Energy conservation & Efficiency An important tool in our fight against high energy prices

1. Energy conservation & EfficiencyAn important tool in our fight against high energy prices By VISHALANAND A.M.(NR) E-mail: anandv@pcra.org PCRA –An Integrated Energy Solution Provider

2. Energy is scarce It is not just the threat of climate change which makes a U-turn in energy policies an urgent requirement. A fundamental reorientation is indispensable also because worldwide energy resources in terms of fossil fuels such as coal, gas and oil are of course limited. Independent studies have shown that on the basis of current rates of output, global oil reserves would last around 40 years, natural gas reserves 65 years, and coal deposits some 200 years. Embarking on renewable energy and energy saving – this is the double strategy to cope with diminishing energy reserves and the growing demand for energy without having to burden the environment even more.

3. Energy prices have multiplied over the last few years while the energy demand continues to grow According to the American Energy Information Administration (EIA) and to the International Energy Agency (IEA), the world-wide energy consumption will continue to increase by 2 % per year on average unless action is taken.  Why save energy?

4. According to the UN's Food and Agriculture Organization, energy prices influence all parts of our everyday life and are also seen as a determining factor for the high food prices. ConsumersIn the UK, 16 % of all households now live in fuel poverty, meaning that they spend more than 10 % of their income on energy expenses. Developing countriesThe UN estimates that the number of very poor people in the developing world will grow from one to two billion because their purchasing power has been reduced by half due to the high food and energy prices.

5. Reasons for the increasing oil prices: • The fast decline in the fossil fuel reserves. • According to ASPO (The Association for the Study of Peak Oil), we consume several times more conventional oil than we discover. That has made security of our energy supply a political headache.We are using many times more conventional oil than is discovered – putting supply and prices under even stronger pressure.

6. ENERGY DEMAND AND SUPPLY • On the energy demand and supply side, India is facing severe shortages • 70% of the total petroleum product demand is being met by imports, imposing a heavy burden on foreign exchange (Rs.170,000/- crores per year). • Country is also facing electric Power Shortages • Peak shortage –11% • Average shortages – 7% • Additional 100,000 MW required by 2012 • Approximately Rs. 8000 billion investment required • Further , the per capita consumption in India is too low as compared to developed countries (just 4% of USA and 20% of the world average). The per capita consumption is targetted to to grow to about 1000 kWh per year by 2012

7. Power Supply Position(2003 - 04)

8. Power Supply Position(2006 - 07)

9. EFFECTIVENESS OF ENERGY UTILISATION? • Indian industrial sector accounts for half of the commercial energy used in the country • Wide variation in energy consumption co-efficient among different units in the same industry using comparable technologies (30-150 % ) • Vast section of industry to still improve their energy efficiency • Also energy intensity per unit of GDP of Indian economy is very high in comparison with developed countries and Asian and world averages • This points to vast scope for energy saving potential

10. Priority areas: • Shrink the economy ? • Renewable energy • Energy efficiency/energy conservation

12. Energy Security through Energy Conservation • Huge Potential in reducing electrical consumption by improving supply side energy efficiency, demand side energy efficiency, electricity T&D and by adopting renewable electricity technologies. • Sector-wise conservation potential in the country has been estimated as: • industrial- 25%, Agricultural- 30%, Domestic & Commercial- 20%, Transport- 20% and Economy as a whole- 23%.

13. Energy- Today’s raw material With today's high energy cost, Energy can be taken as a major RAW MATERIAL And not merely an overhead

14. Potential for Energy Saving • Total Energy Consumption – 423 MMTOE • Total foreign exchange outgo – Rs.170,000 crores per annum. • Oil & Gas Consumption – 120 MMTOE • Potential for saving Energy – 15% • Total Energy Saving Potential – 18 MMTOE • Money Equivalent – Rs. 57600 Crores(@ Rs.32000/ ton)

15. Energy Conservation: Need of the Hour • Oil and Gas are major sources of energy. At production level it accounts for 42% . • Oil accounts for major portion of import bill. • More than 70% of demand met through imports at substantial cost. • Foreign Exchange outgo of approx. Rs.170,000/- Crores and will increase further. • Limited Reserves. • Bigger scope for R&D to develop fuel efficient products / processes/devices • Efficient Management and usage of gaseous fuels like CNG/LNG/CBM • Global competitiveness through energy efficiency. Conservation is imperative for the Country

16. IMPORTANCE OF ENERGY CONSERVATION • Energy efficiency/conservation measures can reduce peak and average demand. • One unit saved avoids 2.5 to 3 times of fresh capacity addition. • Investment in energy efficiency/energy conservation is highly cost effective. • Also avoids investment in fuel, mining, transportation etc. • Keeping the above factors in view and also to provide a policy guidance,Government of India enacted the Energy Conservation Act,2001

17. Conservation – the route to profitability

18. Barrier • Sometimes, even when the opportunities for energy savings are great, they are not utilized.The reasons fall into the familiar: • Was not aware of opportunities that exist • Did not know what to do • Top management not supportive • Energy issues not a priority • No money and/or staff and/or time • No defined accountability • Only new technology can improve energy efficiency

19. To start some objects to be put in place • Firm commitment of top management • Clearly defined program objective • Organizational structure & fixed responsibility • Provision of resources • Measures & tracking procedure • Regular progress review

20. Thank you