The current investment potential for electricity efficiency in India could top USD $6 billion, according this report commissioned by APP and USAID. The authors note that investments in industrial energy efficiency represent a low-risk strategy with attractive rates of return in the near- to medium-term. These investments also hold the potential to weather significant market fluctuations because they are provided to companies that have increased incentives to reduce energy costs during economic downturns to enhance competiveness. The report reviews the current status of energy efficiency investments in India, highlights promising developments, and identifies challenges concerning electricity tariffs, policy implementation, regulatory directives, financing mechanisms and initiatives. The report details several barriers to investments and describes available financial instruments to overcome these barriers. The recommendations underscore the importance of establishing systematic data collection mechanisms, training bank and financial officers, fast-tracking effective approaches for financing demand-side management, and closing the gap between energy efficiency audits and implementation. With the support of APP and USAID, the ECO-Asia Clean Development and Climate Program is already helping two Indian states establish conservation funds to finance energy efficiency projects.
Read the full report from here (PDF)