Government passes energy conservation bill

by Shahkar Abidi 09 Aug 2022

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A bill  seeking  to amend the Energy Conservation Act, 2001 was passed by Lok Sabha on Monday.  

The amended regulation  provides for the regulation of energy consumption by equipment, appliances, buildings,  industries and expands the scope to include automobiles. Further, the  failure to comply with standards will be punishable with a penalty of up to Rs 10 lakh and OEMs, in violation of fuel consumption norms. will be liable to pay a penalty of up to Rs 50,000 per unit of vehicles sold. 

The Act empowers the central government to specify  consumption standards of energy consumption from non-fossil sources.  Different consumption thresholds may be specified for different non-fossil sources and consumer categories.  Designated consumers include industries such as mining, steel, cement, textile, chemicals, and petrochemicals, transport sector including Railways, and  commercial buildings, as specified in the schedule.  

Provided further clarity in terms of penalty, the Act states that if the manufacturer of a vehicle fails to comply with the fuel consumption norms, then it  shall also be liable to pay an additional penalty per unit of vehicles sold in the corresponding year, as follows, viz; Rs 25,000 per vehicle  up to 0.2 litres per 100km; Rs 50,000 per vehicle for non-compliance of norms above 0.2 litres per 100km.

"With the passage of time, and in the context of energy transition with special focus on promotion of new and renewable energy and National Green Hydrogen Mission, a need has arisen to further amend the said Act to—
(i) facilitate the achievement of “Panchamrit”— as five nectar elements presented by India in COP-26 in Glasgow 2021;
(ii) promote renewable energy and development of domestic Carbon market to battle climate change;
(iii) introduce new concepts such as carbon trading and mandate use of non-fossil sources to ensure faster decarbonization of Indian economy and help in achieving sustainable development goals in line with the Paris Agreement and various other actions related to climate change" the statement of the object of the bill reads. 



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