Energy efficiency and environmental implications in India's household sector

This present paper provides a methodological framework for estimating the costs and benefits to the household sector through the replacement of the existing inefficient technologies with efficient ones, and suggests policy measures. Annualised Life Cycle Costs (ALCC) are calculated taking into consideration the capital cost of the device, its life, operating cost, energy carrier price, etc. using a 12% discount rate. The results show that the average discounted payback period for many of these technologies, at the current capital costs, is less than two years which usually considered warranting the investment. It is seen from the results that, on average, for every hundred rupees of capital invested on efficient lighting systems, the consumer gets an annual return of about Rs.60. This shows that the rate of return on investment is very high. The paper identifies the barriers that prevent the government from achieving its energy efficiency goals, analyzes programs that address these barriers, and explores the creation of an institutional mechanism.