Commercial and Industrial (C&I) sector is the largest electricity consumer in India and is envisaged to play a pivotal role in India’s National Action Plan on Climate Change (NAPCC). Although a lot of interest is seen from the C&I sector for procurement of renewable energy, this existing RE potential is still to be tapped.
As part of its commitment to the Paris Agreement, India has set ambitious targets of achieving 175 GW of RE capacity by 2022. The C&I sector has an opportunity to contribute to these national goals while also achieving log-term self-sustainability. This is possible as renewable power is now affordable and easily accessible and the renewable energy ecosystem is well developed. Renewable power also enhances the brand image of organizations as producers or consumers of clean energy highlighting their contributions in creating a sustainable world.
PRAMAAN rating lays emphasis on clean energy transition for organizations to reduce their power procurement costs, adhere to legislation, and increase sustainability.
To act as a catalyst to accelerate RE deployment within the C&I sector, which would facilitate India Inc.'s transition to RE in alignment with the national climate commitments.
All commercial and industrial entities including medium, small and micro enterprises (MSMEs), large corporates interested in knowing their RE transition progress and readiness can participate in the PRAMAAN rating
PRAMAAN provides a set of indicators for an organization to assess its progress in moving towards a low-carbon future and can be used as a framework to prioritize electricity options, assess risks, identify opportunities, set targets, and develop a sustainable energy road map
PRAMAAN is a rating system that helps organizations implement an effective energy management road map.
Renewable energy is not just another source of power procurement; it is becoming an essential requirement for sustainable growth. PRAMAAN helps in identifying the organization's energy usage profile and provides guidelines for reducing its power consumption, emissions, and costs. It outlines a process that helps a corporate to reduce its electricity cost in the long term. It also highlights the corporate’s contribution in reducing emissions and can help to project it in a leadership role boosting its reputation.Benefits of PRAMAAN
Organizations will be evaluated on two broad parameters, 1) RE progress headway and 2) RE transition readiness,and six sub-parameters.
The progress made by a company in its endeavour to maximize RE consumption will be assessed based on its sources of electricity procurement, the share of renewables, and how successful the company has been in achieving the low carbon electricity goals it has set for itself. The progress made by a company in its endeavour to maximize RE consumption will be assessed by knowing its sources of electricity procurement, the share of renewables, reduction in carbon emissions as a result of choice of low-carbon electricity sources, and how successful the company has been in achieving the low carbon electricity goals.A.1 Renewable electricity consumption share – RE share
Renewable power may be procured through several modes, including from self-owned renewable power plants, such as solar rooftop systems, through open access sources, from RECs, among others. The cost-benefit of renewable power is becoming increasingly evident as it has either attained parity with grid tariff or is even lower in many cases. Also, a higher share of renewable power directly translates to mitigation of carbon emissions. RE consumption share is, thus, a direct indicator of the leadership initiatives undertaken by a company to create a low-carbon future.A.2 Carbon abatement
This sub-parameter evaluates the intensity resulting from the mix of electricity sources opted by the organization.
Combustion of fossil fuels, such as coal, lignite, natural gas, diesel, for power generation, produces carbon emissions. Each of these fuels has a different rate of emission, which is evaluated using the benchmarks set by the Central Electricity Authority of India (CEA). In order to minimize emissions, it may be necessary to take a conscious call on the choice of fuels along with use of RE. Transitioning to RE is an effective way to curb emissions, and hence an essential parameter under consideration. This parameter also considers the organization’s GHG reduction targets and the third party certifications opted by it on its path towards sustainable development.A.3 Target achievement
Setting specific and measurable targets is the first step towards transitioning to clean energy. This sub-parameter also assesses achievement of Renewable purchase obligations(RPO) targets for each year. Organizations for whom RPO is not applicable, it is recommended that they set RE targets voluntarily. This sub-parameter assesses if the RE targets are set with sufficient planning and commitment.
The current status of RE implementation gives an indication of the preparedness of a company's planning in achieving the ambitious RE targets. However, it is equally important to assess if its future targets are aggressive yet achievable, and if the company is equipped to achieve a low-carbon future. The company's readiness for RE transition is assessed by evaluating its strategy for transition, the targets and milestones set, the measures identified to achieve the set goals, and the engagement of the stakeholders to be part of this change and collectively create a more significant impact. These parameters are discussed in detail here.B.1 Risk mapping
The World Economic Forum in its 'Global Risks Report 2020' identifies the ‘failure to mitigate and adapt to climate change’ as the top risk, both by the likelihood of occurrence and impact. In the dynamic evolving energy scenarios, businesses need to be increasingly cost-competitive and in line with national aspirations related to clean energy.
These changes give rise to scenarios in which the businesses face risks, such as stringent regulations (regarding emissions), rise in grid tariff, changing customer perception. Such risks can be mitigated through the usage of renewable energy. Identification of such risks is essential to devise their mitigation policies and an essential indicator of the company's future-readinessB.2 Future strategy
By setting a target, the organization creates a momentum that mobilizes resources and stimulates action. Thus, setting a target to make the transition towards renewable energy and declaring the targets in the public domain indicate a corporate’s commitment and earnestness . Strategic planning involves setting specific goals and targets that are supported by a robust strategy, fund, and resource allocation.B.3 Enabling Ecosystem
The success of an organization's sustainability efforts depends critically on the support and participation of its vendors. Companies that manufacture and/or supply goods, services or software are termed as vendors. These include manufacturers of raw material, components or equipment, and companies that provide services, such as distribution services (transportation, communication, wholesale and retail trade), producer services (financial, insurance, engineering, law, business services). Supply-chain contributes to about 40% of a company's emissions. Thus a much more significant impact can be realized through companies that organize awareness programmes for their vendors, educating them about the benefits of renewable electricity and influencing them to shift to renewable electricity.
The efforts made by the companies to engage with their vendors and educate them regarding the significance of RE will create an ecosystem that drives renewable growth.
National Advisory Committee (NAC) and National Technical Committee (NTC) govern the PRAMAAN rating system.National Advisory Committee (NAC)
The National Advisory Committee members bring unique governance skills and experience to the board. The committee’s role is to give strategic direction to the rating system and advise on outreach strategies to attract participation from large number of business leaders. Suggestions made by the committee will improve and evolve the PRAMAAN rating system and make it a national rating system that encourages Indian businesses to participate in the growth of clean energy in the country.
The National Technical Committee members bring on board essential technical experience and knowledge related to RE implementation. The role of National Technical Committee is to advise on the technical aspects of the rating system.
The activities of National Technical Committee would include:
|1.||Physical verification of submitted data and way forward recommendation for RE, TERI's em-paneled service providers could be engaged.|
|For New RE Plants|
|2.||Pre-feasibility study with RE resource assessment at the site and recommendations for improving RE footprint|
|3.||DPR – detailed project report with resources assessment, sizing solution, technology recommendations, payback period, the time required for implementation|
|4.||We are providing handholding support for tendering, preparing the tender document, bid evaluation, etc.|
|5.||Third-party engineering Services during the project's pre-construction, construction, and acceptance phases. Resco, EPC, developers|
|For Existing RE Plants|
|6.||Third-party performance assessment.|
|7.||Consultation service for further enhancing RE footprint|
|8.||Training for employees. About various RE procurement models, Performance evaluation, operation, and maintenance of various kinds of renewable energy power plants|
|9.||Training and capacity building of registered vendors|
PRAMAAN score indicates an organization’s overall position in its RE transition efforts and commitment to national targets. The score of the six sub-parameters of PRAMAAN highlights the organization’s strengths and also the areas where it needs to focus in future for RE transition.
The sample dashboard here shows the performance of the organization for each sub-parameter. The colours of the bands are indicative of the organisation’s performance.