2008) of which the thermal power stations share is

92,892.64 MW (64%).

IntroductionIntroduction

Ins talled P ower Generating C apac ity(IND IA)-F uel T ype Wis e

(MW)13242.414120

36,497.76

92,892.64

THE RMAL

HY DRO

NUC LE AR

RE S

51.81%33.03%

15.16%

Total Installed Capacity: 1,46,753 MW(As on 30th November 2008)

STATE

CENTRAL

PRIVATE

India’s Energy Intensity is fifth lowest in the world

ØJapan, Denmark, UK and Brazil have lower energy intensityØEnergy intensity is declining at about 1.5% per year

Energy consumption in India is low, though efficiency of use is reasonable Per capita energy consumption is 530 kgoe; world average is 1770 Energy intensity of Indian economy was 0.18 kgoe/$-GDP(PPP) in

2004; compared to 0.14 in Japan and 0.19 in the EU

Energy demand is increasing due to rising incomes, accelerated industrialization, urbanization and population growth 2003-04 : 572 Mtoe 2016-17 : 842-916 Mtoe 2026-27 : 1406-1561 Mtoe

Meeting the increasing demand only through increases in supply may lead to: Reduced energy security due to volatility in availability and prices

of imported fuels Adverse environmental impacts Strain on balance of payments

Energy conservation and energy-efficiency are an essential part of national energy strategy

Energy Use in India

6

FEATURES OF FEATURES OF INDIAN ENERGY CONSERVATION INDIAN ENERGY CONSERVATION

ACTACT

Enacted in October 2001Enacted in October 2001

Become effective from 1st March 2002 , and implemented in Become effective from 1st March 2002 , and implemented in 2006. 2006.

Bureau of Energy Efficiency (BEE) operationalized from 1Bureau of Energy Efficiency (BEE) operationalized from 1stst March 2002. March 2002.

MISSION OF BEEMISSION OF BEE Develop policy and strategies with a thrust on self regulation and Develop policy and strategies with a thrust on self regulation and

market principles, within the overall framework of the EC Act market principles, within the overall framework of the EC Act with the primary objective of reducing energy intensity of the with the primary objective of reducing energy intensity of the Indian economy.Indian economy.

Thrust Areas

1. Energy Efficiency (EE) in the industrial sector.2. Demand Side Management in the power sector.3. Standards and Labeling for appliances and equipment.4. Energy Efficiency in buildings and establishments.5. Energy Conservation Building Codes (ECBC).6. Professional Certification and Accreditation.7. Manuals and Codes.8. Energy Efficiency Policy Research.9. Energy Conservation Awareness in schools.10. Delivery Mechanisms for EE services.

DESIGNATED CONSUMERSDESIGNATED CONSUMERS( Energy Intensive Industries and other Establishments)( Energy Intensive Industries and other Establishments)

(A programme to initially focus on energy policy issues of energy efficiency (A programme to initially focus on energy policy issues of energy efficiency improvement in organized sectors such as energy intensive industries and improvement in organized sectors such as energy intensive industries and commercial sector through establishment of energy management system, commercial sector through establishment of energy management system, capacity building of energy professionals, implementation of energy audits, capacity building of energy professionals, implementation of energy audits, establishments of specific energy consumption norms and support to establishments of specific energy consumption norms and support to consumers on providing information on authentic energy data ) consumers on providing information on authentic energy data )

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

Appoint or designate energy managersAppoint or designate energy managersGet energy audits conducted by accredited energy auditorsGet energy audits conducted by accredited energy auditorsImplement techno-economic viable recommendationsImplement techno-economic viable recommendationsComply with norms of specific energy consumption fixed Comply with norms of specific energy consumption fixed Submit report on steps takenSubmit report on steps taken

Out of 15 energy intensive industries 9 has been identified as Designated Out of 15 energy intensive industries 9 has been identified as Designated Consumers.Consumers.

DESIGNATED CONSUMERS

8.Textiles

2.Fertilizers

5.Chlor Alkali 6.Aluminium

9.Pulp & Paper7.Railways

3.Cement1.Textiles

4.Iron & Steel

1)

Criteria for Notification for a Industry as Designated Consumer

Thermal Power Stations- 30,000 metric tonne of oil equivalent (MTOE) per year and above

2) Fertilizer- 30,000 metric tonne of oil equivalent (MTOE) per year and above

3) Cement- 30,000 metric tonne of oil equivalent (MTOE) per year and above

4) Iron & Steel- 30,000 metric tonne of oil equivalent (MTOE) per year and above

5) Chlor-Alkali- 12,000metric tonne of oil equivalent (MTOE) per year and above

6) Aluminium- 7,500 metric tonne of oil equivalent (MTOE) per year and above

7)Railways- One traction substation in each Zonal Railway , Production units and Workshops of Indian Railways having total annual energy consumption of 30,000 MTOE or more under Ministry of Railways

8) Textile-3,000 metric tonne of oil equivalent (MTOE) per year and above

9) Pulp & Paper-30,000 metric tonne of oil equivalent (MTOE) per year and above

To strengthen the energy management and energy auditing To strengthen the energy management and energy auditing capabilities in the country, 7 National Certification capabilities in the country, 7 National Certification examinations for Energy Managers and Energy Auditors have examinations for Energy Managers and Energy Auditors have been successfully conducted in 2004, 2005, 2006, 2007 & May been successfully conducted in 2004, 2005, 2006, 2007 & May and Nov 2008 respectively in 28 centers all over the country.and Nov 2008 respectively in 28 centers all over the country.

61 energy auditing agencies have been accredited on the bases 61 energy auditing agencies have been accredited on the bases of their energy auditing capabilities and institutional set up.of their energy auditing capabilities and institutional set up.

Accredited Energy Auditors have carried out about 3000 Accredited Energy Auditors have carried out about 3000 energy audits on voluntary basis in the last 3 financial years energy audits on voluntary basis in the last 3 financial years (2003-06).(2003-06).

Energy saving to the tune of 2041Million kWh, 750960 Tons of Energy saving to the tune of 2041Million kWh, 750960 Tons of Coal, beside savings in oil and gas, equivalent to Rs.6488 Coal, beside savings in oil and gas, equivalent to Rs.6488 Million have been recommended by 21 such agencies during Million have been recommended by 21 such agencies during the past 3 years.the past 3 years.

Designated ConsumersDesignated Consumers –(contd.)

Manuals and Codes Manuals and codes on 7 Technologies (Equipment) Lighting Manuals and codes on 7 Technologies (Equipment) Lighting

Systems; Dryers; Cogeneration Plants; Electric Motors; Electric Systems; Dryers; Cogeneration Plants; Electric Motors; Electric Transformers; Fluid piping systems (network), insulation and Air Transformers; Fluid piping systems (network), insulation and Air Conditioners/Chillers (HVAC) have been prepared. Conditioners/Chillers (HVAC) have been prepared.

The manuals and code would help in standardizing the process The manuals and code would help in standardizing the process of energy audit to support energy manager and energy auditorsof energy audit to support energy manager and energy auditors

Designated ConsumersDesignated Consumers –(contd.)

BEE Codes & Manuals

15

Standards and Labeling of Standards and Labeling of AppliancesAppliances

(A programme initially to focus on energy policy issues of energy (A programme initially to focus on energy policy issues of energy efficiency improvement in unorganized sectors such as domestic and efficiency improvement in unorganized sectors such as domestic and agriculture sectors through improvement of designed energy efficiencies agriculture sectors through improvement of designed energy efficiencies of energy consuming appliances and providing this information on of energy consuming appliances and providing this information on comparative basis in the form of energy labels)comparative basis in the form of energy labels)

Evolve minimum energy performance standards (MEPS) for notified equipment and appliances

Prohibit manufacture, sale and import of equipment and appliances not confirming to MEPS

Introduce Energy labeling to enable consumers to make informed choice The National Energy Labeling Programme has been launched by Union

Minister of Power on 18th May, 2006– House-hold refrigerators, fluorescent tube lights (4 feet), general

purpose electric motors and air conditioners have been included in the programme on voluntary basis; 70% of refrigerator production, 90% of tube light production; and 40% of AC production is now covered by the programme.

– Other appliances/equipment, such as, LPG burners and ceiling fans are also planned to be launched.

Products for Energy-Efficiency Labels

16

Frost Free (No-Frost) Refrigerator

Tubular Fluorescent Lamps

Room Air Conditioners

Direct Cool Refrigerator

Distribution Transformer

Induction Motors

Pumps Sets

Ceiling Fans

LPG

Electric Geysers

Color TV

Future - Equipments / appliances for S&L

17

Water HeatersWashing MachinesElectronic Ballast Computer Monitors Kerosene StovesConsumer Electronics

Uninterrupted Power Supply (UPS)External Power Supplies (EPS) Battery Chargers (BCs)

Agricultural pump setsIndustrial Fans & Blowers Industrial Fans & Blowers

Home Appliances

Motor systems

18

Sample LabelsSample Labels

Ref

riger

ator

Ref

riger

ator

19

Appliance CO2 Reduction as an impact of Star labeling

AC 0.106476 Million Tons

Refrigerator 0.946334 Million Tons

TFL 0.146880 Million Tons

TOTAL 1.1996690 Million Tons

Impact of S&L on Environment

22

ENERGY CONSERVATION BUILDING CODEENERGY CONSERVATION BUILDING CODE ECBC covering five climatic

zones of India (Hot & Dry, Warm & Humid, Composite, Temperate and Cold) prepared

ECBC set minimum energy efficiency standards for design and construction

Mandatory Scope Covers commercial buildings Connected load in excess of

500 kW or Contract demand in excess of

600 kVA Applies to New Construction

only

23

Energy Conservation Building Energy Conservation Building Code ( contd.)Code ( contd.)

ECBC covers the following components of a building:– Building Envelope (Walls, Roofs, Windows)– Lighting (Indoor and Outdoor)– Heating Ventilation and Air Conditioning (HVAC) System– Solar Hot Water Heating– Electrical Systems

Minister of Power launched ECBC on voluntary basis on 27 th May, 2007; mandatory after capacity building and implementation experience

Impact of ECBC - Reduced Energy use for buildings – National Benchmark ~ 180 kWh/m2/year – ECBC Compliant building ~ 110 kWh/m2/year

Bachat Lamp Yojana• Bachat Lamp Yojna a CDM based scheme was launched on 28 th May, 2008.

• Scheme seeks to replace estimated 400 million incandescent bulbs by CFLs which could save estimated 6000 MW by 2012

• BEE is in the process of preparing a Programme of Activities (PoA) which is a voluntary coordinated effort to facilitate the scheme in the entire country and reduce transaction costs of individual projects

• 18 CFL manufacturers/ suppliers have agreed to participate- 14 states have taken up steps towards implemetation of scheme in their respective DISCOM regions.

• Monitoring Plan has been finalised

• 1 pilot project registered at UNFCCC on 26 th Sept 2008. PDDs for Haryana , Andhra Pradesh, Maharashtra have been submitted to CDM Executive Board for registration.

• Leveraging of CDM revenues to remove the high first cost barrier to enable market transformation in favour of efficient lighting.

Demand Side Management (DSM) to

Reduce Risk• Bachat Lamp Yojana (Lamp Savings

Programme)• Energy efficiency upgrades in existing

buildings• Agriculture DSM & Municipal DSM

Union Power Minister Shri Sushil Kumar Shinde launched ECBC on voluntary basis on 27th May, 2007

ENERGY SERVICES COMPANIES(ESCOS)

• The Bureau of Energy Efficiency has also taken necessary steps to encourage the supply of performance-contract based energy-efficiency enhancement services through Energy Service Companies (ESCOs).

• An exercise for expanding the number of existing ESCOs

through an open invitation and evaluation process was taken up by BEE, whereby 37 ESCOs were found eligible for short listing.

• An accreditation exercise of ESCOs, in terms of success in implementation of energy efficiency projects, ability of technical man-power, and financial strength to invest in such projects, was carried out by CRISIL and ICRA, with technical and financial support of BEE.

Launch of Report on “Situation Analysis of Commercial Buildings in India” on 24 November

2008 at New Delhi

Launch of Report on “Accredited ESCOS” on 24 November 2008 at New Delhi

Eight National Misssions National Solar Mission. National Mission for Enhanced Energy

Efficiency. National Mission on Sustainable Habitat National Water Mission National Mission for Sustaining the

Himalayan Ecosystem National Mission for a Green India National Mission for sustainable agriculture National Mission for Strategic Knowledge for

climate Change

National Mission for Enhanced Energy Efficiency.

Market Transformation for Energy Efficiency (MTEE)

Energy Efficiency Financing Platform (EEFP) Framework for Energy Efficient Economic

Development (FEEED) Capacity building for Banks and Financial

Institutions Institutional Arrangements

Market Transformation for Energy Efficiency(MTEE)1. BEE has undertaken PoA (program of activities) for efficient lighting in

domestic sector (Bachat Lamp Yojna), Municipal DSM, Agriculture DSM,SME sector, Commercial sector and Distribution Transformers.

2. CDM Potential in Power and Energy Efficiency Sector. Renovation/Retrofit, Replacement, Green-Field, Fuel Switch, Captive generation.

3. Removal of Barriers to CDM in India Promote cleaner technologies by leveraging CDM • Removal of implemetation barriers for renewables.• Regulatory incentives to promote cleaner technologies use in the

country.• Promotion of Cogeneration,Supercritical boilers in UMPPs.• Promotion of public transport and fuel efficiency in the transport

sector.• DSM initiatives in various sectors like industry, agriculture, SMEs,

Municipalities, buildings, etc.

Energy Efficiency Financing Platform(EEFP)1. Overall energy efficiency investment market size under ESCO system

of performance contract in India has been estimated by the ADB at Rs 140 bn (Rs.14000 crores).

2. Demonstration Projects in Government buildings• Covering the entire project cycle from audit to performance

measurement and verification• Design of standard performance contract.• Design of Financial mechanism for project funding.• Project Implementation and post evaluation of impact.• Capacity building among ESCOs and project owners.

3. Removal of Financing Barrier for ESCOs

4. Promotion of ESCOs through government programs in Commercial. Municipal, Agriculture and Small and Medium Enterprises sectors. Accrediation of ESCOs through rating agencies like CRISIL and ICRA

Framework for Energy Efficient Economic Development(FEEED)

1.Partial Risk Guarantee Fund (PRGF)

2.Venture Capital Fund for Energy Efficiency (VCFEE)

3. Incentives to Central Public Sector Undertaking (CPSUs) to take up energy efficiency.

4.Energy Efficient Public Procurement

5.Tax/Duty Exemptions for Promotion of Energy Efficiency.

National Energy Conservation AwardsNational Energy Conservation Awards

BEE coordinates this voluntary activity on behalf of Ministry of Power

Due to consistent efforts put in by BEE, scheme has become very popular among industries, as is evident from increasing participation level

The President, Smt. Pratibha Devisingh Patil presenting the National Energy Conservation Awards-2007 at the National Energy Conservation Day function, in New Delhi on December 14, 2007. The Union Power Minister, Shri Sushil Kumar Shinde is also seen.

Encouraging response from Indian Industry in the Energy Conservation Award Scheme

(1999-2008)

123 120157 174

191

297343

388 384 368

0

50

100

150

200

250

300

350

400

No. o

f par

ticip

atin

g in

dust

rial u

nits

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Year

Electrical Energy Saving in terms of Equivalent Avoided Capacity in MW

45

10090

122 103

155

252 245

308325

0

50

100

150

200

250

300

350

Equi

vale

nt a

void

ed c

apac

ity in

MW

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Year

CONCLUSIONSCONCLUSIONS The increasing preference for commercial energy has led to a The increasing preference for commercial energy has led to a

sharp increase in the demand for electricity and fossil fuels.sharp increase in the demand for electricity and fossil fuels. Use of Fossil Fuels result in emission of huge quantity of Use of Fossil Fuels result in emission of huge quantity of

carbon dioxide causing serious environmental damages.carbon dioxide causing serious environmental damages. There is a considerable potential for reducing energy There is a considerable potential for reducing energy

consumption by adopting energy efficiency measures at consumption by adopting energy efficiency measures at various sectors of India.various sectors of India.

Energy efficiency will not only reduce the need to create new Energy efficiency will not only reduce the need to create new capacity requiring high investment, but also result in capacity requiring high investment, but also result in substantial environmental benefitssubstantial environmental benefits..

With the enactment of the Indian Energy Conservation Act, With the enactment of the Indian Energy Conservation Act, 2001, an institutional framework is now available for 2001, an institutional framework is now available for promoting energy efficiency in all sectors of the economypromoting energy efficiency in all sectors of the economy

Efficient use of energy and its conservation is succeeding as Efficient use of energy and its conservation is succeeding as a program as now there is a strong institutional set up in the a program as now there is a strong institutional set up in the country and opinion leaders and captains of industry are country and opinion leaders and captains of industry are taking lead in implementing the best practices supporting the taking lead in implementing the best practices supporting the conservation programmeconservation programme