NATIONAL MISSION ON ENHANCED ENERGY EFFICIENCY
Perform Achieve and Trade (PAT) Mechanism
National Mission on Enhanced Energy Efficiency (NMEEE) is one of the eight missions which form India’s National Action Plan on Climate Change (NAPCC), formulated in the year 2008.The objective of this mission is to unlock energy efficiency opportunities through market based approach, estimated to be about Rs. 74,000 crores, annual fuel savings in excess of 23 million toe by 2014-15 and cumulative avoided electricity capacity addition of 19,000 MW.
NMEEE is comprising of following 4 components:
Perform, Achieve and Trade (PAT): This is a regulatory instrument to reduce specific energy consumption in energy intensive industries, with an associated market based mechanism to enhance the cost effectiveness through certification of excess energy saving which can be traded.
Market Transformation for Energy Efficiency (MTEE): This scheme proposes accelerating the shift to energy efficient appliances in designated sectors through innovative measures to make the products more affordable.
Energy Efficiency Financing Platform (EEFP): It is for creation of mechanisms which would help finance, demand side management programmes in all sectors by capturing future energy savings and for capacity building of financial institutions and ESCOs/Industries. excess energy saving which can be traded.
Framework for Energy Efficient Economic Development (FEEED): It is for development of fiscal instruments to promote energy efficiency.
Perform Achieve and Trade
Perform Achieve and Trade Scheme (PAT) is a market based mechanism to enhance the Energy Efficiency in Energy Intensive industries through certification of energy saving which can be traded. It is a market based mechanism to reduce the specific energy consumption in energy intensive industries. This is facilitated through the trading of ESCerts which are issued to those plants who have overachieved their targets. Those plants who were under achievers of their targets are entitled to purchase ESCerts.
The first cycle of PAT was completed in March 2015. Thereafter verification of the performance of DCs with regard to energy savings and based on recommendations made by BEE the Ministry of Power issued 38.24 lakhs (approx) ESCerts to 306 DCs on 16th Feb 2017. 110 DCs have been entitled to purchase 14.23 lakhs(apporx) ESCerts. The DCs have contributed to the success of PAT cycle I and this cycle has witnessed an energy saving of 8.67 million tonne of oil equivalent (Mtoe) against the targeted energy saving of 6.886 Mtoe which is about 30% more than the target. This energy saving is equivalent to 31 million tonnes of CO2 emission reduction and monetary savings of INR 37685 Crores which encouraged investment of INR 24500 Crores.
For the trading of ESCerts, Central Electricity Regulatory Commission (CERC) is the Market Regulator and Bureau of Energy Efficiency is the Administrator. POSOCO (Power System Operation Corporation limited) has been appointed as for making DCs as eligible entities for trading of ESCerts and book-keeping of ESCerts. There are two Power Exchanges i.e. IEX and PXIL where trading of ESCerts shall take place. CERC has already approved the Procedure for Transaction of Energy Savings Certificates (ESCerts) on 14th Feb 2017.
The Parliamentary Standing Committee on Energy, Executive Committee on Climate Change under Prime Minister’s Office (PMO) and Group of Secretaries recommended to include DCs annually for accelerated coverage of DCs under PAT. Consequently, PAT scheme is being implemented on a rolling cycle basis where new DCs/sectors will be included every year. In view of this PAT cycle –III has started from 1st April, 2017. PAT Scheme in its third cycle seeks to achieve and overall energy consumption reduction of 1.06 MTOE for which SEC reduction targets have been assigned to 116 Designated Consumers from six sectors viz. Thermal Power Plant, Cement, Aluminum, Pulp & Paper, Iron & Steel and Textile. The energy consumption of these DCs is 35.00 MTOE.
As PAT scheme is now being implemented on a rolling cycle basis, i.e. new DCs will be notified every year. In the future cycles of the PAT scheme, it is envisaged that new sectors will be included such as Commercial Buildings, Petrochemicals and other sectors as listed in the Schedule of the Energy Conservation Act, 2001.
PAT Scheme is implemented in cycles of 3 years each where the Designated Consumers (DCs) are assigned SEC reduction targets. Upon verification of their performance in the assessment year by third party verifying agencies, the issuance or obligation to purchase ESCerts is carried out by BEE after scrutiny of the performance.
PAT Cycle 1: (PAT -1 Baseline Year: 2007-2010 & Assessment Year: 2014-15)
Central Government in consultation BEE vide notification dated 30 March 2012 had notified norms and energy saving targets for 478 industrial units from 8 industrial sectors in the PAT cycle-I, which was implemented during 2012-15. Under this PAT Cycle 1 seven Designated Consumers of Haryana were covered.
PAT cycle II (Baseline Year: 2014-15 & Assessment Year: 2018-19)
For PAT Cycle II, Central Government in consultation with BEE vide notification 31.03.2016 have defined new norms and energy saving targets for 621 industrial units from 11 sectors including existing 8 sectors and 3 new sectors (namely railways, petroleum refineries and electricity distribution companies). The total energy reduction target in PAT cycle-II is estimated to 8.869 Million Metric Tonne of Oil Equivalent. In PAT Cycle II 13 Designated Consumers of Haryana are covered.
PAT Cycle III (Baseline Year: 20015-16 & Assessment Year: 2019-20)
PAT cycle-III was notified on 31st March, 2017. PAT cycle -III seeks to achieve and overall energy consumption reduction of 1.06 MTOE for which targets have been notified to 116 Designated Consumers from six sectors viz. Thermal Power Plant, Cement, Aluminum, Pulp & Paper, Iron & Steel and Textile. In PAT Cycle III 1 Designated Consumers of Haryana are covered
PAT cycle Cycle IV ( Baseline Year: 2016-17 & Assessment Year: 2021-22)
PAT cycle –IV was notified on 28th March-2018. A total of 109 DCs with a total reduction target of 0.6998 MTOE was notified under PAT cycle -IV. The DCs notified under PAT cycle -IV are from 8 sectors consisting of 6 existing sectors and two new sectors. The new sectors are Petrochemicals and Buildings. In PAT Cycle IV 3 Designated Consumers of Haryana are covered
PAT cycle Cycle VI ( Baseline Year: 2018-19 & Assessment Year: 2022-2023)
PAT Cycle-VI has commenced with effect from 1st April 2020. Under PAT Cycle-VI, 135 DCs from six sectors, i.e. Cement, Commercial buildings (hotels), Iron and Steel, Petroleum Refinery, Pulp and Paper and Textiles, have been notified. With implementation of PAT cycle –VI, it is expected to achieve a total energy savings of 1.277 MTOE. In PAT Cycle VI 8 Designated Consumers of Haryana are covered
In PAT cycle Cycle VII &VIIA ( Baseline Year: 2019-20 & Assessment Year: 2024-25)
PAT Cycle-VII has commenced with effect from 28th Oct 2021. Under PAT Cycle-VII, 509 DCs from sectors, i.e. Locomotive, Coach , Wheel, A. Zonal Railways ,Cement, Commercial buildings (hotels), Iron and Steel, Petroleum Refinery, Pulp and Paper and Textiles, have been notified. With implementation of PAT cycle –VII,. . In PAT Cycle VII 10 Designated Consumers of Haryana are covered