Micro, Small, and Medium Enterprises (MSMEs) are the backbone of India’s manufacturing economy, contributing over one-third of national output and employing more than half the sector’s workforce. But these firms are also disproportionately energy-intensive, operating with outdated boilers and inefficient fuels that inflate costs, drive emissions, and expose workers to unsafe heat and air quality. In many dyeing units, surface can exceed 45–50°C, exposing workers to extreme radiant heat. By 2030, the sector is projected to emit more than 72 million tonnes of CO₂.

Energy-efficient technologies (EETs) offer a clear pathway to reverse these trends — but adoption remains stubbornly low. MSMEs face a mix of structural barriers, from limited technical expertise and information gaps to financial constraints and organizational risk aversion. This study set out to test whether targeted information, peer learning, and trusted local intermediaries could close this adoption gap, and in doing so, position MSMEs as active drivers of India’s low-carbon transition.

We designed a two-phase intervention focused on MSMEs in dyeing units, which our fieldwork and stakeholder consultations pointed to as particularly energy-intensive.

• Scoping study (Kolkata, 2024–2025): Built a stakeholder map, assessed the state of existing technologies, and documented barriers to adoption. We found outdated boilers operating 11% below optimal efficiency, micro-firms with especially large efficiency gaps, and widespread lack of awareness of energy audits or EET options. These units not only consume high levels of fuel but also generate significant radiant heat, making energy efficiency both a productivity and safety issue. 
• Pilot RCT (Tirupur): Using a randomized control trial, we tested whether pairing standard energy audits with peer consulting and vendor linkages would improve adoption. Control firms received only audit reports, while treatment firms also received:
  – introductions to local service providers,
  – case studies of successful adopters,
  – peer learning opportunities with firms in their cluster. 

This design allowed us to test whether “social proof” and trusted intermediaries can overcome the skepticism and inertia MSMEs face.

The RCT in Tirupur covers 51 dyeing firms, supported by a certified energy auditing firm and a local implementation partner. Walk-through audits documented baseline boiler efficiency and fuel consumption, and generated firm-specific Return On Investment (ROI) calculations for recommended EETs.

Data collection includes:

• audit reports and recommendations, 
• survey responses on awareness, adoption, and future intentions, 
• vendor and peer case studies documenting adoption experiences, 
• administrative data on energy use and costs. 

At the endline, we will test whether firms exposed to peer consulting were more likely to adopt or actively consider adoption compared to firms with only audit recommendations.

 From the West Bengal scoping study:

• MSMEs use outdated boilers, driving excess fuel costs and emissions. 
• Major barriers include lack of awareness, perceived risks, technical gaps, and cyclical demand. 

From early pilot data in Tirupur:

• 65% of firms reported learning about a new EET. 
• 45% had implemented at least one recommended technology.

It’s well established that adopting efficient technologies improves workplace conditions reducing ambient heat, improving air quality, and lowering worker fatigue. When firms adopt more efficient systems, that heat burden drops. Workers report fewer breaks, fewer errors, and better comfort on the job which translates into tangible gains in productivity and retention.

By addressing heat as both a climate and workplace challenge, our approach links energy savings directly to human outcomes creating a virtuous cycle where efficiency reduces emissions, improves working conditions, and strengthens business performance. Scalable and modular, these strategies can be replicated across clusters and geographies, positioning MSMEs as key drivers of a low-carbon, heat-resilient industrial future.