Industrial Automation Magazine India

Businesses are still uncertain about the untapped economic potential for energy savings

Published on : Friday 01-07-2022

Sanjeev Arora, President, Motion Business Area, ABB India Ltd.

Is there a dichotomy in the fact that cost is said to be a major barrier and at the same time cost-saving is the most important reason to opt for energy efficiency measures?
The big picture is what counts while investing in energy efficiency. Many companies opt for low-efficient technologies as they want to save on their upfront costs. For example, purchasing low-efficient IE2 motors may initially seem less expensive. However, by choosing super premium efficiency motors (IE3, IE4,) companies can save money over the lifetime of the equipment and reduce their total cost of ownership. (TCO) Those who understand the long-term benefits of energy efficiency have started their transition to more reliable, energy-efficient solutions. The results from our recent survey show that in India, 72% are upgrading their equipment to best-in-class energy efficiency ratings and about 58% are carrying out audits to identify key areas for improvement. 

The survey has mentioned a lack of information about energy efficiency measures by almost 50% of the respondents. How can this issue be addressed?
Despite the efforts at various levels among the corporates, industry bodies, and government to raise awareness about energy efficiency, businesses are still uncertain about the untapped economic potential for energy savings available to them, as well as the existing technologies available to exploit this potential. A good starting point would be for companies to integrate energy efficiency into their vision and operational strategy. Setting energy-efficiency targets can help engage people in identifying and pursuing energy savings opportunities for their projects and ensure management visibility. Well-defined goals can signal top-level support and promote long-term commitment to investing in energy efficiency. 

One of the main impediments to energy efficiency measures in India is said to be the lack of effective implementation on the demand side. Is this situation changing?
Over the last few years, there has been a gradual rise in demand for energy-efficient motors after the government introduced regulations requiring the industry to install only IE2 or higher efficiency motors. Before the regulations were introduced, the market demand was not very encouraging. However, companies are now becoming increasingly aware of the benefits of energy efficiency and are focused on saving costs. Today, IE3 and IE4 motors account for nearly 30% of all motors manufactured in India. Industries should go beyond regulatory standards and replace the existing installed base of low-efficiency motors with high-efficiency versions. In the past decade, we have also witnessed investments for products running on renewable energy like off-grid solar pumps and grid-tie solar pump drives that can help in meeting energy demand for niche segments such as agricultural irrigation, forestry, farming, water supply for islands, wastewater treatment, and many others. The government is also promoting water pumping via renewable power in various sectors via KUSUM Schemes.

Energy-efficient equipment like motors and drives are available yet the solutions are not widely implemented despite short periods of RoI. Can regulatory pressure help? 

India has already taken some considerable measures toward decarbonising its industrial sector and the country’s per capita carbon emissions remain much below the global average. Initiatives like Perform Achieve and Trade, Market Transformation for Energy Efficiency (MTEE), etc., have brought about tangible results, but there is still more scope for policy intervention. While countries like China and the EU have upgraded their Minimum Energy Performance Standards to IE3, India's minimum efficiency level remains at IE2. The country should raise its energy efficiency benchmark and encourage the use of higher efficiency motors that meet global standards.

As per industry estimation, only 23% of the world’s industrial motors are presently equipped with variable-speed drives, and this figure is expected to grow to 26% over the next five years. Combining VSDs with motors will bring considerable benefits in energy savings.

Aside from regulatory measures, incentivizing the use of energy-efficient technologies will encourage more companies to make the switch. 

How effective is the energy audit – both from the users as well as the regulatory end?
The first step in understanding any organisation's energy consumption is to conduct an energy audit. By conducting periodic audits, companies can identify areas where they can avoid wastage, curb energy use, save on costs, and lower their carbon footprint. A good quality audit will analyse historical energy use and find potential issues using statistical methods. Through this method, businesses can understand where their energy is utilised the most and focus on areas for improvement. The cost-benefit analysis of the audit report would help decision-makers prioritise energy-saving opportunities and evaluate them as investments. These indicators can include rate of return, net present value, cash flow analysis, and payback.

Are energy-inefficient buildings the elephant in the room that no one is acknowledging? What about the legacy structures? 
Buildings consume one-third of the electricity in India and are a major emitter of greenhouse gases. The recent rise in power outages, blackouts, and coal shortage is a wake-up call for all of us to monitor and manage energy effectively. Holding on to archaic technologies means we are resisting progress and wasting resources. Modern buildings require smart HVAC systems that create comfortable, healthy, and safe environments for the occupants while minimising energy consumption and increasing sustainability. HVAC systems have high operating costs since they consume on average 30 to 70 percent of the building’s energy. Making them energy efficient should be a clear priority. Powering our buildings through renewable energy can also make a huge difference in reducing carbon footprint. At ABB, we have taken many sustainability measures such as deploying in-house motors and drives, digital technologies and using solar energy to make our buildings smarter and more energy-efficient.  

Is it time for companies to create a dedicated Energy Efficiency Officer truly empowered with a mandate?
With many companies putting sustainability higher upon their agenda, creating a dedicated Energy Efficiency Officer will undoubtedly strengthen commitment and help in closing existing gaps in emissions reduction. This person can act as a change agent, envisioning new opportunities and setting targets for improving the organisation's energy efficiency.