Case Study: Energy-Efficiency Services Limited (EESL), India
In India, the Ministry of Power set up Energy Efficiency Services Limited (EESL), a joint venture of four power PSUs—NTPC, Rural Electrification Corporation, Power Finance Corporation, and Powergrid Corporation of India to facilitate implementation of energy-efficiency projects. EESL works across multiple disciplines to promote energy efficiency. EESL is the first company in South Asia exclusively focused on energy-efficiency implementation and is responsible for facilitating bulk procurement of both LED household lamps and LED streetlights lowering the cost of the product, making it affordable for consumers with a view to replace 770 million LEDs in households and 35 million LED street lights by 2019.
By August 2016, 155 million households LED lamps and 1.2 million LED streetlights had been deployed. With the use of bulk procurement, EESL’s 9 Watt household LED lamp (branded under UJALA) has decreased its selling price from $4.80 at the start of 2014 to around $1.00 by the end of 2016. Similar LED lamps in normal retail markets in India also decreased to approximately $1.50 over the same time period. EESL works with utilities through on-bill financing (OBF) and classic pay-as-you-save mechanisms with residential consumers and with manufacturers and vendors through annuity-based financing for municipal street lighting. The low selling price may not be achieved in other countries due to the large economy of scale that India is able to achieve with its bulk procurement.