Negawatt better than Megawatt? – Energy Efficiency scores big..

While Solar energy has been hogging the limelight since the start of the Jawaharlal Nehru National Solar Mission(JNNSM) in 2010, it’s unglamorous cousin National Mission for Enhanced Energy Efficiency(NMEEE), which was also started in 2010, has been marching ahead with some great results.

The Bureau of Energy Efficiency(BEE) has announced that during the first PAT(Perform, Achieve,Trade) cycle(2012-15), a total of 5,635 MW in power generation was avoided as a result of the Energy Efficiency measures taken by the Designated Entities(DC) under PAT. So that is more than 5.6 Negawatts deployed during the first PAT cycle(A negawatt is a negative megawatt: a megawatt of power saved by increasing efficiency or reducing consumption).

Some of the other highlights of the success of this PAT cycle are

  •  Energy saving of 8.67 million tonne of oil equivalent (Mtoe) against the targeted energy saving of 6.886 Mtoe
  • Emission reduction of 31 million tonnes of CO2
  • Monetary savings of Rs. 37,685 crore.
  • Investment of Rs. 24,517 crore for energy efficient Technologies

Designated Entities

The first PAT cycle (2012-15) covering 478 Designated Consumers (DCs) from 8 energy-intensive sectors, namely Aluminium, Cement, Chlor-alkali, Fertilizer, Iron and Steel, Pulp and Paper, Textiles and Thermal power plant which roughly covered 33% of India’s total energy consumption.

In the second cycle, 621 DCs from 11 sectors have been included in the scheme.

Energy Savings Certificates – ESCerts

Energy Savings Certificates(ESCerts) are the Energy Efficiency equivalent of Renewable Energy Certificates(RECs). While RECs have been traded in the market since 2012, trading of ESCerts will start only from the current financial year. Unlike generation of electricity which can be easily measured making it easy to verify the generation for issuance of RECs, Measurement and Verification(M&V) of energy savings is a longer term process.

According to BEE, “the first cycle of PAT was completed in March 2015, and upon verification of the performance of DCs with regard to energy savings, based on recommendations of BEE, Ministry of Power has issued/entitled to purchase Energy Savings Certificates (ESCerts) to DCs of PAT Cycle I on 16th February 2017”

The players involved in the ESCerts trading are as follows

  • Central Electricity Regulatory Commission(CERC) – Market Regulator
  • Bureau of Energy Efficiency – Administrator for the trading of ESCerts
  • POSOCO (Power System Operation Corporation limited) – Registry for making DCs as eligible entities for trading of ESCerts and book-keeping of ESCerts
  • IEX and PXIL – Power exchanges where trading of ESCerts shall take place.

Following the extraordinary success of the first cycle of PAT, we believe that Energy Efficiency is poised to take of in a big way in India. With the ESCO(Energy Savings Company) model getting prominence(especially the PSU ESCO – EESL), investments in Energy Efficiency will see a huge leap.

We are at the doorsteps of Energy Efficiency 2.0. (more details on EE 2.0 available here).

PS

More details about the BEE announcement can be accessed here.

More details about the PAT scheme can be downloaded here.

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