Cabinet approved National Mission for Enhanced Energy Efficiency

The Union Cabinet has approved the implementation framework of the National Mission for Enhanced Energy Efficiency (NMEEE) to strengthen the market for energy efficiency by creating conducive regulatory and policy regime. NMEEE has been envisaged to foster innovative and sustainable business models to the energy efficiency sector. The Cabinet approval includes implementation plan of NMEEE, funds to the tune of Rs. 235.35 crores and creation of two new posts of Deputy Director General in BEE. The NMEEE is one of the eight national missions under the National Action Plan on Climate Change.

After the Cabinet approval, the Union Minister of Power, Shri Sushil Kumar Shinde, said, “Enhancing energy efficiency is one of the most important means to secure India’s energy requirements. Nod for NMEEE is an important milestone in our quest to promote energy efficiency and a major step towards energy security.”

Elaborating on the NMEEE, Shri P.Umashankar, Secretary, Ministry of Power, said, “This is a significant development for India. During the next four years, NMEEE will help achieve total avoided capacity addition of 19,598 MW, fuel savings of around 23 million tonnes per year and green house gas emissions reductions of 98.55 million tonnes per year.”

The NMEEE spelt out four new initiatives to enhance energy efficiency, in addition to the programmes on energy efficiency being pursued. The flagship of the mission is Perform Achieve and Trade Scheme (PAT), a market based mechanism to enhance cost effectiveness of improvements in energy efficiency in large industries. The trading of energy saving certificates would facilitate this process. The second initiative is Market Transformation for Energy Efficiency (MTEE), which includes accelerating the shift to energy efficient appliances in designated sectors through innovative measures to make the products more affordable.

NMEEE’s third initiative is the Energy Efficiency Financing Platform (EEFP), which allows for the creation of mechanisms that would help finance demand side management programmes in all sectors by capturing future energy savings. The final initiative is the Framework for Energy Efficient Economic Development (FEEED), to develop two fiscal instruments to promote energy efficiency - the Partial Risk Guarantee Fund (PRGF) and Venture Capital Fund for Energy Efficiency (VCFEE).