TEQUP Scheme of MoMSME by the Office of the Development Commissioner (Micro, Small and Medium Enterprises), Ministry of Micro, Small and Medium Enterprises

  • a) Scheme Objectives
The objective of the present Scheme is to sensitize the manufacturing MSME sector in India to upgrade their manufacturing processes towards usage of energy efficient technologies so as to reduce cost of production and the emissions of GHGs. The second objective is to improve the product quality of MSMEs towards becoming globally competitive.
  • b) Eligibility Criteria
  1. For Capacity Building of MSME clusters, the following organizations are eligible to apply:
    1. Expert organisations /institutes like PCRA, BEE, TERI, IITs, NITs and State Govt. agencies / technical institutes like GEDA, MITCON, Cluster/ Industry based associations of SMEs, NGOs, Technical Institutions interested in application / promotion of Energy Efficient Technologies (EET) are eligible to apply.
    2. Tool Rooms and other autonomous bodies under the Ministry of MSME
  2. Individual MSMEs of identified clusters/ sectors can apply for seeking support/ subsidy in the preparation of enterprise level EET DPRs
  3. For implementation of EET, MSMEs who have filed Entrepreneurial Memorandum (EM) with the appropriate authority or who has erstwhile DIC registration is eligible for support.
  4. For setting up of Carbon Credit Aggregation (CCA) clusters, cluster-based MSME associations, Technical institutions, ESCOs and renewable energy projects that can be registered under CDM are eligible to apply.
  5. For product certification, MSMEs in the manufacturing sector who have submitted valid EM and who are first time applicants for National/ International Product standard licenses are eligible to apply.

c) Scheme Details (Financial Parameters)

  1. For Capacity Building of MSME clusters, financial support to the extent of 75% of the actual expenditure, subject to maximum Rs. 75,000 per programme.
  2. The maximum allowable expenditure for conducting the cluster level energy audits and model DPRs will be Rs. 9.0 lakhs per cluster. For preparation of subsequent DPRs for individual MSMEs, 50% of the actual expenditure subject to maximum Rs.1.5 lakh per DPR will be provided as grant.
  3. For implementation of EET, financial support in the form of subsidy is provided to the extent of 25% of the project cost, subject to a maximum of Rs. 10 lakhs. The balance amount is funded through loans from SIDBI/ Banks/ Financial institutions
  4. For setting up of CCA centres, financial support to the extent of 75% of the actual expenditure, subject to a maximum of Rs. 15 lakhs per centre. The remaining expenditure is met by implementing agency/ SPV through collection of users’ charges
  5. For the major activity involving product certification licenses, MSMEs are provided subsidy to the extent of 75% of the actual expenditure, subject to a maximum of Rs. 1.5 lakh for national standards licensing and Rs. 2.0 lakh for international standards licensing
  6. For the major activity involving impact study, the fee is decided by the Steering Committee (the apex decision making body under the scheme) depending upon the scope of work involved

d) Procedure to Avail the Scheme

  1. Capacity Building of MSME Clusters for Energy Efficiency/ Clean Development Mechanism: 
    MSME clusters are identified for conducting the awareness programmes on Energy Efficiency Technologies (EET) and Clean Development Mechanism (CDM). MSME Clusters are shortlisted and three MSMEs in each of the shortlisted cluster (preferably one micro, one small and one medium) are selected for DPR preparation. The next step, preparation of enterprise level DPRs will be helpful in obtaining financial support
  2. Implementation of Energy Efficient Technologies and other technologies mandated as per the global standards in MSMEs
    MSMEs are assisted in implementation of energy efficiency projects through loans from SIDBI/ Banks/ financial institutions for which subsidy up to 25% of the project cost is provided
  3. Setting up of Carbon Credit Aggregation Centres (CCAs) for introducing and popularizing CDM in MSME clusters. 
    Under this activity, potential MSME clusters having adequate number of EET/ Renewable Energy projects are identified for setting up of CCA centres as Special Purpose Vehicles. The purpose of CCA centres is to assist MSMEs in registering GHG reduction projects for allocation of Certified Emission Reductions(CERs) which are tradable in National and International Commodity exchanges. Clustering/ Aggregation is required because the CERs obtainable from a typical Indian MSME is not adequate for economic trading in exchanges.
  4. Encouraging MSMEs to acquire Product Certification Licenses from National/International Bodies
    Product Certification enhances acceptability of the products in the domestic and the export market. But MSMEs incur expenditure for obtaining such certifications from National Standardization bodies like BIS, BEE etc. Under this activity, awareness is generated in the identified MSME clusters about product quality certification and subsidy is provided to MSMEs towards such expenditure through reimbursements.
  5. Impact Study of the Scheme, Evaluation, Administrative and other Activities
    This is carried out to ensure that the implementation of the scheme stays on course with respect to the action plan prepared. Offers are invited from various agencies for conducting evaluation.

e) Contact Details

Office of the Development Commissioner (MSME)
Government of India
"A" Wing 7th Floor, Nirman Bhawan
New Delhi-110108

f) Scheme details can be viewed at: