Power ministry proposes amendment to Energy Conservation Act, 2001

Amendments proposed also address the global challenge of climate change and include defining minimum share of renewable energy in the overall consumption by industrial units.

Amidst the growing energy needs and changing global climate landscape, the Government of India has identified new areas to achieve higher levels of penetration of renewable energy by proposing certain amendments to Energy Conservation Act, 2001. The objective will be to enhance demand for renewable energy at the end-use sectors such as Industry, buildings, transport etc.

The ministry of power has prepared amendments, after consultations with stakeholders. The proposal includes defining a minimum share of renewable energy in the overall consumption by the industrial units or any establishment. There will be provision to incentivise efforts on using clean energy sources by means of carbon saving certificate. Power Minister  R.K. Singh, reviewed the proposed amendments recently and directed to seek comments and suggestions from concerned line ministries/departments and state governments. Accordingly, a meeting was held by Alok Kumar, Secretary (Power) with the stakeholders ministries and organisations on 28th October 2021 to give a final shape to the proposed amendments in the EC Act.

To review the act in detail, four stakeholder consultation meetings (one national consultation workshop and three regional consultations) were conducted with various stakeholders to discuss and receive inputs on the possible amendments. Further, to the discussion and stakeholder consultations, the amendments have been proposed to strengthen the institutions originally envisaged under the act. The proposed amendments would facilitate the development of carbon market in India and prescribe minimum consumption of renewable energy either as direct consumption or indirect use through the grid. This will help in reduction of fossil fuel-based energy consumption and carbon emission to the atmosphere.

India stands at the forefront of addressing climate change and has committed to an ambitious Nationally Determined Contributions (NDCs) of reducing emission intensity by 33-35 percent in 2030 against the levels of 2005.

The Ministry highlighted that India is committed to achieve more than 40 percent cumulative electric power installed capacity from non-fossil-fuel energy resources by 2030. Furthermore, by adopting energy efficiency measures, India holds the potential to reduce about 550 MtCO2 by 2030. The proposed changes to the EC act will boost the adoption of clean technologies in various sectors of economy. The provisions would facilitate promotion of green Hydrogen as an alternative to the existing fossil fuels used by the industries.