Assistance for Deployment of Energy Efficient Technologies in Industrial Establishments (ADEETIE)

      1. India hosts the second largest base for MSMEs in the world, accounts 45% of the total industrial outputs and 8% to the national GDP. MSMEs play a key role in the value chain with the large industry, global industrial trade and the sector also provides the largest share of employment after agriculture. As per MoMSME, there are about 63 million MSME enterprises, with around 20 million in the manufacturing sector, the sector has been the source of income to 110 million employees (50 million rural based).
      2. While global Industrial sectors have advancing to 4th generation of industrial developments (Industry 4.0) enabling digitization, lean systems, low carbon production compliances, India after 78 years of Independence, MSME sector still operational with inefficient technologies & practices and informal in nature. Majority of businesses, particularly within mechanized clusters, have not yet embraced the latest technology upgrades. Based on Bureau of Energy Efficiency (BEE)’s sectoral energy and resource mapping studies, following are key takeaways identified
      • a) There is significant scope for energy efficiency improvements and technology adoption in MSMEs.
      • b) The importance of adequate financial support for technology adoption
      • c) The need for consistent guidance on energy and environmental management practices.
      3. On the other hand, India has ramped up its climate change commitment by revising its Nationally Determined Contribution (NDC). The key goals include reducing emissions intensity by 45% from 2005 levels by 2030. India's climate strategy aims for a complete decarbonization of the economy by reaching Net-Zero emissions by 2070, as envisioned by the Prime Minister's Panchamrit Goals. India has also played a leading role in the G20 by proposing a "Voluntary Action Plan" to double the global rate of energy efficiency improvement by 2030.
      4. Well-defined energy policy is crucial for translating India's vision for energy security and sustainability into action. In view of inherent challenges of MSMEs and climate change commitments, India needs to gear-up developing MSMEs towards energy efficient practices, enable the sectors to match at par with the global technological developments and best practices.
      5. The department (Ministry of Power) has envisaged a constructive scheme (policy) enabling complete handholding services for adoption of energy efficient technologies, supported by fiscal financial incentives (interest subvention). Assistance for Deployment of Energy Efficient Technologies in Industrial Establishments (ADEETIE) Scheme has been pragmatically planned with following;
      Objective: To facilitate MSMEs to upgrade with energy efficient technologies/measures through financial instruments and handholding them in carrying out investment grade energy audit, detail project report, monitoring and verification of the implementation.

Scheme components:

  • (i) Interest Subvention: The scheme provides a 5% (Small – Micro) and 3% (medium) interest subvention on loans for technology adoption
  • (ii) Streamlined Project Implementation – Widespread promotion and awareness, support for Investment grade energy audits and preparation of detail project reports, end-2-end support in all stages till monitoring and verification of the implementation.
  • (iii) Constitution of dedicated project management unit.

Eligibility: This scheme is designed to help manufacturing businesses in India become more energy efficient. Enterprises operating in industrial clusters across the following energy-intensive sectors will be covered: 1. Brass, 2. Bricks, 3. Ceramic, 4. Chemical, 5. Fishery, 6. Food Processing, 7. Forging, 8. Foundry, 9. Glass & Refractory, 10. Leather, 11. Paper, 12, Pharma, 13. Steel Re-rolling, and 14. Textile.

The scheme will be implemented in a phased manner, initially focusing on 60 clusters. Approximately up to 9000 units would be covered in the first phase under the scheme. In the next phase another 100 clusters would be covered. This phased approach allows for demonstrating success and streamlining the scheme based on learnings from the initial phase.

Budgetary outlay: 1000 Crore (875 Cr Interest Subvention; 50 Cr support for Investment Grade Energy Audits Support; 75Cr Hand holding support by Bureau of Energy Efficiency)

Anticipated Investments: 9000 Cr (overall investments from the scheme); 6750 Cr of prospective lending from MSMEs

Implementation Period: 3 years (FY 2025-26 to FY 2027-28)