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Sansad TV: Perspective- The Energy Conservation (Amendment) Bill, 2022





Parliament has passed the Energy Conservation (Amendment) Bill, 2022. The Bill seeks to amend the Energy Conservation Act 2001 to facilitate the achievement of COP-26 goals and introduce concepts such as mandated use of non-fossil sources and carbon credit trading to ensure faster decarbonisation of the Indian economy. This Bill empowers the central government to specify a carbon credit trading scheme and provide for and Energy Conservation and Sustainable Building Code.

Analysis and Key highlights:

  • Energy Conservation as the name specifies it is to conserve energy. We have limited amount of energy at our disposal.
  • Obligation to use non-fossil sources of energyThe Act empowers the central government to specify energy consumption standards.  The Bill adds that the government may require the designated consumers to meet a minimum share of energy consumption from non-fossil sources.  Different consumption thresholds may be specified for different non-fossil sources and consumer categories.  Designated consumers include:
    • industries such as mining, steel, cement, textile, chemicals, and petrochemicals
    • transport sector including Railways
    • commercial buildings, as specified in the schedule.
  • Carbon trading:  The Bill empowers the central government to specify a carbon credit trading scheme.
    • Carbon credit implies a tradeable permit to produce a specified amount of carbon emissions.
    • The central government or any authorised agency may issue carbon credit certificates to entities registered under and compliant with the scheme.   The entities will be entitled to purchase or sell the certificate.
    • Any other person may also purchase a carbon credit certificate on a voluntary basis.
  • Energy conservation code for buildings:  The Act empowers the central government to specify energy conservation code for buildings.  The code prescribes energy consumption standards in terms of area.  The Bill amend this to provide for an ‘energy conservation and sustainable building code’.  This new code will provide norms for energy efficiency and conservation, use of renewable energy, and other requirements for green buildings.
  • Applicability to residential buildings:  Under the Act, the energy conservation code applies to commercial buildings:
    • erected after the notification of the code
    • having a minimum connected load of 100 kilo watts (kW) or contract load of 120 kilo volt ampere (kVA).
  • Under the Bill, the new energy conservation and sustainable building code will also apply to the office and residential buildings meeting the above criteria.  The Bill also empowers the state governments to lower the load thresholds.
  • Standards for vehicles and vessels:  Under the Act, the energy consumption standards may be specified for equipment and appliances which consume, generate, transmit, or supply energy.  The Bill expands the scope to include vehicles (as defined under the Motor Vehicles Act, 1988), and vessels (includes ships and boats).
  • Regulatory powers of SERCs: The Act empowers the State Electricity Regulatory Commissions (SERCs) to adjudge penalties under the Act.  The Bill adds that SERCs may also make regulations for discharging their functions.

Methods to Conserve Energy

  • Alternate sources of energy may be one of the methods of conserving the energy resources. There are other methods as well. Energy can be saved in the utilities.
  • Enhance the production efficiency, that is getting more electricity from the same amount of fuel.
  • Government can introduce taxation incentives to promote energy conservation.
  • One of the methods to conserve energy is in lightning sources. The CFL and LED lights have been introduced which consumes less energy and have got much longer lifetime. This programme has been quite successful and the government has encouraged LED usage in various sectors by reducing the cost and sometimes by distributing it free of cost.
  • Promote practices to save energy at houses. In summer the ACs are used at home. It has been found that if the room temperature is kept at 25 to 27 degrees which is quite comfortable a lot of energy can be saved as compared to cooling down to 20 or 18 degrees.
  • Sometimes water cooler can also be quite effective. Besides this we should fix the air leakages which consume lot of energy.
  • Switch of the electricity supply to the appliances whenever they are not in use and usage of smart windows.
  • There are different slabs in electricity bill like upto 200 units there are certain rates and after that there are higher rates and this encourages less consumption.

Need of the Hour

  • A combination of taxation and technology can make energy efficient appliances more affordable. There are some constrains. For example in LED industry to promote domestic industry some tax has to be imposed on imported items. The cost of the product can be distributed through electricity bills say Rs 10 a month so that over a period of time the cost of the appliances can be recovered without much burden.
  • Public transport has got lot of potential towards saving of energy. For example in railways, buses and metros. Metros have earned carbon credits from European Countries because of controlled emissions.
  • Extraction Techniques: coal mining has been done with outdated technology in India. So we can bring out better technologies. Similarly oil and gas can be extracted in more efficient ways.
  • In agriculture sector there are lot of diesel operated pumps. We need to promote efficient pumps and solar operated pumps.