Perform, Achieve and Trade (PAT) Scheme

Q What is the context ?

A A recent report by the Centre for Science and Environment (CSE) has attributed the inefficiency of the PAT scheme to non-transparency, loose targets and overlooked deadlines.

Q What is PAT Scheme ?

 A

• Perform Achieve and Trade (PAT) scheme is a flagship program of Bureau of Energy Efficiency under the National Mission for Enhanced Energy Efficiency (NMEEE).
• NMEEE is one of the eight national missions under the National Action Plan on Climate Change (NAPCC) launched by the Government of India in the year 2008

Q What are key features of the scheme?
A

• PAT is a market-based compliance mechanism to accelerate improvements in energy efficiency in energy-intensive industries.
• The energy savings achieved by notified industries is converted into tradable instruments called Energy Saving Certificates (ESCerts).
• The ESCerts after issuance by the Bureau of Energy Efficiency are traded at Power Exchanges.

Q What is PAT cycle?

A

• The government shortlists industries and restricts the amount of energy they can consume and defines a time limit of three years by when this restriction should be met as part of PAT.
• These three years of time are called one PAT cycle.
• The industries are chosen after in-depth, sector-wise analysis by the government.
• Industries that participate in this scheme are called designated consumers (DC).
• Those that overachieve their targets are issued energy savings certificates (ESCerts) that can be traded with industries that have not achieved their targets.
• Non-achievers have to buy the ESCerts after the three years for compliance.

Q What are various PAT cycles ?

A

• PAT covered about 13 energy-intensive sectors
• Sectors included are thermal power plants (TPP), cement, aluminium, iron and steel, pulp and paper, fertilizer, chlor-alkali, petroleum refineries, petrochemicals, distribution companies, railways, textile and commercial buildings (hotels and airports)
• Announcements for six cycles since 2012 have been made so far