Bureau of Energy Efficiency (BEE) is a statutory body under Union Ministry of Power, Government of India that promotes many clean development mechanism (CDM) in our country.
Ajay Mathur, Director-General, Bureau of Energy Efficiency also a member of the Prime Minister’s Council on Climate Change has led the Bureau in driving India’s market transformation towards energy efficiency. He speaks to Renu Rajaram on the efforts of the BEE in promoting mechanism and products leading to efficient and clean use of energy.
Excerpts from the interview:
We have reached the middle of 12th five year plan. How much of planned energy efficiency have we achieved?
The Ministry of New and Renewable Energy has set specified target for capacity addition of the Renewable Energy sources viz. Wind Power, Solar Power, Small Hydro Power and Biomass Power in the 12th Five-Year Plan i.e. during the period 2012-17. The Ministry aims to add 10,000MW of grid-connected Solar Power generation capacity in the period of 2012-17 under the Jawaharlal Nehru National Solar Mission (JNNSM).
As per our 12th five year plan, we should achieve 20,000 MW capacity. Till now we have achieved 2500 MW in the first year of the plan. In the second year, which we are yet to complete, we should achieve somewhere around 3000 MW more which makes it to about 5,500 MW capacity till now. If we are on track, we also expect that when the first cycle of Project Appraisal Committee (PAC), is over – i.e., after 2014-15, we certainly will have a very large amount of renewables. The process is on and but would get reported only when the cycle is over. We are very much in track to achieve what is planned for the 12th five year plan. We may cross the figure too.
The growth of economy is affected by the large subsidies given. How is it affecting the fiscal deficit?
The fiscal deficit continues to be a problem. Various subsidies are in place to address particular issues. Since agriculture is dependent on irrigation to a great extent, power subsidies are given to farmers and their margins are narrow. There are very strong discussions going on to decide on which all subsidies make sense and what can be removed. We have seen the discussions on removing the subsidies on LPG cylinders. There is a very clear government feeling that unwanted and harmful subsidies should be removed. At the energy efficiency point of view, these subsidies do not make sense because they make us use more than what we otherwise would have. We like to see the subsidies, those do not serve social purpose, be removed at the earliest.
Now the government is coming up with plans for PPPs in the sectors like housing and industries. What is your view on government collaborating with private agencies in the renewable’s sector?
At the end of the day each of these actions would be done by private sectors; if it is making an energy efficient building or installing solar or wind electricity farms — It would be done by a private developer. It is all about manufacturing or buying an energy efficient equipment and products (like an air-conditioner which is star rated) which is again depending on a private company.
What the government can do is to have regulations in place and to have business models that would help private sector to invest in renewables and energy efficient appliances or building. Most of the action in this field is done by private agencies. All of them (the regulations) are about creating a demand for energy efficient products and services and for renewable energy production. There is no private sector investments in these areas which could be changed. Change in the political scenario, as far as inclusive growth is concerned, will not get affected. As far as inclusive growth is concerned, we need to make sure that the benefits should come to all, especially the poorest.
Consider energy efficiency, if we want even the poorest household has to get the advantage of the norms. We need to bring the advantage to the lowest strata of the economy too. For that what we are doing in the programmes for giving electric connections to those in below poverty line. We give them bulbs which are CFLs, A step forward; we have started giving then LED bulbs. So that the poorest reap the most benefits.
Considering the SME’s in village level, who depending on solar or wind powers, what kind of incentives are given to them?
The bureau of Energy efficiency is the agency mandated to promote programmes related to energy efficiency, renewables, etc. proposed by Ministry of New and Renewable Energy (MNRE) through incentives and promotions.
How would the PPP model help?
The PPP has a very specific legal meaning now. Now that we have guidelines brought in by the planning commission on what a PPP model should look like. The PPPs are creating a market even in rural areas with lot of corporates and government programmes promoting renewables in the rural areas. Rural population is able to understand the advantages of renewables and buy components needed for the same. Most of the corporate ventures help to sell products at a reduced rates and this create a market for the renewable energy or energy efficient technology & products. Thus we move towards a commercial venture than a subsidised venture.
Aren’t there problems arising in such kind of PPP and there are not many takers for government proposals?
In the renewable energy sector, there are programmes in which the private sector invests on solar and wind (any renewables) and the electricity produced is bought at a price fixed in advance either through a regulatory commission or through bidding process. In such cases there is never a problem.
What about the land acquisition problems faced by the wind or solar farms?
Land is a very valuable commodity in India. And every inch of it is converted from one use pattern to another. This will invite a lot of problems. The days are gone when the Government is saying that we are acquiring the land and use it for some other purpose. Even for the private developers if they have to go for an initiative, they have to buy the land. That is the simplest method.
We have national electricity grid. Irrespective of where the land is and where one is setting up a power plant, electricity can flow anywhere through this grid and could take it where the producer or consumer wants. Renewables should come up where the land is easily available and also where the resources are available in plenty.
GDP growth is proportionate to the Petroleum import and its use. Comment.
Since the year 2000, our average GDP growth is between 5 and 8 per cent. The energy growth has never been over 3 per cent a year during this time. The GDP growth has been higher than the growth of energy sector. We have broken the link between GDP growth and that of energy growth long time ago.
Please brief on your views about India’s future energy security?
India imports about 80 per cent of its oil. There is a threat of these increasing further, creating serious problems for India’s future energy security. Rising fossil fuel costs, particularly for natural gas in the electric power sector, along with government policies and programs to support renewable energy, will allow renewable fuels to compete economically over time.
The more we move towards energy efficient aspects, the demand for energy will definitely decrease. If we put in more renewables, we can reduce the import of coal, petroleum etc. the greatest advantage of the country would be more investments in renewable energy sector.
In the last year we saw a large pressure in the rupee due to the large import of fuels. If we can control the import bill, then we would be able to manage and better the economic stability of the country.