1. Page 1 of 7 Growth presents challenge – and opportunity  Energy needs will increase 3-times in the next 15 years  Vast opportunities for cost-effective, low- carbon options as large fraction of infrastructure is yet to be built  Energy efficiency reduces costs to energy users, national energy imports, and urban pollution, but High first costs deter users, especially households New technologies are perceived as being risky; on the other hand, capacity expansion is attractive Split incentives deter investment, especially in the case of buildings

2. Page 2 of 7 Macro policies favors efficiency  Greater – and increasing – competition and globalization  Structural shift in economy towards the services sector  Energy prices are high Energy prices for industry are amongst highest in the world Consumers face energy prices that are highest in the world compared to their incomes

3. Page 3 of 7 Bandwidth of energy efficiency in industry is a challenge A wide bandwidth of energy efficiencies occurs in all industry sectors The most efficient plants are often globally the most efficient This makes it difficult to specify a single energy consumption norm “ Perform, Achieve & Trade” mechanism introduced for 468 industrial units which have to meet individual SEC reduction targets

4. Page 4 of 7 Perform, Achieve and Trade (PAT)  Covers units using about 200 million toe/year Gate-to-gate specific energy consumption, collectively, to be about 5% less in 2013-14 than it was in 2008-09 Less efficient units have larger SEC %-reduction targets – so that the collective SEC reduction is 5%

5. Page 5 of 7 Perform, Achieve and Trade (PAT)  Energy Savings Certificates would be issued to plants who achieve SEC less than their target SEC ESCerts can be purchased by plants to meet compliance ESCerts (and penalties) would be based on difference between the achieved SEC and the target SEC

6. Page 6 of 7 Accelerating the introduction of super-efficient appliances  Super-efficient devices are expensive – and consequently will have small markets Super-Efficient Equipment Programme (SEEP) envisages incentives to manufacturers for each super- efficient appliance sold  Ceiling fan is the first target appliance 40 million fans are sold each year; average fan uses 70 W; most efficient fan uses about 50 W Super-efficient fan specs target 25-30 W; specs also will include remote monitoring device Incentive amount will be determined through bidding Outreach campaign to inform consumers Incentive will be paid to manufacturers for 2-3 years based on monitored sales and performance

7. Page 7 of 7 Public policy nudges create markets  ”Branding” is a very effective tool  Market “creation” incentivizes early introduction of technologies  Both regulatory push and market pull are essential to enable market transformation