energy efficiency opportunities in india

8/20/2019 Energy Efficiency Opportunities in India

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The Indian Energy Efficiency Market

Opportunities and Strategies for AustralianCompanies


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Australia Unlimited

INDIA – a major global economy

US$ 1.7Trillion

economy

11th largestglobal

economy,poised to be

the 3rd largestby 2030

Australia’s 3rd largest and

fastestgrowing trade

partner

Home to anumber of the

world’sleading

corporates

Rapidlyexpandingdomestic

market of 1.2billion people


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Clean Tech Market Snapshot

The Indian market for Low Carbon & Environmental Goods & Services over

the next decade is valued at US $310 billion (UKTI 2011)

World’s fourth largest clean tech opportunity (US, China and Japan) with a

6% share of the global market (EY 2011)

The projected market potential for green building material and technologies

is estimated to be US $100 billion (Green Building Association 2012) In 2012 Energy Efficiency is estimated to be a US$ 16 billion opportunity,

and the Bureau of Energy Efficiency forecasts expenditure of $148 billionthroughout the next decade.

The water and wastewater market was valued at $4 billion in 2011, and is

growing at a rate of 10-12% every year (TERI)

Over 160,000 MT of municipal solid waste is generated daily, driven byrapid urbanisation, with 500m people projected to move from ruralcommunities to cities by 2020.


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Key Market Drivers

Energy security and water scarcity are national priorities Water and waste management challenges due to rapid industrial

growth and urbanization

Abundance of untapped renewable energy resources such as solar,wind, biomass and water

Escalating costs of conventional energy sources with depleting fossilfuel reserves

Supportive government policies

Increased investments by global corporations to reduce climatechange risks and pursue new products/service opportunities

A$ 1 trillion investment in infrastructure - 2012 to 2017


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Sectors with Momentum

Energy Efficiency at plant and building level

Water and waste water management, particularly biological treatment

Smart grid technologies and distributed power generation

Environmental goods and services

Waste management

Green building products and services

Clean coal technologies


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Energy Efficiency - AttractiveBusiness Opportunities in India


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We intend to cover…

► Increasing Investment in Energy Efficiency in India

► Driving Forces for Increasing Energy Efficiency in India

► Market Transformation towards Enhanced Energy Efficiency

Building Sector

Industries

► Business Implications & Opportunities


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Increasing Investment in Energy Efficiency in India

New entry - Indian EE business

► In 2009, Schneider Electric, acquiredBangalore-based Conzerv Systems, anINR 700 million company providing energyefficiency solutions in the Indian market.

No transaction details were disclosed.[1]

► In December 2009, the global energyservices major Dalkia acquires Indianpremier energy services company, DSCLESCO for an undisclosed amount. [2]

► Indian IT giant Wipro invested in energyefficiency and clean tech market by startingWipro Eco-energy.

EE business volume in India

► Century cement India has given ABB anorder worth around USD 18 million toincrease productivity and energy efficiency.[3]

► TERI and Dalkia Energy won contractsfrom SIDBI for providing energy efficiencyadvisory solutions for MSME sector in fiveidentified cluster. Maximum project value ofabout USD 4.5 millions.

Indian energy efficiency market evolved rapidly over the last 5 years due to governmentinitiatives and investment from large players (domestic and global). Few cases are as

below:

[1] http://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/on

[2] http://www.aeee.in/node/44

[3] http://www.abb.com/cawp/seitp202/1e92ba88d982559585257a5900492539.aspx

http://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.aeee.in/node/44http://www.abb.com/cawp/seitp202/1e92ba88d982559585257a5900492539.aspxhttp://www.abb.com/cawp/seitp202/1e92ba88d982559585257a5900492539.aspxhttp://www.aeee.in/node/44http://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/onhttp://www.business-standard.com/india/news/schneider-electric-acquires-conzerv-systems/63762/on


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Climate change – the globalresponse

Driving Forces for Energy

Efficiency in India


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Drivers of Growth of Enhanced Energy Efficiency inIndia

Competitive

Advantage

EnergyDemand

Sustainability

ClimateChange

Regulatory

Driving EnergyEfficiency

Over the last 20 years, primary energyconsumption in India has increased

from 1.02 x 108 MTOE per year to 6.15x 108 MTOE per year

Source: US Energy Information Administration


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Energy Efficiency – Integral to India’s Climate ChangeResponsibilities

Energy Conservation

Act, 2001,Amendment 2010

Electricity Act, 2003

NMEEE (National

Mission onEnhanced EnergyEfficiency)

Building Energy Efficiency Designated Consumers (DC) &

Industries Energy Efficiency Audits & ESCO Labeling of Appliances

Demand Side Management (DSM) Smart Grid Open Access

Perform, Achieve and Trade (PAT) Market Transformation on Energy

Efficiency (MTEE) Financing for Energy Efficiency Power Sector Technology Strategy Low energy design concepts

Energy ConservationBuilding Code

(ECBC)

Minimum energy efficiency standards forcommercial buildings

Encourages energy efficient buildings/retrofit of buildings

Energy performance of buildings Energy efficient construction

Achieve 20-25%reduction of GHGIntensity by 2020

(Voluntary)

EnergyEfficiency

Objective – LowCarbon Growth

Carbon tax

Internal targetunder NAMA andother regulations

National Mission onSustainable Habitat

(NMSH)

Emphasizes the greater use of publictransport and non-motorized modes oftravel.

Sustainable urban infrastructure

National UrbanTransport Policy

2006


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Few Financial Schemes – Strengthening EnergyEfficiency Market in India

SIDBI (Small Industries

Development Bank ofIndia)

MoMSME (Ministry ofSmall Scale Industries)

IREDA (Indian RenewableEnergy Development

Agency) Grants

Petroleum ConservationResearch Association

(PCRA)

Industrial DevelopmentBank of India

(IDBI)

SIDBI and BEE are working as co-implementing agencies for preparing a World-Bank fundedproject titled “Financing energy efficiency at MSMEs”

SIDBI Financial Scheme for energy saving projects in MSME sector under JICA (JapanInternational Corporation Agency) Line of Credit

Scheme for energy savings projects- Nationalized banks

Credit linked capital Subsidy scheme (CLCSS)

Incentives offered by state/ central governments80% depreciation in the first year on the specified energy efficiency equipment andconcessional excise and customs duty on notified energy conservation equipment to promoteenergy efficiency

Concessions/ Rebates and Special Provisions from IREDA

Energy Audit Subsidy Scheme for setting up of Energy Audit Centre/ upgrading energy auditing facilities

Energy Audit Subsidy Scheme Equipment Finance


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Market Transformation towards Energy

Efficiency


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Railway, 2% Public Lighting,

1%

Industry, 46%

Commercial, 8%

Domestic, 21%

Miscellaneous,

2%

Public Water

Works & Sewage

Pumping, 2% Agriculture, 18%

Energy Consumption in India – Sector wise

Industry (46%) is currently thelargest energy consuming sector

Commercial building segmentconsumes around 8% of totalenergy consumption

Potential Energy Savingsin Industrial Sector is

around 6.99%

Potential Energy Savings

of up to 30-50% inIndia’s commercial

sector

EnergySaving

Opportunities

Aggregate Investment Potential in EnergyEfficiency Sector in India amounts to

USD 9.8 Billion (Source: WRI Report, 2008)

Source: BEE, 2009


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Energy Efficient Opportunities in DCsNational Targets of Energy Savings

Opportunities for Energy Savings

► Primary Aluminium - Alumina Refining,Aluminium Smelting

► Secondary Aluminium - Primary heating,Electric Motors, Pumping Systems

Aluminium

Cement Opportunities for Energy Savings► Grid & Power Management

► Power from waste heat recovery

► Use of alternate fuels

Power(Thermal)


► Air and flue gas cycle

► Steam, feed water and condensate cycle

► Fuel and ash cycle

► Electrical & Lighting system

► ECW & ACW System

► Compressed air and HVAC system


► Fuel Switch

► Cogeneration & Renewable energy

► Improved products and services

Fertilizers

Reported energyconsumption (MMTOE)

Apportioned expectedenergy reduction

(MMTOE)

7.73

0.455



(MMTOE)

11.87

0.698



(MMTOE)

101.14

3.10



(MMTOE)

7.86

0.462

Source: BEE, India


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Energy Efficient Opportunities in DCsNational Targets of Energy Savings

Source: BEE, India


► Chemical recovery and cogeneration units► Capacity utilization & technology

► Waste heat recovery facilities

Paper & Pulp

Textile Opportunities for Energy Savings► Spinning

► Weaving

► Wet processing

Chlor-Alkali Opportunities for Energy Savings► Switch from Mercury Cell to

Membrane Cell Technology

► Improved Products and Services


► Smelting reduction

► Top gas recycling blast furnace

► Use of charcoal and waste plastic

► Molten oxide analysis

► Waste energy recovery

► Coke dry quenching

► Advanced wet quenching

Iron & Steel



(MMTOE)

2.09

0.123



(MMTOE)

1.62

0.095



(MMTOE)

0.84

0.049



(MMTOE)

28

1.647


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Energy Efficient Opportunities in Commercial BuildingSector

Lighting Systems & Control

Construction Materials, Building Facades,Paints, Insulation

Heating, Ventilation & Air Conditioning(HVAC)

Building Design & Planning

Energy efficient building managementsystem (eBMS)

Building Energy Audits

OpportunitiesIdentified forEnergy Efficiency

in Buildings

Electrical energy consumption – 46,685 GWh (2007-08)

Source: General Review 2009, Central Electricity Authority

Electrical energy saving potential throughenergy efficiency: 1.92 Billion kWh (2007-08)

Energy Benchmarking

Heating

Ventilation & Air

Conditioning

(HVAC), 55

Lighting, 25

Internal Loads,

15

Others, 5

Energy consumption distribution incommercial buildings, BEE

For Building with electricity demand >500kW.Total Energy Consumption: 9.92 Billion kWh(2007-08)

Source: National Productivity Council (NPC)


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Business Implications of Energy Efficiency in IndianMarket

Energy efficiency has introduced many new businessimplications

► New business challenges – addressing cap and trade

(PAT compliance) costs, calculating value at stake,assessing strategic risks

► New market opportunities – transforming businessprocesses, changing buying patterns for procurement andconsumers – focus on energy efficiency, creating newmarkets and industries through innovation

► New regulatory environment – addressing recent andanticipated regulations and policies, reassessing directors’

responsibilities

► New risks – managing new risks: the threat of climatechange, was ranked as the number 4 business risk in theErnst & Young 2009 business risk report

► New technology – smart grid, cleantech, carbon captureand storage, and others

Energy efficiency is an issue withdirect economic implications that willtransform business

New risksNew regulatory

environment

New marketopportunities

New businesschallenges

Newtechnology

Energy

efficiency

Among sustainability issues, energy efficiency has been driven to the top of the business agenda due to itsimpact on business performance


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Opportunities for Australian Companies in Indian Market

Mapping technology/ solutions offered

by Australian companies against

Indian energy efficiency market

Non-ferrous metals(Aluminium)

Smart Grid

Energy performancecontracting (EPC)

Energy efficiency andenergy management

solutions

Opportunities in Indian energy efficiency market estimated at 148 Billion USD

* Estimated in NMEEE

The Indian energy efficiency market creates significant business andinvestment opportunities for the Australian companies


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Opportunities-Energy Efficiency and Energy Management Solutions

Avenues of energy efficiency

Defining energy reduction goals Developing energy strategy Base-lining, benchmarking, formulation of action

plan Setting appropriate reduction targets Energy audits Energy data analysis Identification, evaluation and development of EE

opportunities, including business case, design,manufacture, implementation, commissioning andmonitoring

Market potential in India

The end use energy efficiency potential in industry and building sector aloneis of the order of INR 100 Billion and INR 20 Billion per year respectively*

Projected market potential for energy efficiency in India reported by differentorganizations like BEE, USAID, WRI, GIZ indicate encouraging growth trendfor energy efficiency

Energy audits in several sectors indicates energy saving potential of 23%-

46% in end uses such as lighting, cooling, ventilation, refrigeration etc

OpportunitiesMajor players in India

Honeywell Emerson Climate Technologies KLG Systel HCL TCS

Accelerating economic development has prompted India’s energy demand to

double by 2030 due to which there is a critical need for energy efficiency The opportunities available in the mid cap segment may be initially explored

by Australian firms because it is fast growing and has limited in-house corecompetence in energy efficiency

Attractive opportunity for Australian companies to participate in state-supported initiatives in India (in programs funded by the Indian Governmentor international funding agencies like UNDP, GEFA, DIFID, JICA, GIZ etc)

* Electricity Demand Side Management (DSM) in India, USAID, India


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Opportunities-Smart Grid

Avenues of energy efficiency

Networking platforms enabling conversion ofelectronic devices into smart devices

Back-end smart-grid management software Home area networking (HAN) devices and

systems Networked solutions for distributed generation and

street lighting

Market potential in India

The market in India today is at a nascent stage. However, it is estimated thatthe country will install 130 Million smart meters by 2021

The current smartgrid market in India is estimated to be 1.1 Billion USDwith a 16.3% CAGR forecast between 2011 and 2015*

Market entry strategyMajor players in India

HCL Infosystems Echeleon Corporation

CISCO General Electric Telvent Siemens IBM Capgemini

Implementation of smart grids projects in India is currently at pilot phase toevaluate best possible frameworks and business models

Though Indian utility companies understand the benefit of smart grid, thepoor financial strength of the DISCOMs and other socio economicalconditions posts challenges in the implementation of smart grid in India

This market segment may be driven in near future through Governmentinitiatives; hence Interested partners for Smart Grid may join India SmartGrid Forum to remain updated about future plans and policy initiatives

*Per market insights cited by CMR India, Energy & Utilities Practice, January 2012 and Global Smart Grid Federation,

October 2011.


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Favoring Growth of Australian Companies in IndianEnergy Efficiency Market…

Population growth andeconomic development in

India will increase thedemand of new technologies

in India

Analysis of Australian company energy efficiency offerings suggests that there is a huge growthopportunity in the Indian market by collaborating with local players/ government in India

Global commitments of energyreduction targets is increasingthe policy intervention in India

Utilities are playing a key rolein deployment of energyefficiency programmes

favoring possibility of tie-upswith the utilities

In India, DCs account for 25%of the GDP and 45% of thecommercial energy. Withincreasing governmentintervention, technology

change would happen at afaster rate driving technology

up gradation

70% of buildings are yet to bedeveloped till 2030 displaying

a crucial need of energyefficient technologies and

products and energy servicecontracts

Energy efficiency- ‘Akey selling point’


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Thank You


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Australia Unlimited

India: Suggested Market Entry Approaches

• Tapping large corporates for niche product offerings in EnergyEfficiency, Environmental management solutions, Waste Water

solutions

• Local manufacturing in a JV - the most appealing way to seize

market opportunities

• Technology Transfer (Licensing) or project specific technology

provider

• Exporting through local distributor- suitable for specific niche

products and services not available locally or available in

insufficient supply

• Targeting Multilateral agencies' (UNDP, IFC, World Bank, ADB)

projects


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Tips on Doing Business in India

• 28 States with different business practices, regulations, opportunities,

languages and culture• India is a highly competitive market

– a priority for leading companies from across the world

• Research and due diligence are critical

– shop around and do your homework before entering into agreements• Know your strengths and focus on key opportunities

– The size and scale of business potential can be overwhelming

• Indian bureaucracy is legendary

– Be prepared for longer time frames for decisions and success

• Relationships are key

– budget for regular travel, training and ongoing business development

– does your potential partner have the right connections to succeed?

• Leverage Austrade’s networks and expertise


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Live Commercial Opportunities from India

Water and waste water:

• Doshion Ltd - seeking technology partnership for water distribution businesscomprising of source intake facility, transmission networks, treatment, technology,distribution, waste treatment, recycle, reuse and Zero Liquid Discharge (ZLD)

Energy efficiency:• Waaree Energies Pvt Ltd - seeking solar technologies such as solar thermal, water

heating, solar water purification and desalination units• Mamata Energy - seeking technology tie-up in solar concentrators, thermal power

generation and hot water systemsEnvironmental management / monitoring and control:• Uniphos Environtronic Pvt Ltd - seeking air quality monitoring systems and water

COD and BOD monitoring systems• Terracon Ecotech Pvt Ltd - seeking consultancy service in the area of ecological and

mining restoration

Waste management:• Shapoorji Pallonji - Seeking technology provider for JV in solid waste treatment forconverting municipal waste to diesel

Vocational training in Cleantech:• Tata Quality Management System - seeking courses in the area of climate change

capacity building for the group companies such as Tata Motors, Tata Steel, TataChemicals etc.


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Successful Australian companies in India


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Austrades’ Market Activities-Potential Lauchpad

Oct 12

• Energy Efficiency workshops in India to potential customers to showcase Australia capability – looking for Australian industry speakers

Oct 12 through to March 2013

• Clean technology, energy efficiency and green building missions to Indiaorganised by State Governments

Nov 12

• Australian Innovation Forum

May 13

• Indian Government mission to Oz Water, Australia


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Indian network

Kylie BellTrade and Investment Commissioner

Malini Dutt

Vijay Kumar

Ramakrishna Dastrala

Jinendra Khara


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Sectoral

opportunities

Contact us for assistance:

Vijay Kumar Austrade, New Delhi (India)T: +91 11 4575 6226E: [email protected]

Malini Dutt Austrade, Mumbai (India)T: +91 22 6116 7133E: [email protected]

Kylie Bell

Austrade, Mumbai (India)T: +91 22 6116 7117E: [email protected]
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]

energy efficiency opportunities in india

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