By adopting energy-efficient practices, the country not only cuts emissions but also saves millions of tonnes of oil equivalent, leading to a more sustainable future
Energy efficiency refers to the practice of using less energy to achieve the same level of output or perform the same task. It is one of the most impactful strategies for reducing energy consumption, cutting costs, and mitigating environmental harm. As global energy demand continues to rise, enhancing energy efficiency has become critical in the fight against climate change, resource conservation, and ensuring a sustainable future. According to the International Energy Agency (IEA), the global rate of energy efficiency improvement has averaged around 2 per cent per year, with some variations during the COVID-19 pandemic. In 2023, global energy consumption reached approximately 15,000 million tons of oil equivalent (MTOE), as reported in the Enerdata Yearbook 2024. A 2 per cent improvement in efficiency would save about 300 MTOE—an amount greater than India’s entire industrial energy consumption, which stands at around 270 MTOE in 2022-23. In 2022-23, sectors such as industry, buildings, and transport consumed 552 MTOE out of India’s total primary energy consumption of 850 MTOE. The industrial sector accounted for 49 per cent of this total, while transport and buildings (residential and commercial) contributed 12 per cent and 13 per cent, respectively. India is one of the few nations with a comprehensive legal and institutional framework for energy conservation.
The Energy Conservation Act of 2001 and the Bureau of Energy Efficiency under the Ministry of Power are pivotal in driving energy efficiency programmes across various sectors. India’s flagship programmes include the Perform, Achieve, and Trade (PAT) Scheme for energy-intensive industries, initiatives for energy-efficient buildings, vehicle fuel efficiency standards, and the star rating and labelling scheme for household appliances and industrial equipment. In 2022-23, these programmes collectively saved around 51 MTOE, equivalent to reducing carbon emissions by approximately 306 million tons of CO2. This energy efficiency contribution accounts for about 10 per cent of India’s annual emissions, which stands at around 3 billion tons of CO2. Energy efficiency is projected to play a crucial role in global climate action.
It is estimated that nearly 40 per cent of the emissions reductions needed to reach net zero by 2050 must come from energy efficiency measures, many of which offer short payback periods ranging from 3-5 years. Often dubbed the "first fuel," energy efficiency is seen as a vital tool in maintaining a sustainable, low-carbon future. Given the constrained carbon budget outlined in the Intergovernmental Panel on Climate Change (IPCC) Sixth Assessment, energy efficiency is more important than ever in controlling global temperature rise.
The Importance of Energy Efficiency: It is a cornerstone of sustainable development, offering multiple advantages such as cost savings, environmental protection, energy security and resource conservation.
Energy-efficient technologies reduce consumption, which, in turn, cuts utility bills for individuals, businesses, and governments. Reduced energy use decreases greenhouse gas emissions and helps combat global warming. It also diminishes pollutants that harm air and water quality. Additionally, energy efficiency decreases overall demand, reducing dependence on fossil fuels and strengthening energy security, especially for countries heavily reliant on imports. It also reduces the need for new power plants and industrial facilities, conserving natural resources and limiting environmental impact.
Key Sectors and Strategies industry: The industrial sector is the largest global energy consumer, driven by processes such as manufacturing, mining and machinery use. Enhancing energy efficiency in this sector involves optimising processes, recovering waste energy, and implementing energy management systems. Upgrading equipment, improving production methods, and utilising efficient motors and pumps can significantly reduce energy consumption. The National Mission for Enhanced Energy Efficiency (NMEEE), launched in 2011, targets energy-intensive industries.
Under its PAT Scheme, industries are assigned specific energy-saving targets (energy use per unit of product), and the market-based approach allows trading of excess energy savings. This initiative has resulted in substantial energy savings, leading to a reduction of approximately 110 million tonnes of CO2 emissions. As of August 2024, the PAT scheme covers 1,333 energy-intensive industries and establishments across 13 sectors, including steel, cement, aluminium, fertilizer, petroleum refineries, thermal power plants, and others. As India develops its carbon market mechanism, many of these sectors will participate as "obligated entities" with specific greenhouse gas (GHG) emission reduction targets.
The carbon market will facilitate this transition by implementing a market-based approach to pricing GHG emissions. This mechanism encourages both public and private entities to engage in decarbonisation efforts across various sectors. Entities that reduce emissions below their targets can earn Carbon Credit Certificates, while those that do not must purchase credits to comply. Additionally, the mechanism will have a voluntary component, allowing non-obligated entities to register projects focused on reducing, removing, or avoiding GHG emissions to obtain carbon credits.
The Standards & Labeling (S&L) Programme: launched in 2006, rates appliances based on their energy efficiency, from 1 to 5 stars. This program covers 38 appliances, with 16 falling under mandatory regulations. As of August 2024, the programme has saved 82 billion units of energy, equivalent to cutting 58 million tons of CO2 emissions.
The UJALA Scheme and the Street Light National Program (SLNP) have also been successful in replacing inefficient lighting with LED solutions, leading to significant energy savings and emission reductions. As of September 2024, approximately 370 million LED bulbs and 7.2 million LED tube lights have been distributed through the UJALA scheme. This has resulted in an annual reduction of 39 million tons of CO2 emissions. Buildings: Buildings are another major energy consumer, particularly through heating, cooling, and lighting. Energy-efficient building design, proper insulation, and smart energy management systems can dramatically reduce energy use.
The Energy Conservation Building Code (ECBC), introduced in 2007, mandates minimum energy performance standards for commercial and residential buildings. Recent updates, such as the Energy Conservation and Sustainable Building Code (ECSBC) and the Eco Niwas Samhita (ENS) for residential buildings, aim to further reduce energy consumption in large buildings by up to 18 per cent. Transportation: It is a major contributor to global energy use, primarily from fossil fuels. Improving fuel efficiency in vehicles and promoting electric and hybrid vehicles are key strategies.
The Indian government has implemented fuel efficiency standards for passenger cars and heavy-duty vehicles and aims to expand the electric vehicle ecosystem including charging infrastructure. As of 2024, India’s charging stations are expected to increase to 100,000 by 2030, supporting the growing number of electric vehicles. To create awareness of the benefits of Electric Vehicles (EVs), the “Go electric” Campaign was launched in Feb 2021. This involves radio jingles, poster/leaflets distribution, awareness through social media platforms, street plays, etc.
Electricity Generation and Transmission: Upgrading power plants and incorporating renewable energy sources such as solar and wind are vital for reducing emissions in electricity generation. Under the PAT Scheme, India’s thermal power plants have improved their efficiency, contributing to a reduction of 30 million tons of CO2. As of August 2024, 46 per cent of India’s installed power capacity comes from non-fossil fuel sources, surpassing the commitment made at the Paris COP 21 summit.
Challenges: Despite its benefits, the adoption of energy efficiency measures faces challenges like high upfront costs, limited awareness, and policy gaps. These barriers can be addressed through financial support mechanisms, capacity-building initiatives, and the development of comprehensive, flexible policies. Conclusion Energy efficiency is an essential driver of sustainable development, offering significant economic, environmental, and social benefits.
As technology improves and policies strengthen, energy efficiency will remain crucial in reducing energy demand and mitigating climate change. By adopting energy-efficient practices in our homes, industries, and transportation systems, we can contribute to a cleaner, more sustainable future.
(The writer is DDG, Bureau of Energy Efficiency; views are personal)
