Cabinet okays energy saving plan

The cabinet has approved the National Action Plan on Energy Efficiency and Conservation 2023-30 with a focus on saving $6.4 billion due to the enforcement of energy efficiency audits along with several other features.

Earlier, the Cabinet Committee on Energy, chaired by Prime Minister Shehbaz Sharif, gave its nod for the action plan.

In addition to the action plan, the cabinet has also green-lighted the Energy Conservation Building Code 2023 and Electric Appliances Regulations. The National Energy Efficiency and Conservation Authority has been mandated to initiate, catalyse and coordinate all energy conservation activities across all sectors of the economy.

The National Energy Efficiency and Conservation Policy stresses need for guiding Pakistan towards a culture of conserving and efficiently utilising energy resources to achieve sustainable development.

The policy is aimed at achieving the energy saving target of 9 million tons of oil equivalent (MTOE) by 2030, leading to a reduction of 35 MT of carbon dioxide emissions.

Through its market-enabling approach, the conservation policy anticipates an annual monetary saving of $6.4 billion to the national exchequer post-2030.

The policy focuses on deep-rooted institutionalisation, operationalisation and implementation of energy efficiency and conservation programme across various sectors.

It includes sector-specific measures for the industry, buildings, transport, energy and agriculture. It outlines mechanisms for enforcing energy efficiency and conservation regulations, along with guidelines for coordination with provincial governments and regions.

The National Energy Efficiency and Conservation Policy 2023 has several regulatory features.

It focuses on ensuring compliance with the minimum energy performance standards and labeling regimes for electric and gas appliances, equipment and products.

It is aimed at developing and enforcing energy conservation building codes and introducing mandatory energy audits for designated consumer facilities and business operations.

It makes mandatory the accreditation of testing laboratories and establishment of industrial assessment centres in collaboration with universities. It also makes mandatory the procurement of energy-efficient equipment in public procurements through the Minimum Energy Performance Standards (MEPS).

Other features include evaluation of energy-efficient appliances during load profiling for electric and gas connections in commercial, household, industrial and agriculture sectors.

It enforces a ban on manufacturing the inefficient lighting products like incandescent bulbs, high-intensity discharge lamps, and fluorescent lamps and sets benchmarks for energy consumption, investment requirements for efficient equipment, and criteria for designated consumers.

It envisages the establishment of Energy Conservation Tribunal (ECT) for complaint redressal and issue resolution and for inquiry or investigation into wasteful energy use across key sectors.

Policy interventions include definition and notification of energy consumption thresholds for designated consumers and mechanisms for mandatory energy-saving plans with targets and timelines in key sectors.

It calls for a certification regime for energy auditors and managers and the development of a “Super ESCO Model” to de-risk investments in energy efficiency and conservation projects and mobilise private sector capital.

It is also aimed at creating Energy Information House (EIH) for energy information and its dissemination at the federal and provincial headquarters. It focuses on collaboration with provincial energy departments, utilities, regulatory bodies, financial institutions, and ministries for policy implementation.

Concessional financing for retrofitting buildings, appliances and industrial facilities are also part of the policy which includes the issuance of energy-saving certificates and bonds.

Development of fiscal incentive schemes to promote localisation, production and use of energy-efficient products are other features of the policy and integration of energy efficiency and conservation into the national and provincial policies, plans and programmes.

It underlines need for promotion of vehicle-free weekends, vehicle restriction days and daylight savings through awareness campaigns and formulation of a national action plan.

In total, the energy efficiency plan offers an investment potential of $8 billion to achieve the SDG 7 objectives. The policy sets the energy saving and greenhouse gas emission reduction targets of 9 MTOE and 35 MTCo2e respectively.