The Ministry of Power launched the National  Mission for Enhanced Energy Efficiency  (NMEEE) under the National Action Plan on Climate Change (NAPCC) with the objective to strengthen the market for energy efficiency through implementation of innovative business models in the energy efficiency sector. NMEEE consist of four initiatives to enhance energy efficiency which are: Energy Efficiency Financing Platform (EEFP); Market Transformation for Energy Efficiency (MTEE); Framework for Energy Efficient Economic Development (FEEED) and Perform Achieve and Trade (PAT).

The Perform, Achieve and Trade (PAT) Scheme is a programme focused on reducing energy consumption and promoting enhanced energy efficiency among energy intensive industries in the country. BEE is the implementing agency for the PAT scheme across the country. PAT is a market-based mechanism in which identified energy intensive industries and other establishments (called Designated Consumers) are given targets for reducing their Specific Energy Consumption (SEC). The SEC targets for each plant are different and are set by BEE based on energy efficiency performance and classification, e.g., similar processes, CPP/Non CPP, etc. The DCs need to achieve the SEC targets in a 3-year period which is called a PAT cycle. DCs which over-achieve the given SEC target will get incentives in the form of energy saving certificates. These certificates are tradeable and can be bought by other DCs which are unable to achieve their targets. Alternately, the DCs unable to achieve the target would have to pay the penalty, at the price determined and notified by the BEE, which is the price of metric tonne of oil equivalent.

The price of these certificates is determined by the market. 

The PAT scheme in its first cycle, operationalized in April 2012 covered 478 industries known as ‘Designated Consumers (DCs)’ from 8 sectors: Aluminium, Cement, fertilizer, Pulp & Paper, Thermal Power Plant, Chlor-Alkali, Iron & Steel and Textile. Since 2016, PAT is under rolling cycle and new industries and new sectors get added every year. Subsequently new industries and new sectors like Railways, Petroleum Refinery, Petrochemical, DISCOM, Hotels (under commercial buildings) and Airports are also being covered under PAT. As of April- 2019, 956 No. of DCs from 13 energy intensive sectors are notified as Designated Consumers based on their annual energy consumption.

Designated Consumers (DCs)

“Every energy intensive industry and other establishments whose annual energy consumption is equal to or greater than the threshold limit specified in the central Government notifications , shall be deemed to become Designated Consumer and consequently he shall be considered liable under Section 26 (Energy Conservation Act, 2001) for imposition of penalty for his failure to comply with obligations of DC.” It is mandatory for DCs to meet specific Energy Consumption Norms and Standards and requirements under PAT scheme.