The Government of India has enacted the Energy Conservation Act, 2001 (No. 52 of 2001, 29th September, 2001) which came into force on 1st March 2002. This Act provides a legal framework, institutional arrangement and a regulatory mechanism at the Central and State level to embark on an energy efficiency drive in the country.

Bureau of Energy Efficiency was established with effect from 1st March 2002, under the provisions of the Energy Conservation Act, 2001.It is responsible for the implementation of policies and programmes related to energy conservation and energy efficiency. The mission of the Bureau of Energy Efficiency is to institutionalize energy efficiency services, enable delivery mechanism and provide leadership to energy efficiency in all the sectors of the country. Its primary objective is to reduce energy intensity in the Indian economy.

PEDA has been declared as the State Designated Agency by the Govt. of Punjab under the guidelines of Bureau of Energy Efficiency to coordinate, regulate and enforce the Energy Conservation Act – 2001 within the state of Punjab since January, 2005.