Perform, Achieve & Trade (PAT) Bureau of Energy Efficiency

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1 Perform, Achieve & Trade (PAT) Bureau of Energy Efficiency

2 Sectoral Energy Consumption v/s Contribution to the country s GDP Sector % Energy Consumption % Contribution to GDP Industry Agri, AH & Fisheries 7 19 Commercial & Services Household & Others 10 - Source : Energy Conservation Guide, PCRA

3 Energy Scenario in Industrial Sector The energy intensity i.e. energy consumed per unit of GDP for industrial sector has declined by about 1.5% per annum during to although the ratio of energy intensity in industry to agriculture & service sector hovers around Particulars Industry GDP (in Rs. Crore) 468, , , , ,882 Commercial energy consumption in Industry (in mtoe) Energy Intensity of industry sector (mtoe per Billion Rs. GDP) Ratio energy intensity: industry vs. agriculture and service sector Note: GDP at factor cost at constant ( ) prices (in Rs. Crore) Source: Green rating Project, 2009, Centre for Science and Environment, New Delhi

4 Reasons for Change in Energy Usage Pattern Increase Competitiveness -Change in Technology -Retrofit Options -- In-House R&D --Adoption of EE Techniques --Fuel Shift Regulatory Compulsion -EC Act Energy Audits -- Separate EC Cell Increase Awareness About EC -More Publicity thru various media -Concept of CB options -- NECA --Rigorous Activities by various agencies

5 PAT Scheme : Background & Scope (1) Covers 477 designated consumers in 8 sectors All DCs consume about 164 mtoe energy Targets would be given to all DCs to achieve the same within a time frame Achievement > Target E-Scerts Achievement < Target Purchase E-Scerts / Penalty National Target = 6.6 mtoe at the end of 1st PAT Cycle ( April 2011 March 2014)

6 PAT Scheme : Background & Scope (2) Large band-with in Specific Energy Consumption (As per the BEE sectoral Study) Energy Usage Pattern is varying extremely due to various diversities Hence, the targets would be Plant Specific

7 PAT Scheme : Approach Towards Target Setting Sectoral Target will be on pro-rata basis of energy consumption among 8 sectors to achieve National Target Establishment of Baseline : (Example) As per reported data of last 5 years ( to ) Normalization Factor (capacity utilization) Arithmetic Average of last 3 years value Targets to be statistically calculated based on relative SEC approach after grouping the DCs suitably (Example) Estimated targets to be justified by the saving potential available Baseline Energy Audits The target to be reviewed by an expert committee before notification

Status : PAT Scheme 5 years data from 563 DCs collected though the notified format Data compilation & Analysis in Progress Baseline Energy Audit to kick-off from Feb 2011 by CEAs PAT Consultation

8 Status : PAT Scheme 5 years data from 563 DCs collected though the notified format Data compilation & Analysis in Progress Baseline Energy Audit to kick-off from Feb 2011 by CEAs PAT Consultation Document is under review 4 stakeholder workshops conducted at Delhi, Mumbai, Chennai and number of meetings held with different Industry groups Meeting held with various Ministries & Departments Discussion with Industry Associations done The methodology for M&V system, Issuance of E-Scerts & Trading is under design stage

9 PAT Legal Framework Furnish report of energy consumption to the Designated Authority of the State as well as to BEE (section 14(k)). Designate or appoint an Energy Manager who will be in-charge of submission of annual energy consumption returns of the Designated Agencies and BEE (section 14 (l)). Comply with the energy conservation norms and standards prescribed under section 14 (g) of the Act. Purchase Energy Saving Certificates (ESCerts) for compliance to section 14 (g) in the event of default. The Act has been amended with the addition of new sub-section 14A to enable this and section 14A(2) allows such trading. EScerts are defined by adding a new subsection 2(ma). Monitoring and Verification of compliance by Designated Energy Auditors (DENA) which will be prescribed the Government/ BEE under section 14A/13 (p) of the Act. Excess achievement of the target set would entail issuance of ESCerts under section 14A(1). Penalty for non-compliance being Rs. 10 lakhs and the value of non-compliance measured in terms of the market value of tones of oil equivalent by inserting a new section 26(1A). BEE to be the overall regulator and dispute resolution agency and Energy Efficiency Service Ltd. (EESL) to be the process manager.

10 Proposed Methodology for Target Setting (EXAMPLE) ALUMINIUM SECTOR

11 National Target for the Sector Total Energy Consumption by Aluminium sector Total number of DCs in the sector = 2.42 mmtoe = 11 units (6 Smelters + 5 Refineries) Share of industry in total Energy consumption of 8 sectors = 1.01% (2.42 mmtoe of Total consumption) Target Energy Saving by aluminium sector after 1 st cycle of PAT scheme = 0.10 mmtoe (i.e. 1.01% of 10 mmtoe) = 100,000 MTOE

12 Apportionment among Sub-Sectors Total Energy Consumption in Smelter Total number of DCs Total Energy Consumption in Refinery Total number of DCs Pro-rata energy saving target for Smelters Pro-rata energy saving target for Refineries *Note: 1 mmtoe = 1,000,000 MTOE = 1.50 mmtoe (62% of total consumption) = 6 Smelters = 0.92 mmtoe (38% of total consumption) = 5 Refineries = MTOE (62% of 0.10 mmtoe) = MTOE (38% of 0.10 mmtoe)

13 Statistical analysis for Smelter Plant Name Production (in Tonnes) Average productio n (MT) Estimated SEC (in MTOE/ ton) Averag e SEC Relativ e SEC Total Energy consumpti on (in MTOE) Plant#1 3,62,793 3,68,867 3,78,157 3,69, ,71,455 X % Target Plant#2 3,58,954 3,58,734 3,59,213 3,58, ,89, X Plant#3 76,867 2,07,741 2,50,981 1,78, ,49, X To be Energy Saving x x x Plant#4 66,347 73,008 99,406 79, ,13, X x Plant#5 NA NA 37,635 37,635 NA NA , X x Total 13,91, X

14 Calculation for Target Setting Total Saving x MTOE Target Saving MTOE X 4.15 %

15 Statistical analysis for Refinery Plant Name Production (in Tonnes) Average productio n (MT) Estimated SEC (in MTOE/ ton) Averag e SEC Relativ e SEC Total Energy consumptio n (in MTOE) % Target To be Energy Saving Plant#1 3,83,200 3,72,100 3,77,000 3,77, ,073 X x Plant#2 15,78,000 14,63,300 15,59,200 15,33, ,65, X x Plant#3 83,148 NA NA 83, NA NA , X x Plant#4 2,17,270 2,26,765 2,26,881 2,23, , X x Plant#5 7,01,578 7,16,745 NA 7,09, NA ,66, X x Total 9,22,214 0X

16 Calculation for Target Setting Total Saving x MTOE Target Saving MTOE X 3.14 %

17 Final Targets for Smelter & Refinery Plant Name Baseline SEC Target (%) To be SEC To be MTOE Plant# ,51,889 Plan# ,67,806 Plant# ,38,527 Plant# ,08,391 Plant# ,111 Total energy consumption at the end of 3 years (in MTOE) 13,29,725 Total present energy consumption (in MTOE) 13,91,594 Energy saving during the period 61,870 Plant Name Baseline SEC Target (%) To be SEC To be MTOE Plant# ,182 Plant# ,47,771 Plant# ,178 Plant# ,167 Plant# ,53,901 Total energy consumption at the end of 3 years (in MTOE) 8,84,199 Total present energy consumption (in MTOE) 9,22,214 Energy saving during the period 38,014

18 Points for Consultation!!! Estimation of Absolute Energy Saving : Energy Saving = P base year ( SEC base year SEC target year ) Where P = Production Normalization for change in source of electricity Grid Supply to Captive Generation Any other Issues???

19 THANK YOU FOR YOUR KIND ATTENTION

20 Mission Goals Market-based approaches to unlock energy efficiency opportunities, estimated to be about Rs. 74,000 Crores By : Annual fuel savings in excess of 23 million toe Cumulative avoided electricity capacity addition of 19,000 MW CO 2 emission mitigation of 98 million tons per year

21 The PAT Scheme The market based mechanism to enhance the cost effectiveness in improving the Energy Efficiency in Energy Intensive industries through certification of energy saving which can be traded

22 Market Transformation for Energy Efficiency (MTEE) Accelerating the shift to energy efficient appliances in designated sectors through innovative measures to make the products more affordable.

23 Energy Efficiency Financing Platform (EEFP) Creation of mechanisms that would help finance demand side management programmes in all sectors by capturing future energy savings.

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

25 List of DCs Industry Sector Annual Energy Consumption Norm to be DC (mtoe) No. of Identified DCs Aluminum Cement Chlor-Alkali Fertilizer Pulp & Paper Power Iron & Steel Textiles

26 Andhra Pradesh Assam Bihar Chhattisgarh Goa Gujarat Haryana HP Jharkhand Karnataka Kerala M.P Maharashtra Meghalaya New Delhi Orissa Pondichery Punjab Rajasthan Tamilnadu Tripura U.P Uttaranchal West Bengal State-wise DCs ( )

27 Estimated Energy Consumption in DCs Sector MTOE Power (Thermal) Integrated Steel 28.0 Cement Fertilizer 7.86 Textile 1.62 Aluminium 7.73 Paper 2.09 Chlor-Alkali 1.06 TOTAL

28 Target in PAT Target is defined as the % reduction of Specific Energy Consumption (SEC) from Baseline value. All forms of Energy Product E Plant System Boundary P S E C Baseline SEC Target SEC Reduction in SEC SEC = E / P Expressed in % Y1 Y2 Y3

29 Energy Consumption (MToE)Share Among DCs Power (Thermal) Integrated Steel Cement Fertilizer Sponge Iron Textile Aluminium Paper Chlor-Alkali 4% 2% 0.6% 1% 0.18% 6.2% 5.1% 11.65% 69.23%

30 Sectoral studies by BEE on Setting Up of Sectoral Bandwidth for DCs have revealed the impact on SEC due to above diversities Sector Range of SEC Power plant kcal / kwh Fertilizer Gcal/T of Urea Cement Kcal/Kg of Clinker (Thermal) KWH/ T (Elect) Integrated Steel Gcal / tcs Sponge Iron Gcal / T (Thermal) KWH/T (Elect) Aluminium (Smelter) KWH/T Aluminium (Refinery) MKcal / T of Alumina Pulp & Paper GJ/T Textile Kcal/kg (Thermal) KWH/Kg (Elect) Chlor-Alkali kwh/ T of caustic soda

31 Reasons for Large Energy Usage Bandwidth The energy usage pattern varies widely in industries of a particular sector due to various diversities like -Scale of Production (Installed Capacities) - Use of Raw Material - Process Technology - Vintage - O & M Practices - Type of Product Output etc. Factors of Diversity Most Affected Sectors a) Raw Material Input Pulp & Paper, Fertilizer, Power Plant, Textile a) Quality of Raw Material / Fuel All sectors a) Process & Technology Aluminium, Iron & steel, Chlor-Alkali, Paper a) Final Product output Textile, Iron & Steel, Aluminium a) Vintage All Sectors a) Capacity Utililization All sectors

32 Approach for Setting Targets Depends upon the Objective of the Scheme Total Saving Objective = 6.6 mmtoe Sector No of DCs Energy Reduction Nos Million TOE Aluminium Cement Chlor Alkali Fertilizer Iron & Steel Pulp & Paper Textile Thermal Power Plant TOTAL

33 Example : Baseline Estimation Name of Unit ABC Ltd. Place XYZ Total Installed Capacity TPD Sector : Cement Particulars Unit Installed Capacity Tonnes Actual Production (Cement) Tonnes Capacity Utilization % Average in last 3 yreas % Deviation from Average in last 3 yras % Total Energy Input Million Kcal Total Energy Consumption MTOE Gate-to-Gate SEC w.r.t. cement Kcal/kg Base Year Average Capacity Utilization % Base line SEC (Gate-to-Gate) kcal/kg 789

34 Example : Target Setting (1) Plant Name Production (in Tonnes) Average production (MT) Estimated SEC (in MTOE/ ton) Average SEC Relative SEC Total Energy consumpti on (in MTOE) % Target To be Energy Saving Plant1 3,62,793 3,68,867 3,78,157 3,69, ,71,455 X x Plant2 3,58,954 3,58,734 3,59,213 3,58, ,89, X x Plant3 76,867 2,07,741 2,50,981 1,78, ,49, X x Plant4 66,347 73,008 99,406 79, ,13, X x Plant5 NA NA 37,635 37,635 NA NA , X x Total 13,91, X

35 Example : Target Setting (2) Total Saving x MTOE Target Saving MTOE X 4.15 % Plant Name Baseline SEC Target (%) To be SEC To be MTOE Plan ,51,889 Plan ,67,806 Plant ,38,527 Plant ,08,391 Plant ,111 Total energy consumption at the end of 3 years (in MTOE) 13,29,725 Total present energy consumption (in MTOE) 13,91,594 Energy saving during the period 61,870

36 Baseline SEC Baseline SEC Number of Clusters depend upon the Bandwidth of Baseline SEC Plant 1 Plant 2 Plant 3 Plant 4 Plant 5 Plant 6 Plant 7 Plant 8 Plant 9 Plant 10 Plant Cluster 2 Cluster 1 Plant 1 Plant 9 Plant 4 Plant 3 Plant 6 Plant 10 Plant 8 Plant 2 Plant 7 Plant 5 Plant Cluster 3

37 THE PAT SCHEME.. Approach INDUSTRY (DC) Review of Present Energy Scenario & Bandwidth (Completed) Establish Baseline Development of Baseline Formats with System Boundaries Data Collection, Compilation & Analysis Verification of Data Set Targets for SEC Reduction Achieve the Target Technology Transfer, EE Technology, R&M, R&D Verification Protocol Trade the higher achieved saving through E-Certs

38 Activity Flow Sheet Baseline & Target Setting Designated Consumer Baseline Format Design Finanalization of DC List Getting Information Through Base Line Format Prepare PAT Assessment Document (PAD) BEE Issue of e-certs after successful M&V Getting information through Form#1 Data Compilation/ Evaluation Verification of PAD through DENA Recommendation for e-certification Target Setting [Declaration of Base Year, Target Year ] Validation of PAD through DENA

39 Target Setting for Power Station Variation in Net Station Heat Rate from Design Net Heat Rate Reduction Target for % deviation in the Net Station Heat Rate % Reduction Target in Net Station Heat Rate Upto 5% 10% 0.5 More than 5% and upto 10% 15% 0.75 to 1.5 More than 10% and upto 20% 20% 2.0 to 4.0 More than 20% 25% 5 and above

Facts of PAT Cycle 1 & 2. A Bicon Consultants Report. Bicon Report 12/30/16 Energy Knowledge Hub

Facts of PAT Cycle 1 & 2. A Bicon Consultants Report. Bicon Report 12/30/16 Energy Knowledge Hub Facts of PAT Cycle 1 & 2 A Bicon Consultants Report Bicon Report 12/30/16 Energy Knowledge Hub About Bicon Consultants: bicon Bicon Consultants is a Chartered Engineering firm, accredited by BEE as an