Energy efficiency initiatives: Indian experience

Dipankar Dey, PhD, Associate Dean (Research), ICFAI Business School, Kolkata,(IBS-K), India

Keywords

India energy, eco label, energy efficiency, energy conservation, energy savings

Abstract

India, with a population of over 1.10 billion is one of the fastest growing economies of the world. As domestic sources of different conventional commercial energy are drying up, dependence on foreign energy sources is increasing. There exists a huge potential for saving energy in India. After the first ‘oil shock’ (1973), the government of India realized the need for conservation of energy and a ‘Petroleum Conservation Action Group’ was formed in 1976. Since then many initiatives aiming at energy conservation and improving energy efficiency, have been undertaken (the establishment of Petroleum Conservation Research Association in 1978; the notification of Eco labelling scheme in 1991; the formation of Bureau of Energy Efficiency in 2002). But no such initiative was successful. In this paper an attempt has been made to analyze the changing importance of energy conservation/efficiency measures which have been initiated in India between 1970 and 2005.

The present study tries to analyze the limitations and the reasons of failure of those initiatives. The probable reasons are: fuel pricing mechanism (including subsidies), political factors, corruption and unethical practices, influence of oil and related industry lobbies – both internal and external, the economic situation and the prolonged protection of domestic industries. Further, as India is opening its economy, the study explores the opportunities that the globally competitive market would offer to improve the overall energy efficiency of the economy.

The study suggests that the Bureau of Energy Efficiency (BEE) - the newly formed nodal agency for improving energy efficiency of the economy— may be made an autonomous institution where intervention from the politicians would be very low. For proper implementation of different initiatives to improve energy efficiency, BEE should involve more the civil societies (NGO) from the inception to the implementation stage of the programs. The paper also highlights a few challenges that the government of India is likely to face in the near future.