page 1 of 16 national mission for enhanced energy efficiency- pat mechanism presentation by saurabh...
TRANSCRIPT
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National Mission for Enhanced Energy Efficiency- PAT
Mechanism
Presentation by
Saurabh Kumar
Secretary, BEE
World Bank Workshop: Mitigation Actions and Role of Market Instruments
Seoul, March, 2010
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NMEEE – Four New Initiatives
Para 4.2 of the National Action Plan on Climate Change mandates: A market based mechanism to enhance cost effectiveness of
improvements in energy efficiency in energy-intensive large industries and facilities, through certification of energy savings that could be traded. (Perform Achieve and Trade)
Accelerating the shift to energy efficient appliances in designated sectors through innovative measures to make the products more affordable. (Market Transformation for Energy Efficiency)
Creation of mechanisms that would help finance demand side management programmes in all sectors by capturing future energy savings. (Energy Efficiency Financing Platform)
Developing fiscal instruments to promote energy efficiency (Framework for Energy Efficient Economic Development)
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Mission Goals
Market-based approaches to unlock energy efficiency opportunities, estimated to be about Rs. 74,000 crores
By 2014-15:• Annual fuel savings in excess of 23 million toe
• Cumulative avoided electricity capacity addition of 19,000 MW
• CO2 emission mitigation of 98 million tons per year
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Legal Mandate of Central Government under Energy Conservation Act, 2001
Power to notify Designated Consumers (DCs) from energy intensive sectors
Power to prescribe specific energy consumption targets Monitoring and Verification by Accredited Energy
Auditors Mandatory reporting to BEE by DCs Compliance by purchase of Certificates Penalty for non-compliance – linked to level of non-
compliance
*Amendment to EC Act.
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Perform, Achieve & Trade (PAT) Mechanism
Specific Energy Consumption (SEC) reduction targets for the 714 energy-intensive units which are designated consumers under the Energy Conservation Act• Targets would be percentage reduction of current SEC• Percentage reduction requirement based on:
- Current SEC as a ratio of the best in the sector- Mix of fuels used
• Target setting for the power generation and fertilizer sectors through the existing tariff-setting processes
• SEC measurement and verification by BEE through accredited auditors
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Large bandwidth in specific energy consumption in all sectors In almost every sector, the most energy-efficient unit is also amongst the most efficient units in the world
0
2
4
6
8
10
12
14
16
550-600 600-650 650-700 700-750 750-800 800-850 850-900 900-950
Thermal Specific Energy consumption, Kcal/kg-clinker
Nu
mb
er o
f U
nit
s
2005-06
0
1
2
3
4
5
6
3.0 - 5.5 5.5 - 8.0 8.0 - 10.5
GCal/ton of paperN
o.
of
Ind
ust
ries
PAT – Huge Diversity in Specific Energy Consumption within sectors
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Not feasible to define a single norm/standard unless there is significant homogeneity amongst units in a sector
Energy efficiency improvement targets would have to be almost “unit specific”
Bands of differential targets to be created within sectors
Each DC mandated to reduce its SEC by a fixed percentage, based on its current SEC within the sectoral bandwidth
PAT - Setting Energy Consumption Norms
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PAT – Policy Objective
T T+3xT+2xT+x
60
80
100
120
Target Region
kWh/T
BP
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PAT – Current status
714 units in 9 energy intensive sectors notified as Designated Consumers under EC Act. They sectors are: Aluminum, Cement, Iron & Steel, Chlor Alkali, Thermal Power Plants, Fertilizer, Pulp & Paper, Textiles and Railways.
Trading protocols, target setting, regulatory framework, etc to be ready by December, 2010.
Application of PAT w.e.f 1.4.2011 – first commitment period of 3 years
