Energy Efficiency Index: Powering Indian States’ Drive To Reduce Carbon Footprint     

Think energy saving and efficiency, and some of the first things that strike you are power thefts, power wastage, and rattling old appliances that consume loadfuls of electricity, and inflated bills. Slowly and steadily, however, things have been changing across the country. India has been working on energy efficiency since at least 2001, when the Energy Conservation (EC) Act was enacted. This act led to the formation of the Bureau of Energy Efficiency (BEE) at the central level, and the State Designated Agencies (SDA) in the states.

Cut to 2016, India made a commitment to the Paris Agreement in 2016 towards combating climate change, by curbing our carbon footprint and the amount of greenhouse emissions. It has become binding on the country to move ahead swiftly on energy efficiency implementation, and the country’s attainment of goals hinges on states’ implementation of these policies through the SDAs.

A significant development in this area came out in the form of a report early this month - the Alliance for an Energy Efficient Economy’s first ever State Energy Efficiency Preparedness Index, under the leadership of BEE, and along the lines of other state indices that NITI Aayog has created.

Roughly, this index is the number arrived at, when the states’efforts in using energy efficiently in each sector, are first quantified, and then added up. Simple measures like the use of LED street lighting, electric vehicles, energy-efficient appliances, and so on, can reduce consumption of energy. Sixty-three such qualitative and quantitative, outcome-based indicators assess energy efficiency initiatives in states in five sectors – buildings, industry, municipalities, transport, agriculture and distribution companies (DISCOMs).

The index is a weighted score of indicators; the weight allotted to each sector is related to the energy consumption, energy saving potential and states’ influence in the sector. The building sector, for instance, has a higher weight of 30 per cent because it has many indicators, states can be very influential, and it accounts for the second-highest energy use. Industry has the highest energy use, but because states currently do less for energy efficiency in this sector, it gets 25 per cent weight.

It is good to be efficient generally, but it is particularly good to be energy-efficient, because this has ramifications at many levels. A state wise index like this can enable comparisons, show improvement areas, and bring out the best practices for adoption of energy-efficiency measures. For the states, it reduces costs and helps keep track of the state’s energy footprint. When added up, for the country, it helps not just save precious resources like electricity, fuels, etc, thereby helping the economy, but also reduces our carbon footprint and keeps us globally responsible and internationally relevant.

BEE Measures Across India

Among measures outlined by BEE, some have been taken up across the country, like in the buildings sector, most states have implemented UJALA for energy efficient lighting; in industry, BEE’s PAT (Perform, Achieve and Trade) programme - which certifies energy saving and trading in energy-intensive industries - is fairly well implemented. In the municipal sector, most states have utilised EESL’s street lighting national programme and a fair number have signed up for EESL’s Municipal Energy Efficiency Programme for water works and sewerage system retrofits; in Transport, most states track the fuel efficiency of State Road Transport Undertakings (SRTU). The following table gives some examples:

First Ever Energy Efficiency Index: The States’ Scorecard

Most states have implemented programme driven by BEE and (Energy Efficiency Services Limited) EESL, but the ‘front runner’ and ‘achiever’ states have several state initiatives as well. These may include things like: they have notified Energy Conservation Building Code (ECBC); incentives for energy audits in buildings, for implementing energy efficiency in industrial units; municipal energy efficiency programmes; low transmission and distribution (T&D) losses; utility-driven DSM (demand side management) programmes, and so on.

The front runner states in the first edition of the index are Andhra Pradesh, Kerala, Maharashtra, Punjab and Rajasthan in alphabetical order.
The achiever states are Haryana, Gujarat, Karnataka and Tamil Nadu
The third category of Contenders has Madhya Pradesh, Odisha, Telangana, Uttarakhand and Uttar Pradesh.

The aspirant states are Assam, Arunachal Pradesh, Bihar, Chhattisgarh, Jammu and Kashmir, Jharkhand, Himachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura and West Bengal.

What The Frontrunner States Are Doing Right

Kerala

• Kerala was way ahead of the times – it constituted its SDA, the Energy Management Centre, as an autonomous body in 1996, even before the country enacted the Energy Conservation Act.
• For this first index, only Kerala (and Punjab) were able to provide energy intensity for commercial and residential buildings for the entire state.
• In DISCOMS, Kerala has the lowest T&D losses.
• In Ministry of Micro, Small and Medium Enterprises (MSME), though no state was able to furnish data on energy savings specifically in the MSME sector, Kerala provides technical and financial support for energy audits in MSME, as well as training for specific clusters.
• A best practice to be highlighted here is in the Pilicode gram panchayat in Kerala, which resulted in a bimonthly reduction of 1,20,328 units power consumption. This was made possible by a team of 650 volunteers, trained in energy conservation, who created awareness in households on energy conservation, power consumption of various types of lighting and appliances. The strategy included Whatsapp, government directions, subsidised LED bulbs and five-star rated fans to replace existing ones in streets and government buildings.

Rajasthan

• Rajasthan was among the four states that provided data on energy savings in the industrial sector as a whole.
• In MSME, Rajasthan has implemented fuel saving projects in five small scale industries.
• Rajasthan’s State Road Transportation Corporation has among the best performance for energy intensity.
• In DISCOMS, it is among the states with the most DSM regulations and programme in place.

Andhra Pradesh

• Andhra’s SDA is the only SDA in the country whose sole mandate is to promote energy efficiency. Most other SDAs have energy efficiency as an additional responsibility, which can digress to the mainstream functioning of the parent department.
• In buildings, Andhra Pradesh was the first state to incorporate ECBC in municipal building bye-laws.
• In the MSME sector, Andhra Pradesh has conducted workshops for clay brick cluster and ice-making cluster.
• In transport, not only does Andhra Pradesh have among the best performance for energy intensity of the State Road Transportation Corporation (SRTC), it also has amongst the most fuel-efficient SRTCs, and is among states that provide financial incentives for electric and hybrid vehicles.
• The state’s DISCOMS are among those with most DSM regulations and programme in place.

Maharashtra

• Maharashtra Energy Conservation Policy, 2016 – adopted by Maharashtra’s SDA – has been recommended by the AEEE report to be adopted by all current SDAs, to lay down a charter for policies and programmes pertaining to energy efficiency.
• In buildings, Maharashtra leads in terms of penetration of green buildings and BEE star-rated buildings, with BEE star appliances for all public buildings being made mandatory.
• In industry, Maharashtra and Tamil Nadu are the only states to have set energy saving targets for industry, apart from targets set for the PAT programme.
• In MSMEs, Maharashtra has a cluster development programme, which includes energy audits, workshops and demonstration projects.
• Under Municipality, the Maharashtra Energy Conservation Policy, 2017 has several good measures – schemes in street lighting and water pumping, for municipal corporations, councils, MIDC, etc, many of which are being adopted by MEDA.
• In transport, Maharashtra’s ‘Electric Vehicle Policy 2018’ provides for incentives and subsidies for EV manufacturing, charging infrastructure and EV ownership.
• Nagpur is the first city in India to have an electric mass mobility system, with Ola managing a fleet of 200 electric taxis, buses and rickshaws.

Punjab

• In buildings, Punjab has in place energy intensity provisions for commercial and residential buildings for the entire state.
• Many frontrunner states provide financial incentives for ECBC-compliant construction and retrofits, but Punjab additionally gives 15 per cent rebate in property tax.
• For this first Index, only Kerala and Punjab were able to provide energy intensity for commercial and residential buildings for the entire state.
• The Punjab government has also notified ‘The Punjab Municipal Green Buildings Incentives Policy- 2016’, with a host of incentives for energy-efficient green buildings.
• In Industry, 80 per cent or more DCs met the SEC target in PAT Cycle.
• Punjab was one of the four states that provided data on energy savings in the industrial sector as a whole
• The state also provides technical and financial support for energy audits in MSME.
• Punjab has implemented projects with Revolving Investment Fund (RIF) mechanism from its SECF (State Energy Conservation Fund).

Other ‘Energetic’ States

Haryana

The state missed being among the frontrunners by 1 point.

Uttar Pradesh

Under the Uttar Pradesh Kisan UDAY Yojana 2018, the government has begun distributing BEE 5-star rated energy-efficient pumps to 10 lakh farmers in the state, to replace the existing inefficient pumps and save approximately 3.5 billion units of electricity and Rs 1,350 crore every year. Uttar Pradesh also has 80 per cent or more designated consumers (DCs) meeting the specific energy consumption (SEC) target in PAT Cycle I.

Then, Karnataka, Odisha, Punjab and Uttarakhand have implemented projects with something called Revolving Investment Fund (RIF) mechanism from their State Energy Conservation Fund.

Goa, Meghalaya and Uttarakhand lead the PAT, with 100 per cent DCs in these states meeting the SEC target in PAT Cycle I.

Karnataka is a front-runner in electric mobility, with its ‘Karnataka Electric Vehicle and Energy Storage Policy 2017’ providing incentives and concessions for the e-mobility eco-system.

Meghalaya is the leader in EVs, with the highest proportion of EV’s (via the FAME scheme), and Delhi, Gujarat, Haryana, and Uttarakhand follow.

What All States Are Not Doing Right

To begin with, as the report says: “Across all sectors, energy intensity and energy savings data are not properly tracked, owing primarily to non-existent data reporting frameworks and lack of mandates”.

For this index to reflect meaningfully the geographical break up of energy efficiency, proper data tracking needs to be priority. Reportedly, for this edition of the index, the energy intensity indicator was included only for building and transport sectors due to lack of data availability in remaining sectors. Also, only two states could provide data on energy intensity. Transport and municipality sectors were specially highlighted as requiring more rigorous data collection.

Next, high T&D losses in most states lead to enormous energy leakages (only three states have T&D losses below 15 per cent). This is the first thing that comes to mind when thinking Energy Saving and efficiency – unless this is tackled, the whole exercise lends itself to mockery.

Then, even though Industry accounts for 53 per cent of total primary energy supply in India, and more than 30 per cent in most states, the level of energy efficiency initiatives is completely not commensurate with the energy consumption in this sector.

And then, the MSME sector - which is being given impetus by the government through various efforts – still does not have top-of-mind recall when it comes to programmes for driving energy efficiency. No state was able to furnish data on energy savings specifically in the MSME sector.

What the Index Is Not Doing Right

Is there scope for improvisation – read Indianisation – of the State Energy Efficiency Index in subsequent editions? The current Index was developed with the technical support of the American Council for an Energy Efficient Economy (ACEEE), which publishes 11 the US State Energy Efficiency Scorecard and the International Energy Efficiency Scorecard. Indian academics and experts in the energy area could help fine-tune it to Indian needs. An important area to consider, for instance, is the following:

Unfair To Certain `Aspirant’ States

While the intention of the index is good, it could unwittingly be showing states in the north-east in poor light. It is ironical that their scores of less than 30 on the energy efficiency index could be taken as indicators of high carbon footprint. On the contrary, they have high carbon storage, Arunachal Pradesh being the one with the highest carbon storage.

While it is desirable that they get strong SDAs in place, improve on energy data reporting, and have good energy efficiency initiatives, the current picture that the index paints to outsiders may discourage investors in energy efficiency projects.

It is also possible, that their topography and level of development and industrialisation necessitates a different set of parameters and indicators that they need to be judged on. On other counts, handholding them through establishing the right practices may be appropriate.

In the very least, these states deserve separate mention on the government website.

Finally, political compulsions often interfere with good economics, and have the potential to completely reverse good intentions. For instance, a regular in this category is the agriculture sector, which the ruling parties appease by 24-hour power supply. Measures like giving power to agricultural and industrial users during the day, where the peak demand coincides with availability of solar energy appeal to common sense. Many states were doing just the opposite, and the central government had to step in to correct it.

Finally, no matter what the states do and where they stand, the Centre will need to carry out its own regular audits on the states.