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Feature | November 2015

Our goal is to add three new sectors to the next PAT cycle

Dr Ajay Mathur, Director General, Bureau of Energy Efficiency (BEE)

How will energy efficiency help meet our demand for power?
Look at the principle of energy efficiency as a leaky bucket. If there is a leak somewhere, no matter how much you fill the bucket, it will not be full. It is the same concept here and today we have the opportunity to reduce energy demand by 10 per cent. This is big, because it means that much less energy is imported and paid for and that much less infrastructure has to be built. This has a very important benefit for every energy consumer, for companies, for the country and obviously for the world, because carbon emissions will not increase at the same rate as they would otherwise.

Is the government?s approach sufficient enough?
Our numbers indicate that energy savings due to government programmes alone is something of the order of 4-5 per cent of the energy consumed in the country?and our goal is to take this to 10 per cent. So, if we consume somewhere ~750 BU/year, 4-5 per cent of it is about 32 BU/year, so that is the amount of savings that we are able to achieve due to programmes.

If you look at appliances that common people use, then clearly, the star labelling programme had a huge impact. 7 years ago the average efficiency of an air conditioner sold was 2.6 Energy Efficiency Ratio (EER) in 2007-08 and of those sold in 2014-15 was 3.14 EER, so you can immediately see that there is over 25 per cent increase, over a 7 year period. Similarly for refrigerators.

What is the status on PAT?
PAT (Perform, Achieve & Trade), was launched for 478 industries who were given a target to reduce the Specific Energy Consumption (SEC). The period within which they had to achieve this ended on March 31, and there have been third party verifications. These reports have been received and are currently being reviewed. So, while the final results are not out, it seems to us as a preliminary estimate that probably the overall savings would be achieved. Some have over performed and some may have not met their target. But, the overall target has probably been achieved. So, I would say that whenever a programme is launched there is a very big impact on the pick-up of these programmes. The results are expected to be out soon and the second cycle is under preparation.

Kindly share your plans for the new cycle post 2014-15.
We are currently talking to all the industries and our goal is to add 3 new sectors--namely power distribution companies, refineries and railways. The target will depend on the performance of the first cycle. The targets for all are currently under discussion, because we also need to develop what the methodology for these sectors will be. So, the discussion on the methodologies, the data that is needed and decisions the targets that have to be fixed, would be competed by the end of this calender year (2015).

How successful have Standards & Labeling, SDA etc. been in this endeavour?
All of these aren?t regulatory, but market based. So, when we do the lighting programmes, municipal DSMR, or agricultural DSM, all of these depend on you and I agreeing to change our inefficient equipment for efficient ones. So, while the Bachat Lamp Yojana is long over, we have now moved on to the LED lightning programme, where our goal is for all households to start using LED bulbs and all streetlights should be changed to LED ones. But, people have not picked this up as LEDs are expensive. Therefore, through our company EESL (Energy Efficiency Services Limited), we have started a programme, wherein, EESL buys the bulbs at its own cost and gives them to you and me through the electricity distribution companies, for a price of about Rs 100, which is then taken at Rs 10 per month from your electricity bill. So, you pay for it in a very comfortable manner.

This way, EESL gets its money back and the discom can avoid expensive power buys at its peak load. This is happening in Mumbai, Delhi right now and has already been completed in many other places like AP, Puducherry, and some districts of Rajasthan. Our goal is to cover the country in 3 years. Similarly, for streetlights, EESL buys the streetlights and put them in municipal streets and the municipality repays them over a period of 5-7 years. This, basically, reduces the total expenditure of the municipalities. Earlier, they were paying the electricity and maintenance bills, now their electricity bill has come down, maintenance is taken care of by EESL and though they still pay, the total is much less than what they used to.

What is BEE?s approach towards initiatives on R&D in energy efficiency?
Unfortunately, there is no BEE programme for R&D as of yet, as all our programmes till now have been focussed on the various classes of consumers. But, R&D is very important so tomorrow, products would need R&D to be developed, so we have also very recently, launched an air conditioning challenge programme.

As I said, the average efficiency of ACs sold today is 3.14 EER, we want to raise this to 6 EER, which is currently not available in India, and if made, would cost approx Rs 80,000--none of us would buy it. So, we want ACs with EERs of 6 at prices that you and I are willing to pay for. So, our experience is that consumers are willing to pay the amount of money they will save over a 3-5 year period, e.g. Rs 15,000 in 3-5 years, but that will still take the price to Rs 40,000-45,000, so then there is a huge price gap. We believe, that on one hand, a good procurement model like EESL has done, would provide manufacturers with the comfort that if they develop a product, there will be a market, and that if they do it at this price, then EESL will even purchase it for their programmes. Which is what premise the AC challenge programme is based on, the goal is to incite manufacturers to invest in R&D. But, we ourselves are not directly doing it.

What are some of the other programmes on energy efficiency that BEE is working on?
There is something else that we are doing on buildings. This is an Indo-US programme, so the way it is structured is that first there is a India-US team, so there are research organisations and companies at the Indian and US sides each. We pay them research grants of upto $1 million per year and the US side also pays their consortia upto $1 million per year. There was an international process through which people submitted applications, there was an Indo-US panel which chose the ones to support. So, this consortia is working on methodologies to have more efficient buildings.

What is your estimate on the potential growth for energy efficiency applications in India?
The thing is that energy costs in India are very high--amongst the highest in the world. So, there is a huge savings to industry if they invest in energy efficiency and they become more competitive. The issue to them is, will this work for me? Most industries are aware that energy efficiency technologies exist which are of interest to them, the challenge is - will this work for me? Will the person take responsibility/liability for it? So, those are the kinds of business models that we seek to create. But, generally speaking we have found that industry has been proactive in investing in energy efficiency. So, we see our role as supporting the industry in their move towards energy efficiency.

Are market conditions and industry sentiments in favour?
Well, there is increasing trend of PSU involvement. Power Trade Corporation has actually created a unit for energy efficiency. This is a commercial company which is implementing energy efficiency in the power sector. Similarly, NTPC has this whole organisation called Centre for Power Efficiency & Environmental Protection (CenPEEP), which provides electricity support to other electricity generation companies. Also, NTPC has targets for all their plants to reduce the amount of coal used per unit of electricity that is generated. So, they are doing that as part of the PAT programme.

Enforcement and monitoring are major challenges. What is your approach to dealing with these?
Our approach is one of self certification by third party verification. So, whether it is the labels that are put on ACs or refrigerators etc.,or the PAT targets, the first thing is that the manufacturer of the appliances or designated consumer share their achievement. What we then do is get third parties to check these claims. So, in the case of appliances, we buy them from the market and send them for testing, to make sure that they are labelled correctly. In case of PAT, there are accredited energy auditors that go to each designated consumer and then verify whether the results are correct or not.

What suggestions would you recommend be taken up to further aid this cause?
The first key issue is that you and I have certain energy consumption due to our behaviour, e.g. I drive to work, and that consumes energy. Can I change my behaviour? I think each one of us needs to ask ourselves, what are the behavioural changes we can make to reduce our energy needs, without impacting our productivity. The second is to do with technology, e.g. whenever you buy a new technology make sure that it is efficient. But, even for the ones that we already have at home, see when it makes sense to change it, e.g. if you have an AC while it was made in 2007, if you can change it to a recent one, that will save you money. So, behaviour on one hand and technology on the other.

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