Cabinet OKs energy efficiency plan

Jun 28, 2010

Source Name: 

Times of India

Source Url: 

http://timesofindia.indiatimes.com/india/Cabinet-OKs-energy-efficiency-plan/articleshow/6088416.cms

The Union Cabinet on Thursday approved the ambitious National Mission for Enhanced Energy Efficiency — one of the eight missions under the National Action Plan on Climate Change. 

The mission is expected to save 23 million tonne oil equivalent of fuel and avoid the need to build additional capacity of over 19,000MW. 

Speaking after the Cabinet approval, the secretary, ministry of power said: ''This is a significant development for India. During the next four years, the mission will help achieve greenhouse gas emissions reduction of 98.55 million tonnes per year.'' The mission will also kick-start the country's first market-based trading in energy efficiency savings. Just like the international carbon trade, a domestic trade in energy saving certificates would facilitate this process. 

Ajay Mathur, director general of the Bureau of Energy Efficiency, who has also been designated the mission director said, ''The mission will help unlock the market for energy efficiency on a public-private partnership (PPP) basis, which is estimated to be around Rs 74,000 crore.'' 

The larger industrial units in the key fuel-guzzling sectors will be set targets to increase their efficiency levels. They will be able to partly offset such targets under the certificates they buy from those who have achieved beyond their designated targets. 

This is expected to reducethe economy-wide costs of moving to a more energy efficient path. 

The Bureau of Energy Efficiency has already been working with the industry to set up the norms for the scheme, which will be the first of its kind in developing countries and will add towards the country's target of reducing its emission intensity by 20-25% below 2005 levels. 

Besides the efficiency-trading mechanism, the mission also includes an Energy Efficiency Financing Platform, which will provide fiscal tools in aid of projects that work to reduce demand of energy. Alongside, the mission will develop two fiscal instruments to promote energy efficiency — the Partial Risk Guarantee Fund and Venture Capital Fund for Energy Efficiency.
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