With a nationwide rollout of a new scheme stipulating energy efficiency target for industry on the anvil, the Government is taking a leaf out of the British experience with implementing a similar mechanism for industrial users.

The Power Minister, Mr Sushilkumar Shinde, who met the visiting Minister of State for Energy and Climate Change of the UK, Mr Greg Barker, on Thursday, discussed the issue of efficiency targets and considered specific areas where bilateral collaboration is possible.

The two sides discussed institutional structure and best practices from the UK and EU schemes, relevant to the proposed mechanism in India, including on how schemes may be expanded over time, an official statement issued after the meeting said.

The development of an appropriate upfront pricing mechanism to bring out the price of energy savings certificates was also deliberated by both the sides.

Also, exploration of the potential of a partial risk credit guarantee fund for energy efficiency, to help “kick start the market” for energy efficiency investment also figured in the talks, it said.

PAT proposal

The Government plans to come out with sector-wise energy efficiency and unit-wise consumption targets for nine notified sectors early next year. Under the new Perform, Achieve and Trade (PAT) proposal, over 700 industrial units across selected sectors nationwide, will be given targets for reducing their energy consumption.

Those managing to better their targets will be allowed to sell energy saving credits to those failing to achieve the required cuts.

UK experience

In the UK, the Energy Efficiency Commitment (2002-2005) scheme required all electricity and gas suppliers with 15,000 or more domestic customers to achieve a combined energy saving of 62 TWh (terawatt hours or a billion kWh/units) by 2005 by assisting their customers to take energy-efficiency measures in their homes.