CII to push for energy audits of industrial units

The fact that India is an energy-deficit state is no secret, since capacity additions have not been able to keep pace with the burgeoning demand for electricity from different sectors.

While supply-side constraints have to be primarily managed by the government, industry wants to chip in with demand-side management and energy conservation, to cut consumption.

The Confederation of Indian Industry (CII) wants to give a vigorous push to the concept of 'energy audits' of industrial units and buildings to make them energy-efficient through judicious and optimum usage of electricity.

Almost 80 per cent of CII members belong to the micro, small and medium enterprises (MSME) sector.

"We are working towards reducing the energy footprint of our MSME members," Zubin J Irani, CII's Northern Region chairman, told Business Standard here.

CII has a dedicated arm for conducting energy audits and facilitating smart energy management in Chandigarh.

Buildings and factories, transport and the industrial sector are the major sources of energy consumption. According to an estimate, buildings and factories alone account for 34 per of energy consumption in India.

With growing awareness as well as need for smarter energy management, India today has the second-largest green building footprint in the world after the USA.

An energy audit comprises an inspection of an industrial unit/building by a team of experts. After a thorough survey, the team gives suggestions to the unit for energy management, which may range from changing or upgrading the electrical components and physical infrastructure to minor modifications in the layout.

"The energy audit not only helps cut consumption, thereby decreasing the load on the grid, but makes pure business sense as it reduces energy cost for the company, which can easily recoup its investment in the next two to three years," Irani claimed.

He said that a CII energy audit had helped a company save energy costs by Rs 4.5 crore.

MSMEs in UP have also been open to the idea of tapping solar energy to deal with persistent power cuts and insulate themselves against rising electricity tariffs. The 30 per cent Central subsidy provided on solar power installations has only added to the attractiveness of the proposition.

After the subsidy, a typical solar power system costs about Rs 1.4 lakh per kw capacity, although the final price would depend mainly on the battery strength.

A typical solar power system recoups its cost in six to seven years if the company claims income tax benefits by disclosing its balance sheet. Without such benefits also, it can recover the cost in 10 years.

The life of a solar power system is about 25 years. The battery needs to be changed every five years, while the solar panels need to have cleaner surfaces for greater radiation.