bee book 1.2

8/13/2019 bee book 1.2

1/28

8/13/2019 bee book 1.2

2/28

2 Energy Conservation Act-2001 and Related Policies

Energy Energy means any form of energy derived from fossil fuels, nuclear substances ormaterials, hydro-electricity and includes electrical energy or electricity generated from renewablesources of energy or biomass connected to the grid.Energy audit Energy audit means the verification, monitoring and analysis of use of energyincluding submission of technical report containing recommendations for improving energyefficiency with cost benefit analysis and an action plan to reduce energy consumption.Energy conservation building codes It means the norms and standards of energy consumptionexpressed in terms of per square meter of the area and wherein energy is used and includes locationof the building.Energy consumption standards t means norms for process and energy consumption standards.Energy savings certificate Energy savings certificate means any energy savings certificate issuedto the designated consumers.Equipment or appliance It means any equipment or appliance which consumes, generates,transmits or supplies energy and includes any device that consumes any form of energy andproduces a desired work.Powers and Functions o Bureau13. 1) The Bureau shall, effectively co-ordinate with designated consumers, designated agenciesand other agencies, recognize and utilise the existing resources and infrastructure, in

performing the functions assigned to it by or under this Act.2) The Bureau may perform such functions and exercise such powers as may be assigned to it

by or under this Act and in particular, such functions and powers include the function andpower toa) recommend to the Central Government the norms for processes and energy consumptionstandards required to be notified under section 14A;aa) recommend to the Central Government for issuing of the energy savings certificate.b) recommend to the Central Government on display label on equipment or on appliances andmanner of display under clause d) of section 14;c) recommend to the Central Government for notifying any user or class of users of energy as adesignated consumer under clause e) of section 14;d) take suitable steps to prescribe guidelines for energy conservation building codes under

clause p) of section 14;e) take all measures necessary to create awareness and disseminate information for efficient use

of energy and its conservation;f) arrange and organize training of personnel and specialists in the techniques for efficient use

of energy and its conservation;g) strengthen consultancy services in the field of energy conservation;

Bureau of Energy Efficiency 28

8/13/2019 bee book 1.2

3/28

2. Energy Conservation Act-2001 nd Related Policies

h) promote research and development in the field of energy conservation;i) develop testing and certification procedure and promote testing facilities for certification andtesting for energy consumption of equipment and appliances;G formulate and facilitate implementation of pilot projects and demonstration projects for

promotion of efficient use of energy and its conservation;k) promote use of energy efficient processes, equipment, devices and systems;0 promote innovative financing of energy efficiency projects;m)give financial assistance to institutions for promoting efficient use of energy and itsconservation;n) levy fee for services provided for promoting efficient use of energy and its conservation;o) maintain a list of accredited energy auditors as may be specified by regulations;p) specify, by regulations, the qualifications, criteria and conditions subject to which a personmay be accredited as an energy auditor and the procedure for such accreditation;q) specify, by regulations, the manner and intervals of time in which the energy audit shall beconducted;r) specify, by regulations, certification procedures for energy managers and energy auditors to

be designated or appointed by designated consumers;s) prepare educational curriculum on efficient use of energy and its conservation for educationalinstitutions, boards, universities or autonomous bodies and coordinate with them forinclusion of such curriculum in their syllabus;sa) conduct examination for capacity building and strengthening of services in the field ofenergy conservation including certification of energy managers and energy auditors.t) implement international co-operation programmes relating to efficient use of energy and its

conservation as may be assigned to it by the Central Government.Power o Central Government t Facllitate and Enforce Emcient Use o Energy and itsConservation CHAPTER V)14. Central Government may, by notification, in consultation with the Bureau,-

a) specify the norms for processes and energy consumption standards for any equipment,appliances which consumes, generates, transmits or supplies energy;b) specify equipment or appliance or class of equipments or appliances, as the case may be, forthe purposes of this Act;c) prohibit manufacture or sale or purchase or import of equipment or appliance specified underclause b) unless such equipment or appliances conforms to energy consumption standards;

- Provided that no notification prohibiting manufacture or sale or purchase or import orequipment or appliance shall be issued within a period of six months from the date ofnotification;- Provided further that the Central Government may, having regard to the market share andthe technological development having impact on equipment or appliance, and for reasons

Bureau ofEnergy Efficiency 9

8/13/2019 bee book 1.2

4/28

2. Energy Conservation Act-2001 and Related Policies

to be recorded in writing, extend the said period of six months referred to in the firstproviso by a further period not exceeding six months;d) direct display of such particulars on label on equipment or on appliance specified and in suchmanner as may be specified by regulations;e) specify, having regarding to the intensity or quantity of energy consumed and the amount ofinvestment required for switching over to energy efficient equipments and capacity orindustry to invest in it and availability of the energy efficient machinery and equipmentrequired by the industry, any user or class of users of energy in the energy intensiveindustries and other establishment as a designated consumer;f) alter the list of Energy Intensive Industries specified in the Schedule;g) establish and prescribe such energy consumption norms and standards for designatedconsumers as it may consider necessary:

- Provided that Central Government may prescribe different norms and standards fordifferent designated consumers having regard to such factors as may be prescribed;h) direct, having regard to quantity of energy consumed or the norms and standards of energyconsumption the energy intensive industries specified in the Schedule to get energy auditconducted by an accredited energy auditor in such manner and intervals of time as may bespecified by regulations;i) direct, if considered necessary for efficient use of energy and its conservation, any designatedconsumer to get energy audit conducted by an accredited energy auditor;G specify the matters to be included for the purposes of inspectionk) direct any designated consumer to furnish to the designated agency, in such form and mannerand within such period, as may be prescribed, the information with regard to the energyconsumed and action taken on the recommendation of the accredited energy auditor;1) direct any designated consumer to designate or appoint energy manger in charge of activitiesfor efficient use of energy and its conservation and submit a report, in the form and manner asmay be prescribed, on the status of energy consumption at the end of the every financial year

to designated agency;m)prescribe minimum qualification for energy managers to be designated or appointed underclause l);n) direct every designated consumer to comply with energy consumption norms and standards;o) direct any designated consumer, who does not fulfill the energy consumption norms andstandards prescribed under clause g), to prepare a scheme for efficient use of energy and itsconservation and implement such scheme keeping in view of the economic viability of theinvestment in such form and manner as may be prescribed;p) prescribe energy conservation building codes for efficient use of energy and its conservationin the building or building complex;q) amend the energy conservation building codes to suit the regional and local climaticconditions;

r) direct every owner or occupier of the building or building complex, being a designatedconsumer to comply with the provisions of energy conservation building codes for efficientuse of energy and its conservation;s) direct, any designated consumer referred to in clause r), if considered necessary, for efficientuse of energy and its conservation n his building to get energy audit conducted in respect of


8/13/2019 bee book 1.2

5/28


such building by an accredited energy auditor n such manner and intervals of time as may bespecified by regulations;t) take all measures necessary to create awareness and disseminate information for efficient useof energy and its conservation;u) arrange and organise training of personnel and specialists in the techniques for efficient useof energy and its conservation;v) take steps to encourage preferential treatment for use of energy efficient equipment orappliances:

14A 1) The Central Government may issue the energy savings certificate to the designatedconsumer whose energy consumption is less than the prescribed norms and standards inaccordance with the procedure as may be prescribed.2) The designated consumer whose energy consumption is more th n the prescribed normsand standards shall be entitled to purchase the energy savings certificate to comply with theprescribed norms and standards.

14B The Central Government may, in consultation with the Bureau, prescribe the value of permetric ton of oil equivalent of energy consumed for the purposes of this Act.

Power of State Government to facilitate and Enforce Efficient Use of Energy and itsConservation15. The State Government may, by notification, in consultation with the Bureaua) amend the energy conservation building codes to suit the regional and local climaticconditions and may. by rules made by it, specify and notify energy conservation buildingcodes with respect to use of energy in the buildings;

b) direct every owner or occupier of a building or building complex being a designatedconsumer to comply with the provisions of the energy conservation building codes;c) direct, i considered necessary for efficient use of energy and its conservation, any designatedconsumer to get energy audit conducted by an accredited energy auditor n such manner andat such intervals of time as may be specified by regulations;d) designate any agency as designated agency to coordinate, regulate and enforce provisions ofthis Act within the State;e) take all measures necessary to create awareness and disseminate information for efficient use

of energy and its conservation;f) arrange and organise training of personnel and specialists in the techniques for efficient use

of energy and its conservation;g) take steps to encourage preferential treatment for use of energy efficient equipment orappliances;h) direct, any designated consumer to furnish to the designated agency, in such form andmanner and within such period as may be specified by rules made by it, information withregard to the energy consumed by such consumer;i) specify the matters to be included for the purposes of inspection.


8/13/2019 bee book 1.2

6/28


Establishment of und by State Government16. 1) The State Government shall constitute a Fund to be called the State Energy ConservationFund for the purposes of promotion of efficient use of energy and its conservation within theState.

2) To the Fund shall be credited all grants and loans that may be made by the State Governmentor, Central Government or any other organization or individual for the purposes of this Act.3) The Fund shall be applied for meeting the expenses incurred for implementing the provisionsof this Act.4) The Fund created shall be administered by such persons or any authority and in such manneras may be specified in the rules made by the State Government.

Power of inspection17. 1) The designated agency may appoint, after the expiry of five years from the date ofcommencement of this Act, as many inspecting officers as may be necessary for the purpose

of ensuring compliance with energy consumption standard or ensure display of particulars onlabel on equipment or appliances specified or for the purpose of performing such otherfunctions as may be assigned to them.2) Subject to any rules made under this Act, an inspecting officer shall have power to - a) inspect any operation carried on or in connection with the equipment or appliancespecified in respect of which energy standards have been specified;b) enter any place of designated consumer at which the energy is used for any activity andmay require any proprietor, employee, director, manager or secretary or any other personwho may be attending in any manner to or helping in, carrying on any activity with thehelp of energy -

i) to afford him necessary facility to inspect -A any equipment or appliance as he may require and which may be available at suchplace;B. any production process to ascertain the energy consumption norms and standards;

ii) to make an inventory of stock of any equipment or appliance checked or verified byhim;i i i to record the statement of any person which may be useful for, or relevant to, forefficient use of energy and its conservation under this Act.

3) inspecting officer may enter any place of designated consumera) where any activity with the help of energy is carried on; andb) where any equipment or appliance notified has been kept, during the hours atwhich such places is open for production or conduct of business connectedtherewith.


8/13/2019 bee book 1.2

7/28


Power of entral Government or State Government to issne directions18. The Central Government or the State Government may, in the exercise of its powers andperformance of its functions under this Act and for efficient use of energy and itsconservation, issue such directions in writing as it deems fit for the purposes of this Act to

any person, officer, authority or any designated consumer and such person, officer orauthority or any designated consumer shall be bound to comply with such directions.Explanation - For the avoidance of doubts, it is hereby declared that the power to issuedirections under this section includes the power to direct -

a) Regulation of norms for process and energy consumption standards in any industry orbuilding or building complex; orb) Regulation of the energy consumption standards for equipment and appliances.Penalties and Adjudication

Penalty for each offence under the Act would be in monetary terms i.e. Rs.lO lakhs eachoffence and Rs.lO,OOO for each day for continued non Compliance. The power to adjudicate has been vested with State Electricity Regulatory Commissionwhich shall appoint any one of its member to be an adjudicating officer for holding anenquiry in connection with the penalty imposed.

State Designated AgenciesAs per Energy Conservation Act 2001, State Governments have been empowered to designateagencies State Designated Agency i.e. SDA) in consultation with Bureau of Energy Efficiency.Designated Agencies will have the responsibility to implement the Act within the State.esponsibilities

Spread awareness on EC Act Undertake voluntary initiatives to promote energy conservation Liaison and coordinate with BEE, State Government Departments dealing with energy,industry, planning, regulators, consumer affairs, municipal bodies etc. Capacity building of staff employedo Launch and maintain state specific website addressing the voluntary and mandatory

provisions of EC Act Undertake energy conservation awareness program for consumers, industrial commercialsector, school children, farmers etc.0 Arrange interactive meets between energy managers, energy auditors, designated consumersand other experts


8/13/2019 bee book 1.2

8/28

2. Energy Conservation Act-2001 and Related PoliciC

uties Prepare a list ofdesignated consumers Compile information received from designated consumers through annual statements onenergy consumption, energy audit reports, and action taken on the report of energy audit Prepare a state and sectoral energy data base and provide the feed back to designatedconsumers Take all measures necessary to create awareness and disseminate information for efficientuse of energy and it s conservation Arrange and organize training of personnel and specialists in the techniques for efficient useofenergy and its conservation Take steps to encourage preferential treatment for use o energy efficient equipment orappliances Appoint or designate inspecting officer with specified powers as necessary for the purpose ofensuring compliance with energy consumption standards Assist State Government in the preparation of Rules under Section 57 of the Energy

Conservation Act Establish Energy Conservation Fund for the purposes of promotion of efficient use of energyand its conservation within the State2.3 Schemes ofBEE under the Energy Conservation Act-2001

Energy Conservation Building Codes (ECBC) Standards and Labeling (S L Demand Side Management (DSM) Bachat Lamp Yojana (BLY Promoting Energy Efficiency in Small and Medium Enterprises (SMEs) Designated Consumers Certification of energy auditors and energy managers

Energy Conservation Building Codes (ECBC)

Energy Conservation BuildingCodes (ECBC) was developed todeal with rapidly increasing energyconsumption in commercialbuildings. ECBC sets minimumenergy efficiency standards fordesign and construction ofcommercial buildings.

ECBC encourages energy efficientdesign or retrofit ofbuildings so thatEnergy Conservat ion

cw ' u i lding Codes ECBC) Building function, comfort, health and the productivity of the occupants is considered

BureauofEnergy Efficiency 34

8/13/2019 bee book 1.2

9/28


Life cycle costs (i.e. construction and energy cost are minimized)ECBC defines the norms of energy requirement per sq.metre of area and takes into consideration theclimatic region of the country, where the building is located. The owners or occupiers have tocomply with energy consumption norms and standards and or to prepare and implement schemesfor its efficient use and conservation. Central Government can prescribe energy conservationbuilding codes and direct owners/ occupiers to comply with them. State Governments can modifythe codes to suit regional and local climatic conditions.Standards and Labeling (S L)There is a wide variation in energy conswnption of similarproducts by various manufacturers. Also information on energyconsumption is often not easily available. This leads tocontinued manufacture and purchase of inefficient equipmentand appliances.

~ 2 r UEE STAR LABEL

Standards and Labeling (S L) has been identified as a keyactivity for energy efficiency improvement. he S&L program,when in place, would ensure that only energy efficientequipment and appliances would be made available to theconsumers.The main provision of EC act on Standards and Labeling are:

i s 110,,.M N T ORY loW J ru >t l 'ftC l t c f r t ~ u n A

8/13/2019 bee book 1.2

10/28


Relationship between Standards and Labeling: The labeling programs are the best way toimplement standards. The labels serve as a compliment to standards. The labels can either providedetailed information about a product's energy performance, or simply indicate that a product has metcertain energy performance. Labels also provide useful visual information about standards to theconsumer, and are the main instrument of market transformation. The label programs can alsoprovide useful data for updating Standards.Minimum Energy Consumption and Performance Standard s MEPS): MEPS states lower limitfor energy consumption for a defined pw:pose. After a transition period (i.e. 2-3 years), during whichmanufacturers are required to convert their facility to produce equipment which conform to MEPS,no manufacturer can sell specified product i it does not conform to the minimum standards. Thisensures level of efficiency increase in domestic appliances and engineering products.Star Ratings: Star rating is a system initiated by BEE to determine energy efficiency of anappliance like air conditioner. Depending upon their energy efficiency, they are rated on a scale of 1- stars. Star ratings starts from one star (which is the least energy efficient and hence the least moneysaved) to stars (which is the most energy efficient). Star ratings are affixed on appliances aftertesting in BEE accredited laboratories. A manufacturer has to register with BEE to get the starratings, and get their products tested in laboratories. Label indicates the energy efficiency levelsthrough the number of stars highlighted in colour on the label. t is being applied to many productssuch as refrigerators, TVs, ACs and so on.Demand Side Management (DSM)Demand Side Management (DSM) means managing of the demand for power, by utilitiesDistribution companies, among some or all its customers to meet current or future needs. DSMprograms result in energy and or demand reduction. For example, under this process, the demandcan be shifted from peak to off peak hours thereby reducing the need for buying expensive importedpower during peak hours. DSM also enables end-users to better manage their load curve and thusimproves the profitability. Potential energy saving through DSM is treated same as new additions onthe supply side in MWs. DSM can reduce the capital needs for power capacity expansion.A pilot study undertaken by BEE has indicated energy saving potential of 40 by replacement ofinefficient pumps with Star rated pump sets. BEE has prepared an Agricultural DSM (Ag. DSM)programme in which pump set efficiency upgradation could be carried out by an Energy ServiceCompany (ESCOs) or Distribution Company. The implementation for replacement of inefficientpumps with Star rated pump sets will be done through the ESCO/Utility who would invest in energyefficiency measures on a rural pump set feeder on which supply quality enhancements (such asfeeder segregation High Voltage Direct Supply (HVDS) have already been carried out.Almost all municipal bodies depend on government support to meet their development and operatingexpenses. Government of India, through the Bureau of Energy Efficiency has initiated a municipalityDSM programme to cover 175 municipalities in the country by conducting investment grade energy


8/13/2019 bee book 1.2

11/28


audits and preparation of detailed project reports. Energy Service Companies are being encouragedto take up the implementationof the programme with the help of financial institutions.Bachat Lamp Yojana (BLYThe Bachat Lamp Yojana , which literally means Save LampScheme , aims at the large scale replacement of inefficientincandescent bulbs in households by Compact Fluorescent Lamps(CFLs). It seeks to provide CFLs to households at the price similarto that of incandescent bulbs and plans to use the CleanDevelopment Mechanism (CDM) to recover the cost differencebetween the market price of the CFLs and the price at which theyare sold to households. The scheme seeks to replace estimated 400million incandescent bulbs by CFLs which could save 6000 MWby 2012.

/

The Bachat Lamp Yojana is designed as a public-private partnership between the Government ofIndia, private sector CFL suppliers and State level Electricity Distribution Companies (DISCOMs).The CFL suppliers would sell high quality CFLs to households at a price of Rs. 15 per CFL within adesignated project area in a DISCOM region of operation.The CFL supplierwill be chosen by the DISCOM from a list of CFL suppliers empanelled by BEE.Under the scheme 60 Watt and 100 Watt incandescent Lamps will be replaced with 11- 15 Watt and20- 25 Watt FLs respectively. t is estimated that 80% energy savings can be achieved withoutaffecting lumen intensity.Promoting Energy Efficiency in Small and Medium Enterprises (SMEs)Energy Efficiency in the SME sector assumes importance because of the prevailing high costs ofenergy and supply related concerns. t will be useful to build their energy efficiency awareness byfunding/subsidizing need based studies in large number of units in the SMEs and giving energyconservation recommendations including rechnology upgradation opportunities. It is envisaged thatsuch interventions supported by diagnostic studies and pilot projects at cluster level focusing onenergy/resource efficiency, energy conservation and rechnology up gradation would be helpful inaddressing the cluster specific problems and enhancing energy efficiency in SMEs.Bureau of Energy Efficiency (BEE) is implementing a program (BEEts S ME Program) to improvethe energy performance in selected SME clusters. The objective of the program is to accelerate theadoption of energy efficient technologies and practices in the chosen SME clusters throughknowledge sharing, capacity building and development of innovative financing mechanisms. Theproject is envisaged to be driven by market based mechanism that include facilitating knowledgecreation at the local level, capacity building of local service providers and technology providers andthereafter facilitation of energy efficiency measures implementation through collateral funding bylead banks. The project is thus entirely market driven. Examples of clusters chosen for this projectare Ahmedabad (chemicals), Surat (textiles)t Warangal (rice milling) etc.

Bureauof Energy Efficiency 37

8/13/2019 bee book 1.2

12/28

2 Energy Conservation Act-2001 and Rehlted Policies

Designated Consumers (DC)The Central Government has notified the following 9 energy intensive industries as designatedconsumers under The EC Act 2001:No. Industry Energy consumption1 Thermal Power Stations 30,000 metric tonne of oil equivalent (MTOE) per year and above2 Fertilizer 30,000 metric tonne of oil equivalent (MTOE) per year and above3 Cement 30,000 metric tonne of oil equivalent (MTOE) per year and above4 Iron & Steel 30,000 metric tonne of oil equivalent (MTOE) per year and above5 Chlor-Aikali 12,000 metric tonne of oil equivalent (MTOE) per year and above6 Aluminium 7,500 metric tonne of oil eQuivalent (MTOE) per year and above7. Railways Electric traction Sub-Section (TSS), diesel loco shed, Productionunits and Workshops of Indian Railways having total annualenergy consumption of 30,000 MTOE or more under Ministry of

Railways8 Textile 3,000 metric tonne of oil eQuivalent (MTOE) per year and above9 Pulp Paper 30,000 metric tonne of oil equivalent (MTOE) per year and above

Energy Conversion values used for working out annual energy consumption in terms of metric tonne of oil equivalentFor the purpose of this tablei I kg of Oil Equivalent: 10000 kCalii) l Metric Tonne of Oil Equivalent (MTOE): 10 x 106 kCalill In case of coal, petroleum products and other fuels n absence of supplier certificate. GCV of the abcve fuel (fuelsample) will be considered as per the test Certificate from a NABL Accredited Lab or State Government Labnratory orGovernment recognized Laboratory

As per the Act, Designated Consumers have to fulfill the following criteria:Designated consumers have to appoint Energy managers with prescribed qualifications.The designated consumer has to get an energy audit conducted by an accredited energyauditor. Designated consumers would comply with prescribed norms and standards of energyconsumption for the industrial sectors.

Designated Consumers are required to adhere to energy efficient consumption normsstipulated.Designated Consumers are required to submit the status of energy consumption informationevery financial year as prescribed.

Certification of Energy Managers and Auditors:A cadre of professionally qualified energy managers and auditors with expertise in policy analysis,project management, financing and implementation of energy efficiency projects would bedeveloped through Certification and Accreditation programme. BEE has been designing trainingmodules, and regnlarly conducting a National level examination for certification of energy managersand energy auditors.


8/13/2019 bee book 1.2

13/28


Qualification for Accredited Energy Auditors and Maintenance o their list Regulations 2009n Energy Auditor shall be qualified to become an accredited energy auditor if he she-

(a) is a certified energy manager and has passed the examination in Energy PerformanceAssessment for Equipment and Utility Systems conducted by Bureau

(b) has an experience of five years in energy audit out of which atleast three years shall be in anyof energy intensive industries and

(c) has been granted a certificate of accreditation by the bureau.Accreditation Advisory Committee constituted by BEE for the purpose of grant of certificate ofaccreditation shall assess the energy audit experience and competence of energy auditor who hasapplied for certification of accreditation on the basis of an ora l interview.

2.4 Electricity Act 2003The government has enacted Electricity Act, 2003 which seeks to transform and develop theelectricity sector by distancing Government from the task of regulation.Before enactment of this act, electricity supply in India was governed by Indian Electricity Act,1910, the Electricity (Supply) Act, 1948 and the Electricity Regulatory Commissions Act, 1998.There was a need to consolidate the provisions of above act and consequently, Electricity Act, 2003was introduced.The objectives of the Act are:

To consolidate the laws relating to generation, transmission, distribution, trading and use ofelectricity To take measures suitable for development of electricity industry To promote competition To protect interest of consumers and supply of electricity to all areas To ensure transparent policies regarding subsidies To promote efficient and environmentally benign policies To constitute Central Electricity Authority (CEA), Regulatory Commissions

Main features o Electricity Act 2003 Generation free from licensing Captive generation free from control Re-structuring of State Electricity Boards Mandatory establishment of Regulatory Commissions Open access in transmission Open access in distribution to be allowed by State Regulators in phased manner Recognition of electricity trading as a distinct activity Stringent provisions for violation of grid discipline and theft ofpower


8/13/2019 bee book 1.2

14/28

2. Energy Conservation A

8/13/2019 bee book 1.2

15/28

2 Energy Conservation Act-2001 and Rehlted Policies

Renewable EnergyA significant regulatory impact on renewable energy was made by the Electricity Act, 2003, whichprovides for the detennination of quotas or Renewable Purchase Obligation (RPO) by the StateElectricity Regulatory Commissions (SERC). Internationally, this is commonly referred to as theRenewable Portfolio Standard (RPS). The RPS is a policy instrument that ensures that a mininmmamonnt of renewable energy is included in the portfolio of resources.The policy obligates each retail seller of electricity to include in its resource portfolio a certainproportion of power from renewable energy resources, such as wind, solar, small hydro and variousforms of biomass energy. The retailer can satisfy this obligation by both owning a renewable energyfacility and producing own power or purchasing power from someone s facility.Consumer

Consumer to be given connection within stipulated time. Penalty in case of failure to give connection Ombudsman scheme for consumers grievance redressal Regulatory commission to specify electricity supply code to be followed by licensees Appellate Tribnnal to hear appeals from consumer against the decision of the State andCentral Regulatory commissions Licensees are required to meet standards of performance specified by RegulatoryCommission. Failure to meet standards makes them liable to pay compensation to affectedperson within ninety days.

Trading arket DevelopmentTrading is being pennitted with licensing nnder the safeguard of the Regulatory Commissions.Regulatory Commissions also have authority to fix ceilings on trading margins, i necessary to avoidartificial price fluctuations.Role of Central Electricity Authority (CEA)

to continue as the main technical Advisor of the Govt. of India/ State Government with theresponsibility of overall planning to specify the technical standards for electrical plants and electrical lines to be technical adviser to CERC as well as SERCs to specify the safety standardsTariffPrinciples

Regulatory Commission is responsible to detennine tariff for supply of electricity bygenerating company on long/medium term contracts. No t riff fixation by regulatory commission i tariff is detennined through competitivebidding or where consumers, on being allowed open access, enter into agreement withgenerators/traders.


8/13/2019 bee book 1.2

16/28

2. Energy Conservation Act-2001 and Rcla ed Policies

Consumer tariff should progressively reduce cross subsidies and move towards actual cost ofsupply. State Government may provide subsidy in advance through the budget for specified targetgroups i it requires the tariff to be lower than that determined by the RegulatoryCommission. Regulatory Commissions may undertake regulation including determination of multi-yeartariffprinciples, which rewards efficiency and is based on commercial principles. Regulatory Commission will look at the costs of generation, transmission and distributionseparately.

2.5 Integrated Energy PolicyOverviewThe power supply position prevailing in the country ischaracterized by persistent power shortages, unreliability andalso high prices for industrial consumer. India depends onimported oil to extent of over 70 and this raises energysecurity concerns. Also consistency in policies governing eachsector and consistency in pricing of different types of energy islacking. There is a need to establish clarity in the direction thatmust be followed in aspects like energy security, addressingenvironmental concerns, energy conservation and Researchand Development. To achieve these objectives, acomprehensive review has been done to makerecommendations for integrated energy policyIndia needs to sustain 8 to 10 economic growth rate, overthe next 25 years, i it is to eradicate poverty and meet itshuman development goals. To deliver a sustained growth rateof 8 through 2031-32 and to meet the lifeline energy needs

Integrated Energy Polley' , l

8/13/2019 bee book 1.2

17/28


coal extraction technologies such as in-situ gasification to tap its vast coal reserves that are difficultto extract economically using conventional technologies.Need for Integrated Energy Policy

Policies affecting energy are determined by different Ministries: Petroleum Natural Gas,Coal, Power, Water Resources, Atomic Energy, New and Renewable Energy and FinanceMinistry for t x purposes. Policies in each sector have evolved independently across sectors and they do not take intoaccount responses arising from climate change. Globally energy prices are rising and domestic energy prices have to reflect these changes toencourage energy efficiency, and to encourage domestic investment in expanding energysupply.The main features of the policy can be summed up as follows:Reducing Energy Requirements through Energy Efficiency nd ConservationThe focus is on lowering the energy intensity of GDP growth through higher energy efficiency formeeting India's energy challenge and ensuring its energy security.Currently, India consumes 0.16 kg of oil equivalent (kgoe) per dollar of GDP. India's energyintensity is lower than the 0.23 kgoe of China, 0.22 kgoe of the US and a World average of 0.21kgoe. India's energy intensity is even marginally lower than that of Germany and OECD at 0.17kgoe. However, Denmark at 0.13 kgoe, UK at 0.14 kgoe and Brazil and Japan at 0.15 kgoe are aheadof India.Many sectoral studies confirm that there is scope to improve and energy intensity can be broughtdown significantly in India with current commercially available technologies. Lowering energyintensity tlrrough higher efficiency is equivalent to creating a source of untapped domestic energy.By implementing energy efficiency and conservation, it is possible to reduce energy intensity by upto 25% from current levels. Efficiency can be increased in energy extraction, conversion,transportation, as well as in consumption. Further, the same level of output or service can beobtained by alternate means requiring less energy. The major areas where efficiency in energy usecan make a substantial impact are mining, electricity generation, electricity transmission, electricitydistribution, water pumping, industrial production processes, haulage, mass transport, buildingdesign etc.Other policy measures include,

Establishing benchmarks of energy consumption for all energy intensive sectors.Increasing the gross efficiency in power generation from the current average of 30.5% to34%. U new plants should adopt technologies that improve their gross efficiency from theprevailing 36% to at least 38-40%.


8/13/2019 bee book 1.2

18/28


8/13/2019 bee book 1.2

19/28


Other proposed measures include:Private investment will be sought in all energy sectorsExplore possibility of acquiring energy assets abroadClarity and stability in policy to attract investmentTax Policy should be uniform across sectors with specific differences for externalityRegulation of coal prices to be replaced with market driven price.Coal price to be fully variable based on Gross Calorific value and other quality parametersRational State and Central taxes on commercial energy suppliesEnvironmental taxes and subsidies to affect choices of fuel

Accelerating Power Sector ReformsThe reforms focus on controlling the aggregate technical and commercial (AT&C) losses of the statetransmission and distribution utilities. This is needed to create a financially sound power sector ineach state. Only financially healthy state power distribution utilities can sustain the growinggeneration and transmission of Central Power Sector.Accelerated Power Development and Reform Programme (APDRP) has to be restructured to ensureenergy flow auditing at the distribution transformer level through automated meter reading, aGeographical Information System (GIS) mapping of the network and consumers and the separationof feeders for agricultural pumps.Investment in developing a Management Information System (MIS) that can support a full energyaudit for each distribution transformer is essential for reduction in AT&C losses. This will also fixaccountability and provide a baseline which is an essential prerequisite to management reformand/or privatization.One of the key aspects is rehabilitation of existing thermal stations to raise capacity at least cost as ashort-term measure. Similarly, rehabilitations of hydro stations would yield peak power at lowestcosts.Reduction in Cost of Power1n terms of purchasing power parity, the power tariffs in India for industry, commerce and largehouseholds are among the highest in the world. t is important to reduce the cost of power toimprove both the competitiveness of the Indian economy and also consumer welfare.The following measures are suggested:

o All generation and transmission projects should be competitively built on the basis of tariffbased bidding.o Where t riff continues to be determined on the basis of o s t ~ and norms, regulators mayeither adopt a return on equity approach or return on capital approach, whichever isconsidered better in the interest of consumers.


8/13/2019 bee book 1.2

20/28


8/13/2019 bee book 1.2

21/28


Increasing exploration to find more coal, oil and gas Maintaining a reserve, equivalent to 90 days of oil imports for buffer stock purposes and/orbuy options for emergency supplies from neighbouring large storages such as those availablein Singapore.

Addressing short-term price volatility through creation of buffer stocks. Operating thestrategic/buffer reserves in cooperation with other countries who maintain such reservescould also increase their effectiveness. In-situ coal gasification

Extracting coal bed methane from coal minesAdopting enhanced oil recovery technologiesExtracting isolated deposits of all hydro carbons including coal through private sectorDeveloping the thorium cycle for nuclear powerExploiting non-conventional energy, especially solar power

In addition, India can access cheap natural gas overseas under long-term agreements (i.e. 20-30years) and it can consider setting up captive fertilizer and or gas liquefaction facilities in suchcountries.Role of Nuclear and Hydro PowerThe developments of hydropower, especially storage schemes, are critical for India as our per capitawater storage is the lowest among other comparable countries. Overcoming such deficiencies iscritical to India's water security, flood control and drought control. However, the environmentalconcerns and the problem of resettlement and rehabilitation must be suitably addressed.India is poorly endowed with Uranium. Available Uranium can meet needs of only up to 10000 MWof nuclear power. Uranium ore is of low grade containing only up to 0.1% Uranium compared with12-14% Uranium in resources abroad. Hence, our nuclear power is 2-3 times costlier thaninternational supplies.Three stage strategy of development of nuclear power from pressurized heavy water reactor to fastbreed reactor and finally to Thorium based reactors is being planned.Promoting and focusing energy related R DNational Energy Fund is being planned to finance energy R&D on a competitive basis as it is feltthat energy related R&D is not being allocated the resources that it needs. Such R&D would help inraising energy security and delivering energy independence over long-term. t is also proposed todevelop number of research institutions as centres of excellence in energy research.A number of technology missions should be mounted for developing near commercial technologiesand rolling out new technologies in a time bound manner. These include coal technologies forefficiency improvement; in-situ gasification, IGCC and carbon sequestration, solar technologiescovering solar thermal and photovoltaic, bio-fuels such as bio-diesel and ethanol, bio-massplantation and wood gasification, and community based bio-gas plants.


8/13/2019 bee book 1.2

22/28


Climate Change ConcernsConcern and the threat of climate change has been n important issue in formulating the energypolicy. Initiatives suggested to reduce the green house gas intensity of the economy by as much asone third are:

Energy efficiency in all sectors Emphasis on mass transport Active policy on renewable energy including bio-fuels and fuel plantations Accelerated development of nuclear and hydro-electricity Technology missions for clean coal technologies Focused R D on many climate friendly technologies

2.6 National Action Plan on Climate Change NAPCC)India is faced with the challenge of sustaining its rapid economic growth while dealing with theglobal threat of climate change. This threat comes from accumulated man-made greenhouse gasemission in the atmosphere generated through long term, intensive industrial growth and highconsumption lifestyle. India is very vulnerable to climate: floods, droughts, vector borne disease,cyclones, ocean storm surges, etc.Climate change may alter the distribution and quality of India's natural resources and harm thelivelihood of its people. With an economy closely linked to its natural resources base and climatesensitive sector such as agriculture, water forestry, India may face a major threat because ofclimatic change.India needs a national strategy to firstly, adapt to climate change and secondly to improve theecological sustainability of India's development path. NAPCC document was released in 2008 and itidentifies measures to advance India's development without affecting climate change relatedadaptation and mitigation.Guiding Principles o NAPCC

Protecting the poor and vulnerable sections of the society through sustainable developmentstrategy sensitive to climate change. Achieving national growth objectives, while enhancing ecological sustainability leading tomitigation of greenhouse gas emissions. Devising efficient and cost-effective strategies for Demand Side Management. Deploying appropriate technologies for both adaptation and mitigation of greenhouse gasesemissions extensively as well as rapidly. Engineering new and innovative forms of market, regulatory and voluntary mechanisms topromote sustainable development. Effecting implementation of programmes and projects through local government institutionsand public private partnership.

Bureau ofEnergy Efficiency 48

8/13/2019 bee book 1.2

23/28


Eight National MissionsThere are eight National missions which form the core of the National Action Plan. They are:

National Solar Mission National Mission for Enhanced Energy Efficiency National Mission on Sustainable Habitat National Water Mission National Mission for Sustaining the Himalayan Ecosystem National Mission for Green India National Mission for Sustainable Agriculture National Mission for Strategic Knowledge on Climatic Change

National Solar Mission: India is a tropical country, where sunshine hours are long and with highintensity. Solar Energy, therefore, has great potential as future energy source. At present efficiencylevels, 1 of land area is sufficient to meet electricity needs of India t ll 2031. It also has theadvantage of permitting a decentralized distribution of energy, thereby empowering people at thegrassroots level. There is need to create affordable and more convenient solar power systems andenable storage of solar power for sustained long term use.A National Solar Mission is being launched to significantly increase the share of solar energy in thetotal energy m x as well as to increase the use of other renewable and non-fossil fuel options such asnuclear energy, wind energy and biomass.National Mission for Enhanced Energy Efficiency: The Energy Conservation Act of 2001provides a legal mandate for the implementation of the energy efficiency measures through theinstitutional mechanism of Bureau of Energy Efficiency BEE) in the Central Government anddesignated agencies in each state. A number of schemes and programmes have been initiated and itis anticipated that these would result in saving of 10,000 MW by the end of th Five Year Plan in2012.To enhance energy efficiency four new initiatives will be put in place. These are:

A market based mechanism to enhance cost effectiveness of improvements in energyefficiency in energy intensive large industries and facilities, through certification of energysavings that could be traded. Accelerating the shift to energy efficient appliances in designated sectors through innovativemeasures to m ke the products more affordable. Creation of mechanisms that would help finance the demand side management programmesin all sectors by capturing future energy savings. Developing fiscal instruments to promote energy efficiency.

National Mission on Sustainable Habitat A National Mission on Sustainable Habitat is planned tomake habitat sustainable through improvements in energy efficiency of buildings, management of


8/13/2019 bee book 1.2

24/28


8/13/2019 bee book 1.2

25/28


8/13/2019 bee book 1.2

26/28

2. Energy Conservation Act-2001 ndRelated Policies

QUESTIONSObjective Type Question

1 The legal framework for energy efficiency n India is given bya) Electricity Act 2003 b) Energy Conservation Act 2001c) Electricity (supply) Act 1958 d) Indian Electricity Act 19102 The first amendment to the Energy Conservation Act was made ina) 1948 b 2003 c) 2007 d)2010

3 The nodal agency at the centre for implementing the EC act isa CEA b SDA c) BEE d) Ministry of Power

4 The minimum connected load for a building as defined n the amended EC act isa) 100kW b) 100kVA c 500kW d) 500kVAAs per EC act, the definition of energy audit does not considera) monitoring b) verification c) analysis d) duration of audit

6 Star rating is a part of programme of BEEa DSM b BLY c) S L d) none of the above7 For the purpose of calculating MTOE for a designated consumer the calorific value ofoil is taken asa) 10,500 kCa1/kg b) 10,000 kCa1/kg c) 10,400 kCa1/kg d) 9,800 kCa1/kg

8 The norms for energy consumption in ECBC is defined as energy consumption pera) day b) hour c) square foot d) square meter9 DSM is of benefit toa) Government b) DISCOM c) user d) all of the above

10 The major portion of subsidy under BLY is met be revenues froma) electricity boards b) CDM c)DISCOMS d) central budget

Short Type QuestionsS-1 Explain what is meant by Renewable Purchase Obligation (RPO)S-2 Explain the reforms in the distribution brought about by Electricity Act 2003S-3 Explain the difference between Standards and Labeling?S-4 List at least five national missions under the National Action Plan on Climatic ChangeS-5 Distinguish between designated agency and designated consumer

Long Type QuestionsL-1 Explain the 'Bachat Lamp Yojana' schemeL-2 Explain five important features of the Energy Conservation Act, 2001?


8/13/2019 bee book 1.2

27/28

2. Energy Conservation Act-2001 and Rehlted Policies

REFEREN ES

1 National ction Plan on Climate Change prepared by Prime Minister s Council on ClimateChange2 Integrated Energy Policy Report o he Expert Committee (August 2006) prepared by PlanningCommission, New Delhi

http://www.bee-india.nic.in/http://www .energymanagertraining.com


8/13/2019 bee book 1.2

28/28

bee book 1.2

Documents