Can the carbon market fund energy efficiency projects?
The Alliance will explore the issue in a feasibility study that identifies opportunities for funding energy efficiency measures in India’s small and medium enterprise clusters through a carbon trading mechanism. Just over 380 small and medium enterprise (SME) clusters account for up to 40 percent of India’s energy use and emissions. Despite a recognized need to bolster energy efficiency in Indian SMEs, the topic is not widely considered due to a high equipment costs, limited subject knowledge and a lack of financing. The Alliance is investigating an alternative to the status quo. With € 100,000 (about USD 130,000 ) in funding from the Renewable Energy and Energy Efficiency Partnership (REEEP) over 1 1/2 years, the Alliance’s India office will test a new financing mechanism that leverages profits from the carbon market to fund energy efficiency measures in India’s SMEs. Why carbon markets? There is a great – and largely untapped – opportunity to involve energy efficiency in this area. A
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