Estimates of energy savings from energy efficiency improvements in India using Index Decomposition Analysis

Abstract

Energy efficiency plays a central role in climate change mitigation policies. Countries are using different methods to estimate energy savings from energy efficiency improvements. Improved methods to measure energy efficiency savings are adopted mainly in countries with mandatory energy efficiency targets. They use bottom-up and top-down methods to enhance the reliability of savings estimates. India has implemented various energy efficiency measures, and the impact of most of the schemes is estimated using the simplified deemed savings bottom-up approach. Index Decomposition Analysis is a top-down approach, but its use in India is limited due to a lack of reliable national energy balances. This study uses India’s energy balances from International Energy Agency to estimate the energy efficiency savings in India during 2011–19. It is found that the IDA estimates are lower than the government’s deemed savings estimates. The underlying assumptions in the simplified deemed savings approach may overestimate savings, or savings from index decomposition analysis may be underestimated due to data limitations. Improved methods and reliable and timely data is essential for measuring energy savings from energy efficiency. National-level targets on energy efficiency can push improvements in energy savings measurement techniques. The targets can also address several barriers in the energy efficiency markets.