Energy consumption in India is low. Installed Indian Capacity 1,45000 MW (approx.) Peak Load Electricity Supply Shortage 15%

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3 Energy consumption in India is low Indian Per capita energy consumption is 530 kgoe while world average is 1770 Per capita electricity consumption is kwh against world average of 2500 kwh Installed Indian Capacity 1,45000 MW (approx.) Peak Load Electricity Supply Shortage 15% Base Load Supply Shortage 9% Energy demand is increasing due to rising incomes, accelerated industrialization, urbanization and population growth : 572 Mtoe : Mtoe

4 Per Capita Consumption of Electricity in India Growth Pattern Source: CEA As per UN Methodology (Gross Electrical Energy Availability / Population) (Projected)

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6 Bureau of Energy Efficiency Established in 2002, under the Energy Conservation Act, Improve energy efficiency through various regulatory and promotional instruments Plan, manage and implement provisions the EC Act Appliance standards and labeling Industrial energy benchmarks Energy Conservation Building Codes Monitor energy use in high energy- consumption units Certify and accredit energy auditors and energy managers Provide a policy framework and direction to national energy conservation activities Disseminate information and knowledge, and facilitate pilot and demonstration projects Establish EE delivery systems through Public- Private Partnerships (PPP). 6

7 Barriers of Energy Efficiency Higher upfront cost of energy- efficient technologies Lack of Information about comparative energy use especially of appliances bought by retail consumers Inadequate awareness about the benefits of energy conservation & efficiency Lack of Innovative financial instruments

8 BEE is established to implement & monitor the Energy Conservation Act, The Act empowers Bureau and Central Government to specify Energy Consumption Standards. The Standards and Labeling is a direct outcome of section 14 clause (a)-(d) of the Energy Conservation Act,2001. BEE had launched S&L Scheme as voluntary basis under National Energy Labeling Programme on 18th May 2006, covering Eleven Products phase wise. EC act can Prohibit manufacturers for sale or import of equipments and appliances that do not meet standards. Require display of Energy performance labels on equipments and appliances. 8

9 EC Act 2001/Chapter V Power of Central Govt. to Facilitate & Enforcement Efficient Use Of Energy & Its Conservation Clause (14) ((a)to (d)) The Central Government may, by notification, in consultation with the Bureau- The Bureau shall recommend to the Central Government the norms for processes and energy consumption standards required to be notified under clause (a) of section 14. And recommend to the Central Government the particulars required to be displayed on label on equipment or on appliances and manner of their display under clause (d) of section 14. 9

10 1.5 Sample Labels 10

11 Products covered under Indian S&L Program Current List 1. Frost-free Refrigerators 2. Tubular Fluorescent Lamps (TFL) 3. Air-conditioners 4. Direct cool /Frost Free Refrigerators 5. Distribution Transformers 6. Motors 7. Pump sets 8. Ceiling fans 9. LPG Stoves 10. Colour TVs 11. Storage Water Geysers Launched on 18 th May 2006, for 4 products by BEE

12 Home Appliances Washing Machines Electronic Ballast Computer Monitors Kerosene Stoves Consumer Electronics Microwave ovens Industrial Equipments Industrial Fans & Blowers Diesel Generating sets Boilers Compressors Uninterrupted Power Supply (UPS) External Power Supplies (EPS) Battery Chargers (BCs) Standby Power equipments Refrigerator &AC Systems Adaptive Defrost Commercial Freezers Visi Coolers Chocolate Coolers Chest Coolers Heat Pumps Passenger Cars. 12

13 Domestic and agricultural Consumers Commercial consumers Institutional and Government Purchases Industrial Users Electricity Generating, Transmitting, and Distributing companies 13

14 Regulation: Policies & its framework Standards & Labels to be made mandatory at appropriate time Energy Efficiency Supply Push Design & technology developments Align with international trends Handholding of some segments of manufacturers Demand Pull Awareness & dissemination Demand for the EE products 14

15 Ins$tu$onal frame work for regula$on BIS National Standards Body Formulation & Implementation of National Standards Production certification, Quality system certification, EMS certification etc. Bureau of Energy Efficiency (BEE) BEE is established to implement & monitor the Energy Conservation Act, 2001 One of the key thrust areas of EC Act, 2001 is Standards & Labeling Programme Formulation of Energy Efficiency Standards. 15

16 1.Rapid Growth of Energy is predicted 2.Significant Variations in Energy Efficiency of Different Units 3.Energy Efficient Technology Exists but not being used in Most of the products 16

17 Targeted cumula$ve savings during the year and

18 Reduc$on in genera$on capacity obtained as a result of energy efficiency interven$ons during the financial year BU in and 6.5 BU during is saved 18

19 Market Transforma$on: Non star 1 star 2 star 3 star 4 star 5 star Total Refrigerators % share Units 1,616,824-24, ,301 2,498, ,541 5,500,000 ACs % share Units 349, , , , ,316 89,856 2,500,000 19

20 Programme Electricity Saved (MUs) Equivalent million MTOE Avoided Thermal Capacity (MW) Total Fuel Saved (mtoe) Standards and Labeling (07-08) Standards and Labeling(08-09)

21 Importance of star labeling Meaning of star labeling % Star labeling is useful for saving electricity 52 It saves energy 20 More star saves more power 19 Good quality product 13 It has more advance technology 5 It depends upon the number of stars in it 3 They told about power saving with star level products 3

22 Policy interventions Designated consumers, which are basically energy intensive industry, commercial buildings and establishments. Energy consumption standards and labeling program for equipment and appliances. Mandating of Energy Efficient equipments in Government Purchases. Making voluntary schemes for market transformation towards energy efficiency and mandating them later on. Creating compliance of energy efficiency policies through monitoring and verification.

23 Background/ Opportunities The basic tenet of the mission is to ensure a sustainable growth by an appropriate mix of 4 E s namely- Energy, Efficiency, Equity and Environment. Promote development objectives, while also yielding co- benefits for addressing climate change effects.- Cost- effective energy efficiency and energy conservation measures Potential to reduce energy consumption by Demand Side Management (DSM) of 15-25% (IEP: 2006) Market based approach to implementation of energy efficiency market size of Rs. 14,000 crores estimated 23

24 Rural Electrification and Pump sets Electrified ( as of Feb, 2009) 24

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26 Overview of India s Agriculture Sector India s agriculture sector consumes 22% of total electricity, up from 10% during the 1970 s The agricultural tariff has not grown while average cost of supply of utilities is increasing at a fast pace Free & flat HP based tariff plan for agriculture has been one of the factors contributing to inefficiencies and thereby high AT&C losses of the State Utilities Slide 26

27 Equipment Annual electricity consumptio n of equipment GWh [1] Annual sales of equipm ent in millions Annual electricit y consum ption of new stock GWh [2] Electrici ty consum ption of new stock to total electrici ty % [3] Estimat ed improve ment in efficienc y of new stock % [4] Annu al electr icity savin gs GWh [5] Organi sed sector [6] % Infor mal secto r [7] % (1) (2) (3) (4) (5) (6) (7) (8) (9) Agricultural pump sets [8] 84, , , [8] Sample calculation for agricultural pump sets is given below. Similar estimates were made for other equipment. Column 4 = Annual electricity consumption of new stock = column 3 * 1500 hours per year * average 5 kwh consumption per hour = 6000 GWh Column 5 = Electricity consumption of new stock to total electricity = Column 4/ *100 = 1.1% Column 6= Estimated improvement in efficiency of new stock = 5kW pump replaced by 3.1 kw high efficiency pump delivering the same quantity of water = 100* (5-3.1)/5 = 38% Column 7 = Annual electricity savings = Column 4* column 6/100 = 2280 GWh

28 Sl. No. Product detail Electrical pumps Range kw No. of Poles Applicable IS 1. 3 Phase open well submersible pump sets 1.1kW, 1.5kW, 2.2 kw, 3.0kW, 3.7 kw & 5.5 kw, 7.5kW, 9.3kW, 11kW, 15kW 2 Pole IS 14220: Phase submersible pump sets 1.1kW, 1.5kW, 2.2 kw, 3.0kW, 3.7 kw & 5.5 kw, 7.5kW, 9.3kW, 11kW, 15kW 2 Pole IS 8034: Phase Mono-set pumps 0.37kW, 0.75kW, 1.1kW, 1.5kW, 2.2 kw, 3.0kW, 3.7 kw & 5.5 kw, 7.5kW, 9.3kW, 11kW, 15kW 2 Pole IS 9079:2002

29 Star Rating Overall Efficiency of the Pump Set* (multiplying factor times the BIS value) 1 Star >=1.00 & < Star >=1.05 & < Star >=1.10 & < Star >=1.15 & < Star >=1.20 *Overall efficiency of the pump set is including the efficiency factor for induction motors. The overall efficiency is calculated as per IS 14220:1998, IS 8340:2002 and IS 9079: 2002 for pump sets and IS 12615: 2004, IS: , IS 325: 1996 for induction motors.

30 Opportunity / PotenDal in Ag DSM DSM in Agriculture provides immense opportunity in Reducing the overall power consumption Improving efficiencies of ground water extraction Reducing the subsidy burden of the states without sacrificing the service obligation to the sector Most of the pilot projects as well as other studies project potential of 45-50% by mere replacement of inefficient pumps Overall electricity savings (from 20 million pumps) is estimated at 62.1 billion units annually Slide 30

31 ObjecDves of the Scheme To create appropriate framework for market based interventions in agricultural pumping sector through Public Private Partnership (PPP) mode Intended Outcomes of Programme Shelf of bankable DPRs (one in each State) to stimulate the market Business model through ESCO mode Baseline development, conducive regulatory regime and security mechanism Awareness and outreach to the local farmers and utility employees Risk Mitigation Measures to encourage PPP CDM benefits for the scheme Slide 31

32 Steps Involved Selection of States To rank states for implementation of Ag- DSM based on Framework developed Attributes to rank the states Connected load, percentage consumption by agricultural sector, status of feeder separation, AT&C Losses, Power sector performance rating by PFC Selection of Feeders for DPR preparation To identify eligible feeders for DPR preparation Criteria for feeder selection Slide 32 No of connected pump sets, HVDS implementation, Dependability on ground water extraction, measurable baseline 12

33 Steps Involved Engagement of Consultants for DPR preparation DPR to be prepared to estimate energy saving potential along with clear baseline Organization of workshops and Seminars Awareness generation and capacity building for utility employees and farmers Develop a model for Project Implementation Identify risk mitigation measures and ring fencing of risks in Ag DSM projects Engagement of ESCO/Discom for implementation of DPR Slide 33 Replacement of existing pump sets with energy efficient ones 13

34 Business Model for AgDSM project (ESCO mode) Consumers Sale of saved energy to other consumers Government / Regulatory Commission Reduction in Subsidy payments Policy Guidelines and Approvals Inclusion in Annual Revenue Requirement Farmer Free Energy Efficient Pump set Reduced Energy Bills Free Maintenance Quality Power Supply Electricity sales Pump Utility / Discom Improved power delivery (Reliability & Quality) Improved Collection efficiency Reduced Losses and Peak Load Subsidy Reduction due to saved energy Policy guidelines & Approvals ESCO Payment Security Package Design / Installation / Commissioning & O&M Capital for Installation of new pumps Demonstrate the energy savings Payment on Shared saving model Repair and Maintenance Monitoring Agency Third Party Testing Agreement

35 Risks in Ag DSM Project Risks factors outside the ESCO s control Farmer behaviour Amount of land under irrigation Cropping patterns Water table declines Weather and rainfall These factors cause energy loads to vary, even if the technical performance of the ESCO s installed systems perform as specified Variation in power quality affect pump performance, useful life and maintenance and replacement costs ESCOs and their lenders may not be able to accept full exposure to such uncontrollable risks Slide 35

36 Deemed Savings Approach From the point of view of ESCO and its lender, a stipulated savings protocol (Deemed Savings Approach) may be appropriate Demonstration of performance (measure input power) of a sample of pump sets before and after the project in order to estimate savings for each category and size of pump set This information would then be used to stipulate savings for the entire project area based on fixed hours of operation of pump sets (around 1600) Periodic demonstration of pump set efficiencies during the course of the contract period Even if Deemed savings approach is used to determine payments to the ESCO, the Discom can implement measured savings approach (Monitoring and Verification) for all the feeders to gather the most accurate savings Slide 36

37 Benefits to different Stakeholders DISCOM Reduction in technical and commercial loss levels Increase in reliability of the power supply Improved power supply quality Supply to more number of consumers without increase in the demand 50 % subsidy for HVDS implementation (Part B) under R-APDRP once AT&C loss level of 15 % is achieved Additional CDM benefits could be availed for HVDS FARMERS Free of cost BEE Star labeled pump set will be provided Negligible maintenance cost during the warranty period Reduction in monthly energy bills due to 30 % of energy saved Power supply with better quality and less time for same water discharge Availability of trained local specialists to handle maintenance and repair of energy efficient pump sets STATE GOVERNMENT Mitigation of Demand Supply Gap Sustainable Development Reduced Energy Intensity per GDP Additional investment in new power plants could be avoided Reduction in subsidy to Discom Slide 37

38 Roles and responsibilides of different Stakeholders DISCOM Ensure quality of supply Finance, implement and by Implementing HVDS operating the project Ensure necessary Procure, install, and metering arrangements provide repair and (electronic meters on maintenance transformers) Demonstrate efficiency Sign a contract with ESCO Payments on a monthly improvement sets of pump basis to ESCO based on Training of local specialist the formula derived from competitive bidding in repair and maintenance of star labeled pump sets ESCROW account as a payment security mechanism ESCO BEE Organize brain storming session Develop financial model Prepare documents with projects contract associated Prepare M & V protocol Float RFP for engagement of ESCO Bid process management Monitor the progress of project implementation Slide 38

39 Current Status of the Programme Based on a framework, 5 states namely Maharashtra, Gujarat, Rajasthan, Haryana and Punjab were selected for implementation of Agricultural DSM in initial phase of the programme Energy audit of all the pumps have estimated the savings by replacing the inefficient pumps with star labeled energy efficient pumps. Expression of Interest (EoI) for engagement of energy auditors to prepare DPR for remaining 4 states namely Rajasthan, Gujarat, Haryana and Punjab have been floated BEE has labelled the agriculture pump sets BEE has accredited 35 ESCOs through an accreditation process carried out by CRISIL and ICRA Slide 39

40 Benefits of usage of 5 star Pumps An Example: HP/KW Stage Head D/Charge (LPM) Overall Efficiency (%) Unit = Input K.W. X Hour Over All Eff. = (H X Q/6120) / Input K.W. 5 STAR RATED PUMPS: ISI PUMPS : 58.7 = (125 X 536 / 6120) /Input k.w. 48 = (125 X 536/6120) / Input k.w. Input k.w. = k.w.(max.) Input k.w. = 22.8 Unit Consum. with in 8 Hr. = X 8 = Unit Unit Consum. within 8 Hr.= 22.8X8 = Unit For 300 Days = X 300 = Unit Unit For 300 Days = X 300 = Yearly Pay = X 5.5 = Yearly Pay = X 5.5 = Saving = Rs Every Year ISI Efficiency (%) 20/

41 Cost Benefit Analysis for Pump sets replacement Particulars Based on Avg. Tariff Monetary savings per annum (Rs. Lakhs) 221 Reduction in MSEDCL's revenue from Agricultural Consumers collection efficiency of 60%) Repair & Maintenance Cost of capital) (Rs Lakh) 36 Net benefit to MSEDCL per annum (Rs. Lakhs) 146 Actual Pump Cost Including 12.5 % (Rs. Lakh) 401 Dismantling & Installation Cost (Rs Lakh) 9.8 Cost of Foot Valve Replacement (Rs Lakh) 7 Efficiency Testing Pre & Post Installation (5 % Sample) 2 GI Pipe & bend Replacement (Rs Lakh) 12 Total investment (Rs. Lakhs) 432 Simple payback period (years) 3 39 Slide 41

42 Issues of Concerns in the labeling Program The market is dominated by Submersible pump set ( 70%), mono block(20%) and balance open well ( 10%) The commonly use ratings are HP, Head range of m and Discharge of LPM. Star labeled pump set are available in 2-25 HP and head of m. BIS not available for Higher capacity of Pump sets. Non- availabity of the standard may hamper the Agri- DSM Program. Proposal to develop the labeling program for Pumpsets for higher ratings. Request for labeling of Pump sets in all ratings and all discharge. Slide 42

43 Contact information: Sandeep Garg Bureau of Energy Efficiency (Ministry of Power, Govt. of India) 4th Floor, Sewa Bhawan R.K.Puram New Delhi