Assignment – 1
Kota Praveen Kumar
P141018

Introduction and Overview

1. What is Energy Efficiency?

Energy Efficiency means “Delivering the same, with less (or more with the same).

2. Importance of Energy Efficiency - What does Energy Efficiency has to offer?

• Limit demand growth

• Increase energy security

• Climate change mitigation

• Additional non-energy benefits for economy and society

By improving energy efficiency, cost of the energy system needed to power home or Institution or Industry can be reduced. Becoming more energy efficient is an important first step to reduce our impact on the environment. Energy efficiency is also a non-controversial issue, improving efficiency means encouraging innovation and technology, creating jobs, reducing our dependence on non-renewable resources, and saving money

3. Global Perspective

OECD Countries

OECD Countries through energy efficiency address the risks of climate change, an increasing number of countries, mainly from the OECD, have embarked on ambitious programmes, with energy efficiency often as the main pillar. Energy efficiency enables countries to alleviate the financial burden of oil imports on their balance of trade and also improves energy supply security

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4. Developing Countries

In developing countries the energy efficiency enables a reduction in overall investmentinto energy sector and will help to make the best use of assets to improve the energy access. Improving efficiency in use of electricity has two benefits: X Supplying more customers with the same Using the same electricity production capacity, thus providing electricity access for more people to s, which is often the main objective challenge in many countries of Africa and Asia. X Slowing down electricity demand growth, and so reducing the investment needed for expansion of the electricity sector. This is especially important in countries with high growth in electricity demand, such as China and many Southeast Asian countries.

5. Energy Efficiency Indicators

Energy efficiency indicators are an important tool for analysing the interactions among economic and human activity, energy use and CO₂ emissions. Many countries already employ energy indicators, a set of disaggregated measures of how energy is used.

Energy efficiency is high on the political agenda as governments seek to reduce wasteful energy consumption, strengthen energy security and cut greenhouse gas emissions. However, the lack of data for developing proper indicators to measure energy efficiency often prevents countries from transforming declarations into actions.

|Energy Efficiency/CO2 Indicators |India |
| | | | |
| |Unit |1990/13 (%/year)|2000/13 (%/year)|
| | |* |* |
|Key indicators | | | |
|Primary energy intensity (at purchasing power parities (ppp) |koe/$05p |-2.0 |-2.2 |
|Primary energy intensity excluding traditional fuels (ppp) |koe/$05p |-0.7 |-1.2 |
|Primary energy intensity adjusted to EU structure (ppp) |koe/$05p |-2.2 |-2.2 |
|Final energy intensity (at ppp) |koe/$05p |-2.9 |-2.7 |
|Final energy intensity at 2005 GDP structure (ppp) [2] |koe/$05p |-2.7 |-2.2 |
|Final energy intensity adjusted to EU economic structure (ppp) |koe/$05p |-3.2 |-2.8 |
|Ratio final/primary intensity |% |-0.9 |-0.7 |
|CO2 intensity (at ppp) [1] |kCO2/$05p |-0.5 |-0.9 |
|CO2 emissions per capita [1] |tCO2/cap |4.1 |4.6 |
|Industry | | | |
|Energy intensity of industry (to value added) (at ppp) |koe/$05p |-2.0 |-0.7 |
|Unit consumption of steel |toe/t |n.a. |n.a. |
|Share of electric process in steel production |% |n.a. |n.a. |
|CO2 intensity of industry (to value added) (at ppp) [1] [3] |kCO2/$05p |-0.6 |0.9 |
|Transport | | | |
|Energy intensity of transport to GDP (at ppp) |koe/$05p |-0.6 |0.0 |
|Rail passengers transport |pkm/hab |n.a. |n.a. |
|Share of biofuels in road transport energy consumption |% |n.a. |4.3 |
|CO2 intensity of transport to GDP (at ppp) [1] |kCO2/$05p |-0.8 |-0.2 |
|CO2 emissions of transport per capita [1] |tCO2/cap |3.8 |5.3 |
|Households | | | |
|Average electricity consumption of households per capita |kWh/cap |6.4 |6.0 |
|Average electricity consumption of electrified households |kWh/hh |n.a. |n.a. |
|Electricity consumption for electrical appliances and lighting |kWh/hh |n.a. |n.a. |
|Electricity consumption for thermal uses |kWh/hh |n.a. |n.a. |
|Per capita installed capacity of solar water heaters |m2/khab |n.a. |n.a. |
|CO2 emissions of residential sector per household [1] |tCO2/dw |n.a. |n.a. |
|Services | | | |
|Energy intensity of service sector (to value added) (at ppp) |koe/$05p |-4.0 |-3.4 |
|Electricity intensity of service sector (to value added) (at ppp) |kWh/k$05p |0.1 |-0.1 |
|CO2 intensity of service sector (to value added) (at ppp) [1] |kCO2/$05p |-5.4 |-2.7 |
|Agriculture | | | |
|Energy intensity of agriculture (to value added) (at ppp) |koe/$05p |1.4 |0.2 |
|CO2 intensity of agriculture (to value added) (at ppp) [1] |kCO2/$05p |0.7 |-1.7 |
|Transformation sector | | | |
|Efficiency of total electricity generation |% |-0.7 |-0.5 |
|Rate of electricity transmission-distribution losses |% |-0.6 |-3.6 |
|Efficiency of thermal power plants |% |-0.4 |-0.7 |
|Share of renewables in gross electricity consumption |% |-1.5 |1.9 |
|[1] CO2 from fuel combustion |[2] by main sector | | |
| | | | | | |

Potential for energy efficiency improvement in India

6. Energy efficiency economics and policy:

Energy efficiency and conservation have long been critical elements in the energy policy dialogue and have taken on a renewed importance as concerns about global climate change and energy security have intensified. Many advocates and policymakers hold that reducing the demand for energy is essential to meeting these challenges, and analyses tend to find that demand reductions can be a cost-effective means of addressing these concerns. With such great policy interest, a significant literature has developed over the past 30 years that provides an economic framework for addressing energy efficiency and conservation as well as empirical estimates of how consumers respond to policies to reduce the demand for energy.

7. Policy and Regulatory issues to promote efficiency:

Asia is expected to become the world's largest energy-consuming region in the foreseeable future. But unless measures are taken to contain energy consumption, it will be increasingly exposed to risks related to energy security and climate change.

Improving energy efficiency is a highly cost-effective alternative to increasing energy availability. A megawatt of power capacity saved - for example, by retrofitting energy-efficient industrial equipment - costs about half that of adding the equivalent coal-fired power-generating capacity.

This evaluation focuses on ADB interventions over the past several years to stimulate energy efficiency investment in industry and buildings. These accounted for more than 85% of the region's energy use in 2008. Both sectors provide a good opportunity for advancing demand-side energy efficiency. The evaluation study analyses a number of ADB-supported energy efficiency projects and interventions in South Asia and the People's Republic of China.

Among the key findings is that energy pricing and market imperfections need to be addressed to propagate energy efficiency investments. It says ADB and governments in developing member countries should support the removal of various barriers to energy efficiency investments in Asia and the Pacific. These include poor awareness among many energy users of readily available energy efficiency options and the high-risk perception of commercial banks of energy efficiency investments.

In line with the ADB's long-term vision set out in Strategy 2020, ADB is expected to move towards a balanced portfolio of supply- and demand-side energy efficiency interventions. ADB has already begun supporting some demand-side projects in recent years, and that these could be increased over the next several years in response to client demand and ADB's increased experience in preparing such interventions.

Energy Efficiency: Electricity Generation, Transmission and Distribution

8. Performance of Indian Plants vs international benchmarks

Indian coal-based thermal power plants are some of the most inefficient in the world according to a study conducted by Centre for Science & Environment (CSE). The study covered 47 plants across 16 states, accounting for half the coal-based thermal power plants in India. It found that the sector performed poorly on all environmental and energy parameters, getting a score of 23%. As many as 40% of the plants scored below 20%. Globally, a thermal plant following all the best practices can get a score of 80%.

9. AT&C Losses

The advantage of this parameter is that it provides a realistic picture of energy & revenue loss situation. The AT&C Losses comprise of two elements: - Technical Losses & Commercial Losses. T&C losses bear effect on the operational performance of BESCOM and Revenue. Besides this it also indicates healthiness of distribution system, billing and vigilance systems. As such AT&C losses are one of the important aspects needs to be kept at minimum possible level to ensure technical and financial sustainability of the Company.

10. Role of Smart Grids

The Smart Grid will provide tools and information essential to the solution or at least reducing these losses to an acceptable level, if there is acceptable level for this. Today this division between Technical and Commercial losses that the proportion of 58% for Technical losses and 42% for Commercial losses. The control of Technical and Commercial losses of electricity needs to be rigorously implemented and monitored in the distribution companies and electric utilities. The Utilities must therefore be able to identify the losses by type -- Technical or Commercial -- and where they occur, to try to reach the optimum level of losses.

11. Smart Grid Technologies & Status

Smart Grid acts as integrating the electrical and information, communication technologies in the complete power system value chain enabling every point for generation and every point as controllable consumption (of consumers). Ministry of Power (MoP) decided to develop Smart Grid in India in stages by taking up pilot Smart Grid projects. MoP set up the India Smart Grid Task Force (ISGTF) and India Smart Grid Forum (ISGF) to help prepare a roadmap for smart grid rollout. In August, the MoP adopted the roadmap. 14 smart grid pilots are been approved for immediate execution. Pilots will be evaluated for techno commercial benefits, technology evaluation and then scaled out into full projects.

The following are various functionalities being opted as part of the smart grid pilots in India.

• AMI for Residential, Commercial and Industrial
• Peak Load Management
• Outage Management
• Power Quality
• Renewable Integration
• Micro Grids
• Distributed Generation

Energy efficiency opportunities

The Energy Efficiency Opportunities (EEO) program was established in July 2006 with the implementation of the Energy Efficiency Opportunities Act 2006 (the Act). The object of the Act was to improve the identification and evaluation of energy efficiency opportunities by large energy-using corporations and, as a result, encourage implementation of cost-effective energy efficiency opportunities.

12. Energy efficiency opportunities in domestic fuels other than electricity:

The fuels commonly available to householders for ‘space’ (room) heating include: Gas, Oil, LPG, Coal-based solid fuels, Biomass (wood), Hot water mains (district heating). These fuels vary in many ways, including their cost, the cost of installing equipment to use them, convenience, availability and their CO2 emissions. Heat pumps can reduce the carbon emissions of electricity considerably – even achieving carbon emissions and fuelling costs below those of gas heating. Ground source heat pumps (GSHPs) are the most popular and efficient. They work on the principle of making the ground colder while making the home warmer. Sunlight passing through windows naturally heats internal areas. Solar gain, as it’s called, is often forgotten as a heat source. To take advantage of solar gain, a home needs large south-facing windows and smaller windows to the north. 13. Energy efficiency opportunities in industrial users:

The industrial sector offers tremendous opportunity for energy savings, and a significant opportunity to instill the tenets of energy efficiency within facilities. Industrial energy efficiency programs are predominately financed by systems benefit funds. The funding is then used to pay incentives or provide technical assistance for specific energy efficiency projects administered by local utilities or other entities. Industrial energy efficiency programs have been successful in achieving savings in the industrial sector, bringing industrial companies into a more energy-efficient paradigm. 14. Commercial users:

Energy management system (EMS) products that offer integrated controls capabilities across multiple building systems (HVAC, Lighting, etc.) and are specially designed for small, existing commercial buildings. Energy Management Systems (EMS) products that offer integrated control capabilities across multiple building systems and are specially designed for small, existing commercial buildings. 15. Manufacturing industries:

Energy efficiency can be considered the main energy saving opportunity for the manufacturing industry. Three factors will drive industry towards achieving it. The first is cutting energy costs. If energy constitutes a substantial input to industrial processes then this should be a straightforward incentive to improve energy efficiency. The second is regulation. Firms all over the world can expect growing pressure from their governments to cut carbon emissions. Such regulation could take the form of mandatory energy efficiency standards and targets, which penalize high energy consumption and reward emissions reductions. The third factor is that of shifting consumer preferences. Consumers are gradually beginning to favour firms who credibly demonstrate minimal environmental impact. This presents forward-thinking firms with an opportunity to develop and market low carbon products and gain market share from or collect a premium over more environmentally harmful alternatives.
1. Energy Audit

Energy Audit is the key to a systematic approach for decision-making in the area of energy management. It attempts to balance the total energy inputs with its use, and serves to identify all the energy streams in a facility. It quantifies energy usage according to its discrete functions. Industrial energy audit is an effective tool in defining and pursuing comprehensive energy management programme. As per the Energy Conservation Act, 2001, Energy Audit is defined as "the verification, monitoring and analysis of use of energy including submission of technical report containing recommendations for improving energy efficiency with cost benefit analysis and an action plan to reduce energy consumption".

1. Need for Energy Audit

Energy is one of the top three contributors to operational expenses. Energy Audit will help to understand more about the ways energy and fuel are used in any industry, and help in identifying the areas where waste can occur and where scope for improvement exists. The Energy Audit would give a positive orientation to the energy cost reduction, preventive maintenance and quality control programmes which are vital for production and utility activities.

The primary objective of Energy Audit is to determine ways to reduce energy consumption per unit of product output or to lower operating costs. Energy Audit provides a "bench-mark" (Reference point) for managing energy in the organization and also provides the basis for planning a more effective use of energy throughout the organization.

2. Identification of Energy Conservation Opportunities

Fuel substitution: Identifying the appropriate fuel for efficient energy conversion
Energy generation :Identifying Efficiency opportunities in energy conversion equipment/utility such as captive power generation, steam generation in boilers, thermic fluid heating, optimal loading of DG sets, minimum excess air combustion with boilers/thermic fluid heating, optimising existing efficiencies, efficienct energy conversion equipment, biomass gasifiers, Cogeneration, high efficiency DG sets, etc.
Energy distribution: Identifying Efficiency opportunities network such as transformers, cables, switchgears and power factor improvement in electrical systems and chilled water, cooling water, hot water, compressed air, Etc.
Energy usage by processes: This is where the major opportunity for improvement and many of them are hidden. Process analysis is useful tool for process integration measures.

3. Technical and Economic feasibility

The technical feasibility should address the following issues

• Technology availability, space, skilled manpower, reliability, service etc
• The impact of energy efficiency measure on safety, quality, production or process.
• The maintenance requirements and spares availability

The Economic viability often becomes the key parameter for the management acceptance. The economic analysis can be conducted by using a variety of methods. Example: Pay back method, Internal Rate of Return method, Net Present Value method etc. For low investment short duration measures, which have attractive economic viability, simplest of the methods, payback is usually sufficient.

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4. Benchmarking and Energy Performance

Benchmarking of energy consumption internally (historical / trend analysis) and externally (across similar industries) are two powerful tools for performance assessment and logical evolution of avenues for improvement. Historical data well documented helps to bring out energy consumption and cost trends month-wise / day-wise. Trend analysis of energy consumption, cost, relevant production features, specific energy consumption, help to understand effects of capacity utilization on energy use efficiency and costs on a broader scale. External benchmarking relates to inter-unit comparison across a group of similar units. However, it would be important to ascertain similarities, as otherwise findings can be grossly misleading.
Few comparative factors, which need to be looked into while benchmarking externally are:
• Scale of operation
• Vintage of technology
• Raw material specifications and quality
• Product specifications and quality
Benchmarking energy performance permits
• Quantification of fixed and variable energy consumption trends vis-à-vis production levels • Comparison of the industry energy performance with respect to various production levels (capacity utilization)
• Identification of best practices (based on the external benchmarking data)
• Scope and margin available for energy consumption and cost reduction
• Basis for monitoring and target setting exercises.
The benchmark parameters can be: • Gross production related e.g. kWh/MT clinker or cement produced (cement plant)
e.g. kWh/kg yarn produced (Textile unit) e.g. kWh/MT, kCal/kg, paper produced (Paper plant) e.g. kCal/kWh Power produced (Heat rate of a power plant) e.g. Million kilocals/MT Urea or Ammonia (Fertilizer plant) e.g. kWh/MT of liquid metal output (in a foundry)

5. Plant Energy Performance Plant energy performance (PEP) is the measure of whether a plant is now using more or less energy to manufacture its products than it did in the past: a measure of how well the energy management programme is doing. It compares the change in energy consumption from one year to the other considering production output. Plant energy performance monitoring compares plant energy use at a reference year with the subsequent years to determine the improvement that has been made. However, a plant production output may vary from year to year and the output has a significant bearing on plant energy use. For a meaningful comparison, it is necessary to determine the energy that would have been required to produce this year production output, if the plant had operated in the same way as it did during the reference year. This calculated value can then be compared with the actual value to determine the improvement or deterioration that has taken place since the reference year.