Guidelines for the Designated Consumers under the PAT Mechanism

Posted on July 8, 2011 by

The Perform Achieve and Trade scheme is a market-based mechanism to enhance energy efficiency in large energy-intensive industries. It is a kind of incentive model proposed and implemented by BEE under EC Act 2001.

The facilities that come under the large scale energy-intensive industries and included in the EC Act 2001 are known as ‘Designated Consumers (DC)’. The list of DCs has been published by BEE. Only the industries that included in the BEE list are included in PAT mechanism. Click here to know more about the Designated Consumers.

  1. Conduct a detailed energy audit of plant through a certified energy auditing agency (or auditor) as per the BEE guidelines
  2. Determine the specific energy consumption (SEC) for the plant based on the audit conducted. It shall be baseline for PAT scheme.
  3. Submit the energy audit report and SEC to the DENA. DENA is an organization that does the monitoring and evaluation process at free of charge (Fees can be incurred in future).
  4. Set SEC reduction targets for the plant to be achieved in three years time from 2011 to 2014. The targets should be in-line with the guideline of BEE.
  5. Identify the energy efficiency measure and energy conservation initiatives to meet the set SEC reduction targets
  6. In case the SEC reduction is greater than set three year targets, earn ESCerts on additional SEC reduction. These ESCrerts can be traded to earn additional revenue. The issuance of ESCerts is administered by DENA
  7. In case the SEC reduction targets are not achieved, buy the ESCerts for the deficit.
  8. If DC does not meet the SEC targets or do not buy ESCerts will have to penalty.
  9. Every year DC should file the report and review its SEC reduction progress.
  10. The buyers for these ESCerts will be the entities that will not meet their energy efficiency targets and will need to buy these ESCerts to meet the energy efficiency norms.

The whole PAT Activity is Continual Improvement. As of now the target setting activity is underway. ESCerts trading mechanism is expected to be operational by 2014. PAT scheme creates energy efficiency targets to be met and incentivizes businesses achieving higher energy efficiency with tradable energy saving certificates (ESCerts).

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