Energy efficiency targets and tracking savings: measurement issues in developing economies

Energy efficiency plays a central role in climate change mitigation policies, but their impact on economy-wide energy consumption is uncertain. Improved methods to measure energy efficiency savings are adopted mainly in countries with mandatory energy efficiency targets. These countries combine bottom-up and top-down methods to enhance reliability. India has implemented various energy efficiency measures, and their impact is estimated using the simplified deemed savings bottom-up approach. Index Decomposition Analysis is a simple top-down approach, but its use in India is limited due to data gaps. Using India’s energy balances from International Energy Agency, estimate the energy efficiency savings in India during 2011-19. Find that the IDA estimates are lower than the government’s deemed savings estimates. The underlying assumption in the simplified deemed savings approach and data gaps in index decomposition analysis limits the usability of the estimates. National level targets on energy efficiency can push improvements in energy savings measurement techniques used in India. The targets can also address a few barriers in the energy efficiency markets.

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