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India Mandates the Use of Clean Energy, Carbon Trading

The Government of India has passed the Energy Conservation (Amendment) Bill, 2022, mandating the use of clean energy in the country. The Bill, which is now an Act, proposed to amend the Energy Conservation Act of 2001.

Key Features of the Act

1. Mandatory use of Clean Energy

According to the Act, the central government is given the authority to set minimum non-fossil energy consumption guidelines for specified users. Industries like mining, steel, cement, textile, chemicals, and petrochemicals are designated users, as are the transportation sector, including railroads, and commercial structures, as listed in the schedule.

2. Opening Carbon Market

The Act gives the union government the authority to designate a carbon credit trading system. A tradable permit to emit a certain amount of carbon dioxide or other greenhouse gases is implied by a carbon credit.

3. Energy Conservation Code for Buildings

The Act empowers the union government with authority to establish standards for energy efficiency and conservation, the use of renewable energy sources, and other criteria for green buildings. According to the Act, commercial buildings that were built after the Code’s announcement and that had a minimum connected load of 100 kW or contract load of 120-kilovolt ampere are subject to the energy conservation code (kVA).
Union Minister for New and Renewable Energy, Raj Kumar Singh, said that it is a matter of pride for all the citizens the way India has moved on energy transition and enhanced its renewable energy capacity. He said the Energy Ministers of the various countries who have visited India are impressed with the progress in the renewable energy sector.
He further stated that no developed country has made as much progress as India in energy transition and climate action.  Singh informed the House that during 2015 at COP-21, as part of its Nationally determined contributions, NDCs, India had committed to achieving 40 per cent of its installed electricity capacity from non-fossil energy sources by 2030. He said the country achieved this target in November 2021, nine years ahead of the set target.

Reactions of the Members of Parliament

Around 36 members of the Rajya Sabha took part in the discussion on the bill on Monday. Replying to the discussion on the bill, power minister RK Singh said that India has the potential to emerge as the leader in new areas of green buildings and green hydrogen.
According to him, the housing sector now consumes 24% of all energy, while the government’s law only targets large commercial buildings with a load capacity of 100KW.
He said that the government intended to employ a green hydrogen consumption duty to compel the use of green hydrogen in businesses, including cement, steel, fertiliser, and refineries. A committee led by the cabinet secretary would determine the obligation target.
The administration has received plaudits from P Wilson of the DMK for its efforts to reduce carbon emissions and save the environment.
But, he added, some of Bill’s provisions need to be re-examined. This Bill, according to Sandeep Kumar Pathak of the AAP, is a futuristic step that emphasises the need to take action to build the necessary infrastructure and draw investment in the field of renewable energy.
According to Manoj Kumar Jha of RJD, the Bill makes no mention of calculating emissions. The Center must grant states the authority to manage strategies and practises for energy saving, according to Dr V Sivadasan of the CPI (M).
Congressman Shaktisinh Gohil stated that the bill makes no mention of the carbon trading regulatory framework. The adoption of LED bulbs is only one of the government’s many energy-saving initiatives, according to Ram Chander Jangra of the BJP, who called this legislation crucial.