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com
Trading of ESCerts on Power Exchanges
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NAPCC
National Solar Mission
National Mission for Enhanced
Energy Efficiency (NMEEE)
Perform, Achieve, Trade (PAT)
Market Transformation for energy
efficiency
Energy Efficiency Financing
Platform
Framework for Energy Efficient
Economic Development
National Mission on Sustainable
Habitat
National Water Mission
National mission for sustaining
the Himalayan Ecosystem
National Mission for a Green India
National Mission for Sustainable
Growth
National Mission for Strategic
Knowledge for climate
Genesis of PAT scheme - NAPCC
National Action Plan on Climate Change
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BEE
MoP
State
Designated
Agency
Energy
Auditor
Power
Exchange
Designated
Consumer
Stakeholders under the PAT scheme
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PAT Sector wise Energy Consumption and
Targets under Cycle 1 ( 2012 2015)
Specific Energy Consumption (SEC) = net energy input into
the designated consumers boundary / Total qty of output
exported from the designated consumers boundary
Sr # Sector # of DCs in Cycle 1 Targets under Cycle 1
(million TOE)
1 Aluminium 10 0.456
2 Cement 85 0.816
3 Chlor-Alkali 22 0.054
4 Fertilizer 29 0.478
5 Iron & Steel 67 1.486
6 Pulp & Paper 31 0.119
7 Textile 90 0.066
8 Thermal Power Plants 144 3.211
Total 478 6.686
Source: BEE
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Baseline Specific
energy
consumption
(SEC)
Target SEC
Set Targets
Under
achievement
Over
achievement
Monitoring and
Verification
Market based
trading on Power
exchanges
Trading of
Escerts
Reward over achiever
Penalize under performer
MARKET BASED MECHANISM
PAT is a market based mechanism designed
to enhance energy efficiency
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Power Exchanges will provide the trading
platform for ESCerts
Saving Target
Baseline
SEC
Target
SEC
Achieved SEC
Scenario
1
Scenario
2
Compliance
Issued Escerts
Purchase
Escerts
Penalty
Energy Saving Certificates (ESCerts) issued by Ministry of Power/BEE
1 ESCert = 1 ton of oil equivalent of (toe) energy saving achieved by
the designated consumer, over and above the target savings.
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ESCert Snapshot
Mandatory Compliance
Designated Consumers Target Entities
Industries not achieving target Buyers
Industries achieving beyond target Sellers
6.6 million toe for 1
st
Cycle
Target
Cap and Trade Mechanism
3 yrs Phase Cycle
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ESCert Snapshot
1 ESCert = 1 MTOE (Metric Tonne of Oil
Equivalent
ESCerts
Power Exchange only* Trading Platform
To be finalized (Once a month)*
Trading Frequency
Double Sided Closed Auction*
Price Determination
As per Energy Conservation Act, 2001
(Link with market value of oil equivalent)
Penalty
Allowed for two consecutive cycles* Banking
3 Years for DCs Compliance Period
* proposed
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ESCerts: Proposed Exchange Trading Mechanism
ESCerts will be held in electronic form
Registered with a depository
System Registry would maintain record of all transactions
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ESCerts: Proposed Exchange Trading Mechanism
IEX would be a one stop shop for buying and selling:
1. ESCerts
2. Renewable Energy Certificates
3. Electricity
DCs would have choice of becoming a member on the
exchange or client of the member of the exchange
Financial settlement will be through electronic bank interfaces
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ESCert Proposed Exchange Trading Mechanism
Seller
Buyer
IEX
Bank
A/c
Deposit fund
for trading
Confirm Margin
Requirement
S
u
b
m
i
t
s

B
i
d

f
o
r

t
r
a
d
i
n
g
Bids are
accumulated
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ESCert Proposed Exchange Trading Mechanism
Seller
Buyer
Participants
IEX
Bank
A/c
MCV & MCP
calculated post
bidding session
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ESCert Proposed Exchange Trading Mechanism
Seller
Buyer
Participants
IEX
Bank
A/c
Invoice/ Credit Note
Financial
Settlement
through
Bank A/c
ESCerts
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Why Electricity Exchanges for ESCerts
Transparent & efficient platform
Electronically accessible market place
Well established spot market for electricity & RECs
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Thank You !!!
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