1. Presented by Sanjay Seth Bureau of Energy Efficiency

2. Sectoral Energy Consumption Domestic and Commercial Sectors account for 30% of Energy Consumption

3. Electricity Use in the Commercial Sector

4. What are Energy Conservation Building Codes? ECBC was launched by Govt. of India on 27.5.2007 Mandatory Scope Covers commercial buildings Applies to New Construction only Building components included – Building Envelope (Walls, Roofs, Windows) – Lighting (Indoor and Outdoor) – Heating Ventilation and Air Conditioning (HVAC) System – Solar Water Heating and Pumping – Electrical Systems (Power Factor, Transformers) Potential to save 1.7 billion units annually on mandatory application Expected reduction in XI plan is 500 MW

5. Energy Efficiency in Existing Buildings/ facilities  There is vast scope for energy efficiency improvement in buildings/ existing facilities.  Energy Audit Studies have revealed a savings potential to the extent of 40% in end use such as lighting, cooling, ventilation, refrigeration etc.  Audits identify the Energy baselines in existing facilities along with Energy Efficiency Measures.

6. Energy Service Companies(ESCOs) ESCO engages in a performance based contract with a client firm to implement measures which reduce energy consumption and cost in a technically and financially viable manner. ESCO acts as project developer for a wide range of tasks and assume the technical and performance risk associated with the project. ESCO offers comprehensive services beginning with energy saving audits and concluding with maintenance of EEMs after implementation. ESCO achieves specified level of energy savings by monitoring and verification of the EEMs.

7. Energy Efficiency Measures Energy efficiency measures bring about energy savings due to reduced energy consumptions. Energy savings are determined by comparing energy baseline with energy consumed after implementation of EE measures. Energy cost savings resulting from EE measures directly benefit client facilities over the life cycle of the project.

8. Models of Performance Contracting. PERFORMANCE GUARANTEE ESCO provides energy audit and operation and maintenance of retrofitted equipment with performance guarantee SHARED SAVING ESCO provides energy audit, finance and implements the measures under the performance contract with shared savings.

9. Energy Efficiency in Govt. Buildings  Under the 1 st phase of Energy Efficient Govt. Buildings Programme 9 public buildings were taken up for energy audits  These include:-Rashtripati Bhawan, Prime Minister’s Office, South Block, Rail Bhawan, Sanchar Bhawan, Shram Shakti Bhawan, Transport Bhawan, R& R Hospital, Delhi airport and AllMS.

10. Government Initiatives( 2 nd Phase) Encouraging results in the first phase of Energy Efficiency in Government Buildings Programme 17 more government buildings have been undertaken for 2 nd phase through performance contracting under the ESCO route. These include Nirman Bhawan, Udyog Bhawan, Shastri Bhawan, North Block, South Block, Vigyan Bhawan, National Archives, Yojana Bhawan, Sardar Patel Bhawan, Supreme Court, Safdarjunj Hospital, SSK Hospital, Parliament House & Parliament Annex, Pariyavaran Bhawan and NIC, CGO Complex.

11. Building particulars Annual Energy Consumption (lakh kWH) Annual Energy savings (lakh kWH)% Savings Annual energy savings (Rs. Lakhs) Investment (Rs. Lakhs) Pay back period (years) Rashtrapati Bhawan 34.17.8235951.21 PMO8.3 2.73216.950.53 Sanchar Bhawan25.6 11.94676147.11.9 Shram Shakti & Transport Bhawan 20.4 83942.9157.53.7 Airport713 145205868101.5 Rail Bhawan23.5 625401634.2 AIIMS369 93.12971210701.5 Energy Audit Results- 1 st phase

12. Barriers to ESCO development Energy Conservation & Efficiency measures at nascent stage of development. Lack of information and awareness about ESCOs. Lack of motivation and initiative on the part of the developers. Higher cost of Energy Efficient technologies. Absence of proper frame work and guidelines for creation of appropriate environment for ESCO market. Asymmetry in sharing of costs and benefits.

13. Barriers to Promotional Incentives Lack of support system by the Government. Lack of information on success stories. Reinforcement policies on financial support by the Government. Lack of R&D facilities on EE technologies. Inadequacy of financial business models to promote ESCOs.

14. Interventions to Barriers ECAP developed- Close coordination between BEE & SDAs to disseminate information. BEE is expanding the database of ESCOs which would be shared with the SDAs. National workshops to promote EEMs through the ESCO route. Adoption of CDM to service investments made upfront. Incentives to industry to adopt conservation/ efficiency measures. Standard Performance Contract document be evolved based on M&V protocol, project financing & timely payments. Standardize Monitoring and Verification Protocol for assessment of savings. Savings through Life Cycle cost analysis.

15. Interventions by Government Involvement of Central/ State Govts. to develop favorable policies and regulations. Development of Innovative financial instruments for promoting performance contracting to overcome lack of effective delivery mechanism. Innovative Financial products, like securitization of receivables, energy efficiency bonds to fund the projects Provide a suitable subsidy linked funding mechanism with due incentives for an appropriate Public Private Partnership (PPP) Provide sufficient measures to ringfence all the risks associated with such projects

16. Interventions by Industry Establishment of an ESCO Promotion Council. Confidence building measure in favor of Energy Efficient Technologies through R&D. Adoption of best practices prevalent internationally. Voluntary adoption of energy conservation / efficiency by the industry.

17. Roadmap for ESCO Development Strategies Short TermEstablishment of an ESCO Promotion Council. Empanelment of ESCOs and their rating in terms of ability to undertake performance contracting. Creation of appropriate environment for ESCO market by implementing Pilot Projects in the Govt./Public Sector both at Central and State level. Establish innovative financial instruments. Preparation of standard Rfp, Performance Contract and M&V documents. Medium TermPreparation of manuals and guidelines to describe ESCO business. Dissemination of best practices & demonstrate case studies Technical guidelines on Monitoring and Verification protocols. Training and capacity building both at Central & State level. Development of a Program of Activities under CDM. Long TermTo develop a market for performance contracting on a sustainable basis by removing all barriers of financing on project finance mode.

18. ESCO Empanelment BEE is promoting implementation of energy conservation measures in existing buildings / facilities through the ESCO route. The BEE had published an EOI seeking the empanelment of ESCOs in all leading National dailies This data base of short listed ESCOs would be shared by BEE with the State Designated Agencies. This shortlist would be reviewed at the end of 2 years.

19. Next Steps BEE has proposed accreditation of the short listed ESCOs by CRISIL, ICRA, FITCH and CARE. Terms of Reference for these ratings have been finalized. SDAs need to identify 50 Govt./ semi government buildings in their respective states for energy audits & preparation of DPRs. BEE would provide financial assistance to SDAs for energy audits Baseline being developed through a survey of existing buildings

20. The guidelines are for financing DPRs through government agencies and require beneficiary government agency to provide the following details to access funding as approved Preliminary Details/ Identitification of buildings Ownership of the project by SDA/ Other government agency Competitive bidding for selection of ESCO Quantifiable Timelines and Deliverables Cost of IGA and Financing Options Contractual Arrangement including Monitoring and Verification, Dispute Resolution Mechanism, etc Quantifiable deliverable based financing to cover costs upto DPR preparation proposed Guidelines to support Audits in Government Buildings through SDAs

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