Energy-Inefficient Industries Face the Axe

Energy-Inefficient Industries Face the AxeEnergy-Inefficient Industries Face the Axe

Industries active in oil, power, mining, agriculture and other sectors will face penalties on their energy bills (including the use of electricity, gas, and other petroleum products) if they do not comply with technical and energy specs and standards.

All industrial units consuming more energy than the stipulated cap will be fined from 10 to 100 percent in accordance with their consumption pattern, Tasnim news agency reported. Overuse of 15, 15-30, 30-45, and more than 45 percent will be fined 10, 30, 50, and 100 percent of the tariff specified for that unit, respectively, Friday's report added.

Technical specs and energy consumption standards are determined by a working group comprising representatives of the oil and energy ministries, the vice president for supervision and strategic affairs, National Standards Organization, and the Department of Environment (DoE). The specifics of the plan will be ratified by the cabinet.

The aggregate of the fines are then transferred to the treasury's account, and will be allocated entirely to energy conservation projects.

A comparison between Iran’s energy consumption and global figures indicates that the world's primary energy consumption increased 27 percent during the past decade, while Iran's overall energy usage rose by 80 percent, according to Natural Gas Europe.

Primary energy consumption in Iran reached 1.6 billion barrels of oil equivalent (OE) in 2013, 141 million barrels OE higher than the previous year. Currently, statistics indicate an increase in the usage of all energy carriers, which includes natural gas and gasoline.

The biggest problem with Iran’s high energy consumption is the high rate of energy waste, which accounts for 25 percent of all energy consumption. In the other words, about 0.4 billion barrels of OE is wasted annually nationwide.