Chennai: The Bureau of Energy Efficiency will finalise the details of mandatory energy efficiency targets for energy-intensive industries by the year-end, according to Dr Ajay Mathur, Director-General, BEE.

This would enable the launch of the first phase of Perform-Achieve-Trade (PAT) mechanism under Energy Conservation Act 2001 as scheduled next April.

PAT norms to provide for energy efficiency targets are applicable to industrial units in nine sectors. These are: aluminium, cement, chlor-alkali, pulp and paper, fertilisers, power, generation plant, steel, railways and textiles. PAT will set targets of energy efficiency, provide for incentives to those that comply and penalties for the inefficient. The Energy Conservation Act is being amended to provide for stiff penalties.

Over 700 units in these sectors referred to as designated consumers account for the usage of about 230 million tonne of oil-equivalent annually. This is more than half the total fossil fuel consumption of the country.

PAT is an initiative under the National Mission on Enhanced Energy Efficiency for a market-based mechanism to enhance cost effectiveness of improvements in energy efficiency through tradable energy savings certificates. The less efficient can buy these certificates to offset the shortfall.

Efficiency targets

Addressing a workshop on PAT organised by the Confederation of Indian Industry here today, Dr Mathur said the exercise of setting appropriate energy efficiency targets in the form of specific energy consumption is on. Baseline studies are to be completed by October and protocols for a trading mechanism in place in September. Energy Savings Certificates can be traded on special trading platforms on power exchanges. The first phase of PAT will be in place between April 2011 and March 2014.

Work is on to set specific energy consumption targets, systems and process for PAT, institutional arrangement for PAT, including Energy Savings Certificates.