Complete Guide To ADEETIE Scheme For MSMEs In India

Energy efficiency has emerged as a key factor in the assessment of Indian MSMEs’ competitiveness and sustainability. Small and medium enterprises are often faced with the problem of reduced profits due to increasing power tariffs, fuel costs, and operational expenses. To counteract this problem, the Government of India introduced an initiative called the ADEETIE Scheme which is a very powerful one.

This article provides a comprehensive guide to the ADEETIE scheme, including– its definition, goals, advantages, who can apply, the application process, and why it is significant for MSMEs..

What Is An ADEETIE Scheme?

The ADEETIE System signifies Assistance for Deployment of Energy Efficient Technologies in Industries & Establishments. It is an Indian Government program which is executed by the Bureau of Energy Efficiency (BEE) under the Ministry of Power.

Why Was The ADEETIE Scheme Introduced?

MSMEs are the backbone of the Indian economy; they have a major impact on employment, exports, and industrial output. Yet, a great number of MSMEs still rely on old machinery and inefficient methods which waste a lot of energy. The main problems that MSMEs confront are:

• High energy and fuel costs
• Limited access to cheap funding
• Insufficient technical know-how on energy-efficient practices
• Little knowledge of the latest energy-saving devices

ADEETIE was created as a solution to these issues through energy conservation improvements that are both technically possible and financially viable.

Objectives of ADEETIE Scheme

The main objectives of the ADEETIE Scheme are:

1. To promote adoption of energy-efficient technologies in MSMEs.
2. To reduce energy intensity in industrial and commercial establishments.
3. To lower production costs and improve profit margins.
4. To enhance global competitiveness of Indian MSMEs.
5. To support India’s climate and sustainability goals.
6. To create a structured ecosystem for energy efficiency financing.

Who Implements the ADEETIE Scheme?

The ADEETIE Scheme is implemented by the Bureau of Energy Efficiency (BEE) under the Ministry of Power, Government of India. BEE is responsible for planning, coordination, monitoring, and execution of the ADEETIE Scheme across India.

Key Features of ADEETIE Scheme

The ADEETIE is an MSME startup scheme that extends financial and technical assistance to MSMEs for the implementation of energy-efficient technologies. The following are its main features:

• Interest Subsidy: 5% for Micro and Small Enterprises, and 3% for Medium Enterprises.
• Energy Efficient Technology Support: Modern, energy-saving equipment will be made use of, and thus, encouraged.
• Energy Audit Facility: Opportunities for saving energy are identified.
• DPR Assistance: Project report preparation for loan approval is done with the help of this.
• Technical Handholding: Support during planning and implementation process.
• Monitoring & Verification: Energy savings are actually ensured.
• MSME Focus: For MSMEs only.
• Cluster-Based Approach: The method is applied in industrial clusters.
• Multi-Sector Coverage: The different energy-intensive sectors are covered.
• Sustainability Promotion: Green and sustainable growth is supported.

Target Sectors Under ADEETIE

ADEETIE primarily targets energy-intensive MSME sectors such as:

• Textiles
• Foundry
• Forging
• Ceramics
• Bricks
• Chemicals
• Food Processing
• Pharmaceuticals
• Leather
• Paper
• Glass and Refractories
• Steel Rolling
• Fishery
• Engineering clusters

These sectors consume large amounts of electricity and fuel, making them ideal for energy-saving interventions.

Financial Coverage

• Loan Support: MSMEs can take loans for energy-efficient projects and receive interest subsidies under ADEETIE.
• Scheme Duration: The scheme is implemented during FY 2025–26 to FY 2027–28.
• Budget: The Government has allocated ₹1,000 crore for the ADEETIE Scheme, which is expected to mobilize several times more private investment in energy efficiency.

Technologies Supported Under ADEETIE

Typical technologies supported include:

• High efficiency motors
• Variable Frequency Drives (VFDs)
• Energy efficient boilers and furnaces
• Waste heat recovery systems
• Efficient compressors
• Refrigeration and cooling optimization
• Power factor correction systems
• Automation and digital energy management

Any technology that demonstrably reduces energy consumption can be considered.

Step-by-Step Application Process

Applying for the ADEETIE Scheme is simple when you follow the right steps. The scheme is designed to guide MSMEs from energy audit to loan support in a structured way.

• Check Eligibility: Ensure your MSME is Udyam-registered and located in an eligible industrial cluster.
• Submit Expression of Interest (EOI): Share basic business and energy details to show interest in the scheme.
• Energy Audit (IGEA): A certified auditor checks your energy usage and suggests savings opportunities.
• Prepare DPR: A Detailed Project Report is made with cost, technology, and savings details.
• Apply for Loan: Submit DPR to a registered bank and get loan with interest subsidy
• (5% for Micro/Small, 3% for Medium enterprises).
• Install Technology: Implement approved energy-efficient equipment.
• Monitoring & Verification: Energy savings are verified after installation.

Note: Udyamita Helpline supports MSMEs at every step, from eligibility check to loan guidance, making ADEETIE application smooth, fast, and stress-free.

Benefits of ADEETIE Scheme for MSMEs

The following are the benefits provided by ADEETIE Scheme for MSMEs:

• Reduced Energy Bills: Lower electricity and fuel consumption directly increases profits.
• Lower EMI Burden: Interest subsidy reduces loan repayment stress.
• Improved Productivity: Modern equipment improves process stability and output.
• Enhanced Market Competitiveness: Lower cost of production helps in pricing and export competitiveness.
• Sustainability Advantage: Energy efficiency improves ESG and environmental credentials.

ADEETIE Scheme vs Traditional Subsidy Schemes

Unlike traditional subsidy schemes that focus only on financial assistance, ADEETIE provides:

• Financial + Technical support
• Pre-project + Post-project assistance
• Performance-based validation

This makes ADEETIE more practical and results-oriented.

FAQs