To Promote Clean Energy Consumption, Power Ministry Proposes Amendment To Energy Conservation Act, 2001

India stands at the forefront of addressing climate change and has committed to reducing emission intensity by 33-35% in 2030.

Planet Outlook
November 05, 2021
To Promote Clean Energy Consumption, Power Ministry Proposes Amendment To Energy Conservation Act, 2001

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 in the end-use sectors.

Ministry of Power has prepared amendments, after consultations with stakeholders. The proposal includes defining the 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 a carbon saving certificate. 

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 the 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 the 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% in 2030 against the levels of 2005. Ministry of Power highlighted that India is committed to achieving more than 40 per cent 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 the economy. The provisions would facilitate the promotion of green Hydrogen as an alternative to the existing fossil fuels used by the Industries.

The additional incentives in the form of Carbon credits against the deployment of clean technologies will result in private sector involvement in climate actions. The proposal also includes expanding the scope of the Act to include larger Residential buildings, with an aim to promote Sustainable Habitat.

Ministry of Power has stated that the need for energy is inevitable and with the changing business landscape, it is has become even more imperative to address the nation’s need to become energy-efficient without putting further pressure on the environment. With the amendment to EC Act, 2001, the focus is to empower institutions to contribute to our Paris commitments and fully implement our NDCs in a timely manner.