Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Industry / Energy/  Govt targets $8.9 billion in energy efficiency cost savings
BackBack

Govt targets $8.9 billion in energy efficiency cost savings

The plan is crucial to fulfilling government's promise of providing around-the-clock electricity to every household by 2019

The LED bulbs program is expected to result in savings of about 100 billion kilowatt hours a year, while replacing half of the 20 million irrigation pumps will result in annual savings of 25 billion kilowatt hours. Photo: BloombergPremium
The LED bulbs program is expected to result in savings of about 100 billion kilowatt hours a year, while replacing half of the 20 million irrigation pumps will result in annual savings of 25 billion kilowatt hours. Photo: Bloomberg

New Delhi: India’s plan to replace energy-intensive appliances with more efficient designs is expected to save as much as Rs60,000 crore ($8.9 billion) a year, according to the head of the government arm spearheading the country’s drive.

The federal power ministry’s plan to replace incandescent lights with LED bulbs and use energy-efficient irrigation pumps, fans and air conditioners can cut about 30 gigawatts of peak-hour generation demand in three years, said Saurabh Kumar, managing director of Energy Efficiency Services Ltd., a joint venture of four government-run power companies. That is equivalent to fivefold the peak summer needs of the capital New Delhi.

Prime Minister Narendra Modi has emphasized efficient energy use to conserve resources and help curb environmental damage in a fossil-fuel driven economy. The plan is crucial to fulfilling his promise of providing around-the-clock electricity to every household by 2019.

Cost-saving estimates are calculated using a power price of Rs4 per kilowatt hour. The LED bulbs program is expected to result in savings of about 100 billion kilowatt hours a year, while replacing half of the 20 million irrigation pumps will result in annual savings of 25 billion kilowatt hours. Another 25 billion kilowatt hours a year of savings are expected from efficient air-conditioners, Kumar said.

Modi’s goal of universal power is hamstrung by money-losing state distributors that struggle to pay for electricity, which ends up resulting in outages and idle generation capacity. The nation’s coal-fired plants used an average 68% of their capacity in April, according to data from the power ministry’s Central electricity Authority. The efficiency drive adds another challenge for the power producers.

“Clearly the space for conventional power producers in India is shrinking," said Debasish Mishra, a partner with Deloitte Touche Tohmatsu LLP in Mumbai. “It’s possible that we may see hardly any thermal capacity addition in the next five years." Bloomberg

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 29 Jun 2016, 12:24 PM IST
Next Story footLogo
Recommended For You
Energy Stocks
₹1,824.250.53%
₹166.250.9%
₹516.82.34%
₹88.561.21%
₹330.651.6%
Switch to the Mint app for fast and personalized news - Get App