Energy conservation: Best cost-effective option

When it comes to energy, conservation is the more optimal option for a country like India where the energy demand is growing with every passing day. Remember, cost-effective energy production adds to your monthly budget. So as the slogan says—Save Energy, Save India.

India celebrates the 33rd National Energy Conservation Day today. The Government of India through the Ministry of Power, instituted it on December 14, 1991, as an initiative to promote energy efficiency and conserve power.

33 years on, the country has come a somewhat long way. According to the International Energy Agency (IEA), India’s economy is already 10 percent more energy efficient than both the global and G20 average. India took less time to go from half to full electricity access than other major economies.

India’s energy efficiency market is worth INR 1.5 lakh crore, with energy service companies (ESCOs) only tapping 5% of its potential. India ranks 67th globally in the World Economic Forum’s Energy Transition Index, with momentum for sustainability, energy security, and equity. The country is the third global producer of renewable energy, with non-fossil fuel sources accounting for over 40% of its electricity capacity. Coal, oil, and solid biomass account for over 80% of India’s energy needs. It is the third largest electricity producer in the world with around 420 GW of installed power. 44% of the total installed capacity is from non-fossil sources. As per Power Minister, the country aims to achieve 50% from non-fossil fuels by 2030.

This was made possible because of the policy support and participation from the private sector.

The energy policy of India is to increase the locally produced energy in India and attain energy security (reduce energy poverty), with more focus on developing alternative sources of energy, particularly nuclear, solar, and wind energy. Net energy import dependency was 40.9% in 2021-22.

Here’s a look at other initiatives:

The government agency that takes the lead in promoting energy efficiency programs and ratings, The Bureau of Energy Efficiency (BEE) has introduced various initiatives to promote energy efficiency in energy-intensive industries.

These include the Perform, Achieve, and Trade (PAT) scheme, Market Transformation for Energy Efficiency (MTEE), Energy Efficiency Financing Platform (EEFP), and Framework for Energy Efficient Economic Development (FEEED). PAT is expected to serve as a valuable business model for energy efficiency programs, as standards and labeling of equipment and appliances have revolutionized the market.

The National Mission for Enhanced Energy Efficiency (NMEEE) under the National Action Plan on Climate Change (NAPCC) aims to strengthen the market for energy efficiency and foster innovative business models.

The BEE and NCERT are also promoting energy efficiency in schools through Energy Clubs and preparing materials for inclusion in NCERT’s science syllabi and textbooks.

The government has also launched the UJALA scheme to promote energy-efficient LED bulbs, and electric vehicles, and the National Electric Mobility Mission Plan to achieve national fuel security. Haryana has been selected for the National Energy Conservation Award (NECA) 2023 for its outstanding performance in the State Energy Efficiency Index.

But is everything hunky dory?

Sanjay Vashist, Director, Climate Action Network South Asia, has opined that India has always had a clear stance on coal, and it was instrumental in getting the word “phase-down” substituted for “phase-out” in the Glasgow COP26 cover text. India cannot agree to the developed countries’ attempt to link the pledge’s expansion of renewable energy to a reduction in coal use, he argued.

Contextually, two years later, India and China did not sign a pledge to triple global renewable energy, despite the G20 mentioning the need during the Indian presidency. India cannot be part of a pledge calling for the phase-down of coal power, cessation of investment in new coal-fired power plants, or reduced unabated fossil fuels by the middle of the century. The country plans to build more coal-based power plants to meet increasing electricity demand. In the next year, it is expected to add 17GW of coal-fired power production. However, India is one of the 118 countries that signed the pledge to triple RE generation by 2030 in COP28 concluded in Dubai

Back home, one of the most important global issues that National Energy Conservation Day helps to mitigate is climate change by promoting energy-efficient technologies and practices. Lower carbon emissions from reduced energy use contribute to the fight against global warming and its effects.

Energy efficiency and conservation are two different strategies, but they both have the power to reduce our reliance on fossil fuels. By lowering greenhouse gas emissions that may be harmful to the atmosphere, benefits not only the domestic economy but also the environment.

The JSW Group has joined the World Business Council for Sustainable Development (WBCSD).

Mr. Seshagiri Rao, Joint Managing Director and Group CFO will represent the JSW Group at the council which has more than 200 companies as members.

He will also take part in the WBCSD CFO network, which is driving ESG performance within companies, and effective disclosure to capital markets, the company said in a press release.

“The JSW Group is joining WBCSD at an important time when expectations of business have never been higher,” said Joe Phelan, India Director, WBCSD. “It is a major player in the global steel industry, which is critical to climate action, as well as in energy, infrastructure, and more. We look forward to providing opportunities for them to increase and accelerate the role they play in a sustainable world.”

Peter Bakker, President and CEO, WBCSD, said, “Only collaboration at unprecedented levels will create the impact and scale of transformations that are required for more than 9 billion people to live well, within planetary boundaries, by mid-century – as laid out in Vision 2050: Time to Transform.”

It must be noted that the $22 billion multinational conglomerate headquartered in India, has set ambitious sustainability targets. For example, JSW Steel has set a target of reducing its CO2 emissions by 42% by FY2030, aligning its target with the Sustainable Development Scenario (SDS) of International Energy Agency (IEA). JSW Energy has committed to be carbon neutral by 2050.

The energy scenario is set to change significantly by 2030, based on today’s policy settings, says a new IEA WEO 2023 report.

By 2030, the global energy scenario will undergo significant change, according to the International Energy Agency’s World Energy Outlook (WEO) 2023 report.

Ongoing major shifts, the rise of clean energy technologies, and economic changes are causing a surge in global demand for coal, oil, and natural gas. For example, the rapid advancement of solar, wind, electric cars, and heat pumps is significantly altering the way we power our homes, factories, and vehicles. Electric cars are expected to reach nearly 10 times the number on the road, the report notes.

The India picture:

According to WEO 2023, India is expected to meet its 2030 target of having half of its electricity capacity be non-fossil well before the end of the decade.

By 2030, India’s industry will produce 30% less CO2, and 60% of two- and three-wheelers will be electric. Progress is also being made towards universal access to modern energy, with 670 million people gaining access to modern cooking fuels and 500 million to electricity.

By 2030, India’s industry will produce 30% less carbon dioxide (CO2) than it does now, and passenger cars will emit 25% less CO2 per kilometre on average. In 2030, about 60% of two- and three-wheelers sold will be electric—a ten-fold increase from the current percentage.

Global watch:

Scenario analysis:

The global population is expected to grow by 1.7 billion by 2050. Asia and Africa will be the largest sources of energy demand growth. Emerging and developing economies can achieve national energy and climate targets by implementing clean electrification, efficiency improvements, and transitioning to lower- and zero-carbon fuels.

By 2030, Indonesia’s renewable energy share of the country’s power generation will have doubled to over 35%. By the end of the decade, biofuels in Brazil will account for 40% of road transport fuel demand, up from 25% currently. In order to meet a variety of national energy and climate targets, sub-Saharan Africa must rely on renewable energy sources for 85% of newly constructed power plants by 2030.

By 2030, 670 million people will have access to modern cooking fuels and 500 million to electricity, marking significant progress towards universal energy access.

The global energy supply’s fossil fuel share is predicted to decrease from 80% to 73% by 2030. However, global energy-related carbon dioxide (CO2) emissions will peak by 2025.

5 pillars for a global strategy:

The WEO-2023 proposes a global strategy for getting the world on track by 2030 that consists of five key pillars, which can also provide the basis for a successful COP28 climate change conference.

tripling global renewable capacity;
doubling the rate of energy efficiency improvements;
slashing methane emissions from fossil fuel operations by 75%;
innovative, large-scale financing mechanisms to triple clean energy investments in emerging and developing economies;
Measures to ensure an orderly decline in the use of fossil fuels, including an end to new approvals of unabated coal-fired power plants

Geopolitics, challenges, and impact:

The current high demand for fossil fuels is expected to hinder the Paris Agreement’s goal of limiting global temperature rise to 1.5°C. The energy system, designed for a colder world with fewer extreme weather events, is at risk of weakening due to increased heat records. The current policy configurations have significantly increased clean energy production, but the consequences of doing nothing could be catastrophic.

WEO-2023 explores energy security challenges in the Middle East, exacerbated by geopolitical tensions and the global energy crisis, aggravated by inflation and high borrowing costs. However, new LNG projects set to commence in 2025 are expected to increase capacity by over 250 billion cubic meters annually by 2030. These will account for nearly 45% of the world’s current LNG supply.

The increase in gas capacity may alleviate price and supply concerns. But it may also lead to a glut due to slowed global gas demand growth since 2010. Russia will thus have very little opportunity to increase the size of its clientele. By 2030, its proportion of gas traded internationally, which was 30% in 2021, is expected to decrease to half.

WEO-2023 also examines one significant variable for the energy markets in the upcoming years—China. China, a major player in global energy trends, is experiencing significant changes due to its slowing economy and structural changes. Its energy consumption is predicted to peak in the mid-2020s, with fossil fuel demand and emissions expected to decrease as clean energy growth accelerates.

The solar story:

The WEO predicts strong growth in solar PV this decade, with renewables contributing 80% of new power generation capacity by 2030.

Tata Steel and ABB India have signed a Memorandum of Understanding (MoU) regarding energy efficiency, decarbonization, circularity

As per the MoU, the two companies will focus on system-level assessments of Tata Steel’s manufacturing plants and production facilities to reduce the carbon footprint in steel production. The two companies will evaluate and co-develop short and long-term options for energy efficiency, decarbonization, and circularity in plants and production facilities.

Tata Steel and ABB are exploring integrated electrification and digital systems, including ABB Ability e-Mine and e-Mobility solutions, for energy optimization using hydrogen as a substitute fuel.

The partnership will enable Tata Steel to pursue its carbon neutrality target by 2045 as one of its major sustainability goals. In line with its aspirations, the steelmaker has a medium-term target to reduce carbon emissions to less than two tons of CO₂ per ton of crude steel in its Indian operations by 2025.

“The World Economic Forum figures anticipate the energy transition will require three billion tons of metals over the medium-term; six times more mineral inputs by 2040 to reach net-zero emissions globally by 2050. ABB is confident in working with our customers and partners to evolve how steelmaking is powered to help reach production and environmental targets,” said Vipul Gautam, Group Vice President, Global Account Executive for Tata Group, ABB.

The global steel industry contributes between 7 to 9 percent of global fossil fuel CO₂ emissions, according to various sources including the International Energy Agency (IEA).

Tag: International Energy Agency (IEA)