Using national energy efficiency programs with upstream incentives to accelerate market transformation for super-efficient appliances in India

摘要

Utility-administered demand-side management (DSM) programsin India have been slow in achieving the shift to efficientappliances. Some of the reasons are: (1) lack of expertise inDSM in utilities and regulatory commissions; (2) utilities beingpreoccupied with other issues such as electricity shortages andhigh distribution losses; (3) reluctance of most utilities to proposeand design programs on their own. An alternate approachis required to bring about rapid gains in energy efficiency ofappliances.One promising approach is national programs (NPs) with afocus on market transformation through incentives to manufacturersto develop and sell super-efficient products. The designof NPs and the monitoring and evaluation (M&E) plans,and much of the implementation will be done by a nationalagency, considerably reducing the burden on utilities and stateregulators and bypassing many of the difficulties with utilityadministeredprograms. The funding for the incentives cancome from ratepayers or taxpayers.NPs are expected to have several other benefits: (1) reducedtransaction costs because interactions will be with a smallnumber of manufacturers rather than millions of consumers;(2) rapid ratcheting-up of efficiency standards; (3) upstreamincentives (to offset higher manufacturing costs) that are considerablysmaller than customer rebates (to offset higher retailprices); (4) easier monitoring and evaluation; and (5) possibilityof introducing products that are not only super-efficient butalso better suited to Indian conditions.NPs have received in-principle approvals from the relevantgovernment agencies. The authors are working with the governmentagencies to develop the institutional framework,financing mechanism, and monitoring and evaluation thatare described in the paper. India’s experience with NPs maybe relevant for other developing countries that are striving tobring about a market transformation to efficient appliancesbut have limited expert resources in energy efficiency programs.