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Cover Story | July 2018

LED lighting programme sets off a supply - demand chain reaction

In an exclusive interview to POWER TODAY, Saurabh Kumar, Managing Director, Energy Efficiency Services (EESL) explains how the LED lighting programme has been a big game changer.

How many municipalities in India have partnered with EESL for the provision of LED lighting under the energy services company (ESCO) model at the last count?
India's streetlights form a crucial component of the nation's investment in lighting and road safety. Launched in 2015, EESL's street light national programme (SNLP) has been instrumental in retrofitting over 6.1 million conventional street lights with LEDs in 941 municipalities across 28 states and union territories in the country. This led to the saving of 4,097 million units of energy per year and reduction of 2.82 million tonne greenhouse gas (GHG) emission per year on an average.

Besides the return on investment (ROI), our business model creates human impact. Well-lit, safe streets enable businesses to stay open longer, besides providing better driving conditions. Many states have shown interest in SLNP after seeing its real-time benefits on our online dashboard. The response that we have received from states, urban local bodies, and citizens is very encouraging. We aim to build on this momentum and retrofit 13.4 million streetlights by 2019.

How many bulbs did EESL replace with energy-efficient LED solutions from the time of conception of the programme till the end of FY 2017û18 across India?
Till the end of FY 2017û18, under the UJALA programme, EESL had distributed 294.6 million superior quality LED bulbs to domestic consumers covering 36 states and union territories.

What would you consider as the main reasons for the overwhelming success of the programme?
EESL's innovative business model of zero subsidy, zero capex, and pay-as-you-save obviates the need for any upfront capital investment in any of the interventions. The upfront cost is borne by EESL and the savings monetised over time are used to recover the cost of investment. This leads to a reduction in the initial cost of adoption of transformative solutions. This is mainly achieved through innovative risk allocation of procurement, installation, service, and maintenance; aggregation of demand by including incentives for all stakeholders; putting out large procurements to leverage economies of scale; and the virtuous cycle of passing on the benefits to end users for more demand aggregation.

In your January 2018 interview with POWER TODAY, you termed the LED revolution as the country's biggest Make in India success story. How has it helped manufacturers of LED lighting   solutions?
Under the UJALA programme, EESL has provided an impetus to domestic manufacturing by creating favourable market conditions for new and allied industries to develop. The Indian LED market has grown nearly ten times over the past five years while annual domestic production has increased from approximately 3 million LED bulbs in 2013 to 62 million in 2015! UJALA has played an important role in this rapid growth. EESL's approach to bulk competitive procurement has managed to attract tremendous interest and participation from the industry. According to the Electric Lamp and Component Manufacturers' Association (ELCOMA) India, the apex body of lighting manufacturers in the country, the LED industry is projected to grow dramatically on the back of these initiatives. It is expected to constitute approximately 60 per cent of the overall lighting industry by 2020.

The overall impact of the programme is creating a full supply-demand chain reaction, which delivers favourable economies of scale to a range of manufacturers and strengthens the domestic LED market. UJALA has created an ecosystem for high-quality products, even while enabling LED manufacturers to potentially be able to compete internationally, as there is a growing demand for affordable LEDs globally.

Any more interesting initiatives from EESL in the coming months?
The National E-mobility Programme was launched on March 7, 2018 by the Minister of Power, New and Renewable Energy, Raj Kumar Singh, in New Delhi. As on date, it is operational in Maharashtra, Telangana, and Madhya Pradesh. The programme is planned and executed in key states including Andhra Pradesh, Gujarat, Maharashtra, Rajasthan, Madhya Pradesh, Telangana, and Uttarakhand.

EESL floated the first phase request for proposal (RFP) for 5 million smart GPRS metres in Uttar Pradesh and Haryana on August 01, 2017. Following which, EESL is in the process of deploying 4 million smart metres in Uttar Pradesh and 1 million in Haryana over the next three years. Further, the second technical bid was floated by EESL on May 15, 2018, and the price bids of the qualified bidders will be unveiled shortly. In the second phase, another 5 million smart metres will be installed over three years in a phased manner. The states of Andhra Pradesh, Delhi, Telangana, Gujarat, Tamil Nadu, and Bihar have also shown interest in the programme.

Till the end of FY 2017-18, EESL had distributed nearly 300 million LED bulbs to domestic consumers across the length and breadth of India under the Unnat Jeevan by Affordable LEDs and Appliances for All (UJALA) scheme. The initiative provided a huge boost to the domestic LED industry, with the market growing nearly ten times over the past five years and domestic production rapidly expanding from
3 million bulbs in 2013 to 62 million in 2015.

-Manish Pant
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