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The National Mission on Enhanced Energy Efficiency will be implemented from April 1, 2010. While making the announcement, power minister Sushilkumar Shinde said enhancing energy efficiency is a quick and effective way to mitigate climate change.The Prime Minister’s Council on Climate Change has already approved the implementation plan for the mission prepared by ministry of power and the bureau of energy efficiency.

Shinde added that the mission would seek to create an energy efficiency market worth an estimated Rs 74,000 crore. Its implementation over the next five years is estimated to result in an annual fuel saving of about 23 million tonne (mt) of oil and avoid capacity addition of over 19,000 mw, leading to carbon dioxide emission reduction of 98.55 mt annually.

The perform achieve and trade initiative is the flagship of the mission, which is a market-based mechanism to enhance cost effectiveness in energy efficiency in energy-intensive large industries and facilities through certification of energy savings that could be traded.

Energy efficiency improvement targets will be set under Section 14 of the Energy Conservation Act, 2001. Industries that achieve savings in excess of their target will earn energy saving certificates, which they can sell to underperformers.

Shinde also announced that the mission would institute two innovative fiscal instruments. While the Partial Risk Guarantee Fund will provide commercial banks with partial coverage of risk exposure against loans made for energy efficiency projects, the Venture Capital Fund for Energy Efficiency would ease a significant barrier from the viewpoint of risk capital availability to the ESCOs, who invest in the supply of energy efficient goods and services.

A new organisation — Energy Efficiency Services Ltd — has been already created and incorporated as a joint venture of NTPC, PFC, REC and PowerGrid to facilitate implementation of energy efficiency projects. EESL will work as ESCO; as consultancy organisation for CDM, energy efficiency; and as a resource centre for capacity building of utilities, financial institutions etc.


Source- Financial Express