Energy Conservation Activities by BEE Presentation by Sandeep Garg Energy Economist, Bureau of Energy Efficiency, Ministry of Power, Government of India

1
Energy Conservation Activities by
BEEPresentation bySandeep GargEnergy
Economist, Bureau of Energy Efficiency, Ministry
of Power, Government of India
2
Energy Conservation and Efficiency- Potential and
Action Plan
3
Portfolio Development for Energy Efficiency

• Enactment of enabling legislation (Energy
  Conservation Act, 2001)
• Institutional arrangements at central and state
  level for regulatory oversight (BEE and SDAs)
• Putting in place a multi- sectoral policy for
  energy efficiency Integrated Energy Policy
  (IEP), 2006
• Energy Efficiency Action Plan Medium Term- with
  aspirational goals
• National Mission for Enhanced Energy Efficiency
  for greater thrust on energy efficiency
• Public sector corporate entity Energy Efficiency
  Services Ltd (EESL) for implementation leadership
  being set up
• Independent monitoring and verification of energy
  savings- being undertaken by National
  Productivity Council (NPC)

4
Indian Energy Sector
327 Mtoe
1858 Mtoe
Energy requirement to increase at a CAGR of 6.4
(2004-2032) and coal to remain the mainstay
Source Planning Commission, 2006
5
The Energy Scenario(Selected Energy
Indicators )
Integrated Energy Policy ,Planning Commission
,2006
6
Energy Efficiency Potential and Outcome
Energy Conservation potential assessed as at present (IEP) (15 by DSM and 25 overall) - 20000MW
Verified Energy Savings Verified Energy Savings
During X Plan period During 2007-08 and 2008-09 Target for 2009-10 - 877 MW 2127 MW 2600 MW
-Target for XI Plan period (5 reduction of energy consumption) - 10000 MW
Only as indicated by participating units in the National Energy Conservation award scheme, for the previous five years. Only as indicated by participating units in the National Energy Conservation award scheme, for the previous five years. Only as indicated by participating units in the National Energy Conservation award scheme, for the previous five years.
7
Potential of Energy Savings
S.No. Market Type Investment Potential, bn Rs Energy Savings (KWh) Energy Savings (MW) PayBack Period (Years)
1 Industrial 121 49.00 billion 7000 0.5
1 Generic Energy Efficiency 42 23.70 billion 3400 0.5
1 Process Energy Efficiency 79 25.30 billion 3600 0.5
2 Commercial 5.7 1.71 billion 553 0.7
2 Government Owned        
2 Offices        
2 Hospitals 3.4 0.76 billion 360 1
2 Private Owned 0.85 0.87 billion 140 0.2
2 Hotels 1.44 0.18 billion 53  
3 Municipal 13 3.70 billion 1688 0.9
4 Totals 140 54.40 billion 9240 0.6
S. No. Sector Potential
1. Industry 10 25
2. Lighting 30 35
3. Commercial Buildings 50
4. Agriculture 40 45
Source ADEE, Econoler, IREDA and TERI, Demand Side Management from a sustainable development perspective, 2003 Source ADEE, Econoler, IREDA and TERI, Demand Side Management from a sustainable development perspective, 2003 Source ADEE, Econoler, IREDA and TERI, Demand Side Management from a sustainable development perspective, 2003
8
Demand Side Interventions- Potential and
Opportunities
Sectoral Intervention Potential Energy Savings Likely Investments by Private Sector
Agriculture 60 b KWh Rs. 15,000 crores
Municipalities 3.7 b KWh Rs. 1,600 crores
Buildings 3.52 b KWh Rs. 1,200 crores
Industry 98 b KWh Rs. 24,000 crores
Lighting 70 b KWh Rs. 4,000 crores
Source BEE, Ministry of Power, Government of
India ADB (2004)
9
Electrical Energy Consumption and Conservation
Potential
S. No. Sector Consumption ( b KWh) Saving Potential ( b KWh) Savings
1. Agriculture Pumping 92.33 27.79 30.09
2. Commercial Buildings/ Establishments with connected load gt 500 KW 9.92 1.98 19.95
3. Municipalities 12.45 2.88 23.13
4. Domestic 120.92 24.16 19.98
5. Industry (Including SMEs) 265.38 18.57 6.99
Total 501.00 75.36 15.04
Source BEE/ NPC Study 2009
10
Energy Efficiency Action Plan

• Bachat Lamp Yojana to promote energy efficient
  and high quality CFLs as replacement for
  incandescent bulbs in households.
• Standards Labeling Scheme targets high energy
  end use equipment and appliances to lay down
  minimum energy performance standards.
• Energy Conservation Building Code (ECBC) sets
  minimum energy performance standards for new
  commercial buildings.
• Agricultural and Municipal DSM targeting
  replacement of inefficient pumpsets, street
  lighting, etc.
• Operationalising EC Act by Strengthening
  Institutional Capacity of State Designated
  Agencies (SDAs) The scheme seeks to build
  institutional capacity of the newly created SDAs
  to perform their regulatory, enforcement and
  facilitative functions in the respective States.
• Energy Efficiency Improvement in Small and Medium
  Enterprises (SMEs) To stimulate energy
  efficiency measures in 25 high energy consuming
  small and medium enterprise clusters.

11
Government Leadership in Creating EE Market in
India
12
Creating Demand for Energy Efficiency
-Preparation of bankable projects in various
sectors like Government Buildings,
Municipalities, Agriculture, SMEs- About 1200
projects to be ready for implementation in one
year with an estimated investment of about USD 1
billion -Mandating all large Government buildings
to undertake energy efficiency in 3 years- about
8000 large buildings with investment potential of
USD 2 billion -Setting appliance standards and
making them mandatory -Setting up norms for large
energy intensive industries like Thermal Power,
Fertilizer, Cement, Pulp Paper, Chlor Alkali,
Steel, Textiles, Railways and Aluminum
Investment in new technologies of USD 6 b
expected -Massive mass media campaign to enhance
awareness amongst stakeholders -National Energy
Conservation Awards for best performing
industries in energy efficiency -National
Painting Competition to enhance awareness amongst
young children over 2 million children
participated in last 4 years
13
Promoting Supply of Energy Efficiency Goods and
Services
-Promotion of ESCOs 35 ESCOs empanelled and
rated through leading rating agencies of India
(CRISIL/ ICRA) -List of ESCOs being expanded to
at least double this number -Bi-annual National
Examination for certification of Energy
Management Professionals 8 exams conducted and
8000 Energy Managers and Auditors certified -10
equipments covered under the Standards and
Labeling programme (ACs, Refrigerators,
Tubelights, Distribution Transformers, Ceiling
Fans, Pumps, Motors, Colour TVs, Geysers and LPG
Stoves). Standards for first 4 equipments is now
mandatory by January, 2010. -Training of energy
efficiency professionals in all sectors like the
states, buildings, appliances, SMEs, etc.
14
Enabling Finance for Energy Efficiency Goods and
Services
-Creation of Energy Efficiency Financing Platform
(EEFP) to provide non-recourse financing to ESCO
projects- 2 Financial Institutions have joined
and commenced financing (PTC India Ltd and
SIDBI) -Provision of Partial Risk Guarantee Fund
for provide partial guarantees to ESCO projects-
part of NMEEE and World Bank and GEF providing
Technical Assistance for setting it up -Setting
up of Venture Capital Fund to provide last mile
equity to enable financial closure of ESCO
projects part of NMEEE -Training modules for
banks and financial institutions prepared and
training initiated to enhance awareness about
performance contracting and appraisals thereof. -
Tax incentives for ESCOs being proposed
15
National Mission for Enhanced Energy Efficiency
(NMEEE)
16
NMEEE-4 New Initiatives

• 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 (EEFP))
• Developing fiscal instruments to promote energy
  efficiency namely Framework for Energy Efficient
  Economic Development (FEEED)

16
17
Objectives of NMEEE

• The basic tenet of the mission is to ensure a
  sustainable growth by an appropriate mix of 4 Es
  namely- Energy, Efficiency, Equity and
  Environment.
• Promote development objectives, while also
  yielding co-benefits for addressing climate
  change effects.
• 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
• Market based approach to implementation of energy
  efficiency market size of USD 18 b to be
  unlocked

18
Perform Achieve and Trade (PAT)

• (a) Methodology for setting Specific Energy
  Consumption (SEC) norm for each designated
  consumer
• Differential targets for different Designated
  Consumers on a gate-to-gate basis
• For thermal power plants and fertilizer plants,
  the SEC targets to be harmonised with current
  tariff setting context CERC and Ministry of
  Fertilizer to undertake this
• Detailed baselines to be measured and verified by
  BEE
• (b) Promotion of Trading of ESCerts
• Verification by accredited verification agency or
  by energy auditors,
• Issuance process for Energy Savings Certificates
  (ESCerts) who exceed their target SEC reduction-
  transparent regulatory framework for their
  issuance, monitoring and verification, and
  reconciliation protocols outlined.
• Trading Process for ESCerts - can be carried out
  bilaterally between any two designated consumers
  (within or across the designated sectors), or on
  special platforms for their trading which are
  created in the power exchanges
• Compliance and reconciliation process for
  ESCerts- accounting and depository protocols to
  be evolved

19
Perform Achieve and Trade (PAT) (2)

• (c) Fungibility of ESCerts
• MNRE may take this fungibility into consideration
  while formalizing the REC structure.
• A joint group of the agencies to agree to the
  linkage mechanism between the RECs and the
  ESCerts once both the mechanisms are operational
• The conversion factor must be transparent based
  on verifiable parameters like kgoe
• (d) Amendments to EC Act, 2001
• Financial Penalty for Non-compliance u/s 26 of EC
  Act to be enhanced- The penalty should be greater
  than the cost of equivalent energy to meet the
  shortfall in targets
• DCs may be allowed to meet their obligation
  through purchase of ESCerts, by way of an
  enabling amendment in section 14 of the Act.
• (e)PAT mechanism is a purely national scheme. SEC
  reduction targets under the PAT mechanism do not
  create any international obligations. Has no
  linkage to any international financial instrument
  for emission reductions.

20
Perform Achieve and Trade (PAT) (3) Legal Mandate

• The Energy Conservation Act, 2001, provides a
  legal mandate for energy-efficiency regulations
  for industry
• Under the EC Act, units in nine sectors, with
  energy consumption exceeding specified
  thresholds, have been notified as designated
  consumers
• Power ? Fertilizer
• Iron steel ? Cement
• Pulp paper ? Aluminum
• Chlor-alkali ? Textile
• Railways

21
Designated Consumers

• Designated Consumers are, inter alia, required
  to
• appoint certified energy managers,
• undergo specific energy audits,
• report energy consumption data, and
• comply with prescribed energy consumption norms.
• BEE certifies energy managers (through a national
  exam), and accredits energy auditors
• About 5,000 energy managers have been certified
• Energy Consumption Returns are being filed
• Designated Consumers use about 240 Mtoe per year
• Specific energy consumption is decreasing at
  about 4 p.a.
• E-filing network has been established
• Energy consumption norms are being prescribed

22
Setting energy consumption norms - Challenges

• Sectors (e.g. steel, cement, paper) are
  everywhere characterized by great diversity in
  terms of
• Scale
• Technology pathways
• Technology vintages
• Project boundaries
• Type and quality of inputs/resource endowment
• Product diversity

23
(No Transcript)
24
Typical Power Consumption Break-Up In Fertilizer
Industries
Department Calculated Break-Up (Share)
Urea 14.80
Ammonia 8.06
Utility 67.96
Lighting 6.33
Losses 2.84
9.82 Gcal/MT
Unit IFFCO - Kalol
25
Some Revealing Facts
Thermal System

1. 6 oC rise in boiler feed water temp. would lead
   to 1 improvement in thermal efficiency.
2. 20 oC reduction in stack temp. would lead to 1
   improvement in thermal efficiency.
3. 1 kg/hr of flash steam loss due to improper
   condensate recovery (at 90 boiler efficiency
   0.10 paise/kcal)leads to loss of Rs.6000/year.
4. Heat loss from 1 m2 non-insulated steam
   pipe(Surface temp. 180OC,ambient 35 oC)would cost
   Rs.15000/year,considered for a boiler efficiency
   of 90 and fuel cost of 0.10 paise/kcal.

26
Continue
Compressed Air System

1. 1 Kg/cm2 reduction in operating pressure reduces
   5 in electricity.
2. Loss of 1 cfm through leakages at 100 PSI cost
   Rs. 5500/year (4 Rs./Kwh).
3. Every 5oC temp. rise in intake air temp.
   increases the power consumption by 1.
4. Every 5oC rise in inlet air temp. of second stage
   due to improper cooling, the specific power
   consumption increases by 2 .
5. Pressure drop of 200 mmWC across the inlet air
   filter increases the power consumption by 1.5.

27
Continue
Refrigeration System

• 5oC Reduction in Evaporator temp. reduces 8 to 10
  in Electricity.
• Separation of low and high temp. applications
  gives substantial savings.
• Vapour Absorption System (VAHP) is viable against
  Vapour Compression System, if the Electricity to
  fuel cost ratio is greater than 4.

28
Continue
Pumping System

1. Discrimination of low head and high head
   applications gives substantial savings.
2. Coating of pump internals increases the pump
   efficiency by 3 - 4.
3. Elimination of un-due throttling and overall flow
   balancing of close- loop system gives substantial
   saving.
4. Application of variable speed drive.
5. Optimization of parallel pump running.

29
Continue
Electrical System

1. Tariff Structure
2. Analysis of Plant Demand Profile
3. Transformer Rationalization
4. Power Factor Optimization
5. Motor Load Rationalization
6. Voltage Reduction in Lightings
7. The use of Electronic Ballast in Tube Light
   Circuit

30
Exceed and Trade
Large bandwidth- difficult to have one norm for
the sector
31
Diversity within Sectors in India - Capacity
Large variation in scale of production capacities
32
Diversity within Sectors in India Specific
Energy Consumption

• 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

33
Creation of Energy Efficiency Services Ltd (EESL)
(a) Joint Venture between 4 Public Sector
Companies under MOP- Main implementation arm of
the National Mission for Enhanced Energy
Efficiency initial equity of USD 45
million. (b) Lead in implementing energy
efficiency projects as a Super ESCO (c) Provide
partial risk guarantee fund/ venture capital fund
to ESCOs (d) Leverage multilateral and bi-lateral
financing (e) Enter into partnerships, JVs with
other implementing partners like ESCOs, industry,
etc. to promote energy efficiency. (f) Provide
consultancy services to private and public sector
in the areas of energy efficiency, CDM, etc. (g)
Take up revenue generating activities of BEE like
implementing Standards and Labeling Programme,
National Examination, etc.
34
Exceed and Trade- EE Bands

• Decrease the energy-efficiency bandwith of the
  sector
• Tin tries harder than bronze, , Gold sets world
  standards

35
Plan of Action/ Timelines- Exceed and Trade

• Specification of specific energy consumption norm
  for each designated consumer in the baseline year
  and in the target year- Statutory requirement for
  designated consumers under EC Act
• Verification of the specific energy consumption
  of each designated consumer in the baseline year
  and in the target year by an accredited
  verification agency
• Issuance of Energy Savings Certificates (ESCerts)
  to those designated consumers
• Checking of compliance and Reconciliation of
  ESCerts
• Trading of ESCerts

36
Institutional Mechanism

6. Third party Audit auditors
3. Industry A
4. Stock Exchange
3. Industry B
2. BEE Services Ltd
EScert Reports
Transfer agent
Depository
Clearing House and EScert issuance

• Bureau of
• Energy Efficiency

Compliance Directive
1 ESCert 100 kWhr
37
Exceed and Trade- Roles
Institution Role Responsibility Authority Current Indian Examples
Policy Governor and Compliance Driver Compliance assurance through incentives and automatic penalties Reduce conflict of Interest Accredit independent 3rd party Energy auditors Sets Compliance benchmarks Resolve disputes through collaborative approach with petition process Bureau of Energy Efficiency (BEE)
Market Governor Ensure publicly available data Maintain centralized data administration strong quality assurance level playing field Issue of ESC Bureau of Energy Efficiency Services Ltd (BEESL) (proposed)
Industry Undertake energy efficiency measures Appoint accredited 3rd party energy auditors Maintain compliance with set energy efficiency benchmark -- Designated Consumers etc
Stock Exchange Maintain data of traded prices, traded volumes and trends. Create efficient and transparent market for trading safeguard market integrity and enhance transparency in operations NCDEX, MCX
Transfer Agents / Depositories Hold the ESC in electronic form. Provides services related to transactions in ESC. -- KARVY, CAMS, NSDL, CDSL
Third Party energy Auditors -- Audit industry energy savings Recommendation for the issue of ESCerts All Designated Operational Entities like TUV etc
38
Market Transformation driven DSM

• Lighting DSM
• Reducing cost of efficient light
• Awareness/ facilitation
• Standards and Labelling
• Mandating standards
• Awareness/ outreach
• Commercial Buildings
• New codes for commercial buildings
• Development of ESCO market for existing buildings
• Agriculture DSM
• Replacement of inefficient pumpsets with
  star-rated on PPP mode
• Municipal DSM
• Replacement of pumpsets with star rated on PPP
  mode
• Replacement of street lighting on PPP mode
• PAT Scheme
• Issue of ESCerts
• CDM
• Programmatic approach
• Issue of CERs