India has experienced significant growth in electricity generation over the past two decades, with a notable increase in renewable energy sources in recent years. However, the country still struggles to meet its peak power demand, with a deficit of around 5% in FY24, up from 0.69% in FY20. This highlights the constraints in power supply, particularly with the time-consuming process of adding new power production capacity, especially from fossil fuels. As India aims to integrate more renewable energy into the grid, it is essential to focus on enhancing energy efficiency to reduce power demand.
The country’s energy efficiency scheme, UJALA, launched a decade ago, has been successful in promoting the use of energy-efficient LED bulbs, bringing down their price from ₹500 to ₹70. The scheme has led to the distribution of over 37 crore LED bulbs and enabled the sale of 407 crore more, resulting in significant cost savings for households. Moreover, estimates suggest that UJALA has helped India save over $10 billion and avoid building 9,500 MW of new generation capacity, equivalent to 19 new coal-fired power plants.
However, despite these efforts, India’s energy demands continue to rise, driven by rapid urbanization and increasing per capita energy consumption. The country is now the third-largest power consumer globally, with 70% of its energy output still coming from coal. To address this, there is a need for greater energy efficiency measures across various sectors, including buildings, home appliances, and micro, small, and medium enterprises (MSMEs).
The International Energy Agency notes that between 2000 and 2018, energy efficiency improvements helped India avoid an additional 15% of energy demand and 300 million tons of CO2 emissions. To build on this progress, the government should implement more stringent energy efficiency mandates and incentives to encourage the adoption of energy-efficient technologies and practices. By doing so, India can reduce its peak power demand, mitigate climate change, and achieve a more sustainable energy future. With the country planning to add another 90 GW of coal-based capacity by 2032, it is crucial to prioritize energy efficiency to minimize the environmental impact of its growing energy needs.