To sustain the high economic growth trajectory of India, it is imperative that an adequate supply of energy is maintained over a long period of time. One such major initiative is the thrust laid on energy efficiency interventions as a low-hanging option for meeting the overarching energy and climate goals of the country. We analyze market-based approaches for energy efficiency interventions, with a specific focus on the Perform, Achieve and Trade (PAT) scheme. Policies governing energy efficiency interventions reveal that policies have evolved over three different phases characterized by a gradual transition from a regulatory regime to a market-based arrangement. Analysis of the PAT scheme points to the fact that while the scheme is designed in a dynamic manner and has huge energy-saving potential, a lack of clarity at the policy level and operational anomalies could generate dampening effects on future energy efficiency investments. Policy streamlining becomes imperative for successful implementation of this scheme.