1. Market aggregating models – scaling an EE portfolio
Market aggregating models – scaling an EE portfolio
Session: How India Scaled up Energy Efficiency via Innovative Business Models
Manu Maudgal
Programme Advisor
Sustainable Lifestyle = Positive Climate Action

2. EESL-Who We Are
Promoters with net worth of over $40 billion (1 October 2016)
Implementing possibly the largest Energy Efficiency Portfolio in the world – in sync with national priorities- achieving actual energy savings
Authorized share capital $ 220 million; Debt appetite of $ 220 million in short term (FY 2017)
In the works over $ 1 billion ‘Lines of Credit’ under bilateral/ multi-lateral agencies (ADB, WB, KfW, AfD)
1 billion USD= Rs 6800
Euro 100 mn Line of Credits obtained from KfW (Euro 50 mn) and AfD (Euro 50 mn) under Bilateral arrangements.
Discussions going on for additional line of credits with World Bank (USD 300 mn), ADB (USD 200 mn) and KfW (Euro 200 mn).

3. EESL – Two Business Models
On Bill Financing Model (OBF)-
Interventions directly with consumers – LEDs, Fans, ACs, etc
Consumers (for LED bulbs and Fans) pay EMIs through their electricity bill for 1-2 years
ESCO ‘Service’ Model-
Dealing with institutions like Buildings, Agriculture, DISCOMs, Municipalities
Implementation and investment by EESL in the whole facility
Payments from savings in energy and maintenance cost
Common Under pin
Turnkey execution - no cost and manpower resources from Utilities/ Municipal bodies
No subsidy ; Entire upfront investment by EESL

4. Our Impact

5. Lighting Market Aggregation
Share of LEDs in Indian lighting market increased from less than 1% to 15%
Near 80% Price reduction – from ~$ 5 to $ 1
High levels of awareness about LED products and their energy efficiency benefits
15%

6. Street Lighting National Programme
Conventional Street Lights replaced by smart LED street lights
20-30% energy savings guaranteed
7 years maintenance part of the project
Entire investment made by EESL – no capital cost to Urban Local Bodies (ULBs)
Utility re-pays to EESL from savings in energy and maintenance cost
Centralized Control and Monitoring System (CCMS) for measuring consumption, monitoring faults and remote operations
Strong quality control – fault rate < 2%
Social audit in every project to assess in social impact
In Vizag
Actual electricity bill reduced by 45%
Light levels have improved between %
High levels of public satisfaction – social audit

7. Snapshots of LED Street Lighting in India
Conventional lighting
LED lighting

8. Four Lessons: Biz Model

9. Lesson # 1: Adopt Standard Technology
Standardization of Technology to match the necessary output
Selection of equipment that could lead to significant savings by scale up and is cost effective
Barrier Addressed: Technical
Improved penetration of energy efficient product in the market
There can be other barriers as well:
absence of technological solutions, unavailability of solutions in local market, absence of secure payment mechanism

10. Lesson # 2: Adopt Demonstrated & Deemed Savings M&V
One time demonstration to validate outputs and energy savings (~30-50% savings)
Trunkey implementation and maintenance over the contract period
IT enabled real time monitoring of energy consumption
Barrier addressed: Institutional
Overcome absence/ authenticity of baseline data
Overcome in-availability of managers who can assess and guarantee the energy savings
Other: mandatory energy audit
non-availability of an appropriate delivery mechanism & absence of Institutional framework, Lack of coordination amongst different initiatives-different Government Ministries/departments

11. Lesson # 3: Aggregate Demand
Aggregation of demand across states; Pooling of prices to pass on benefits of reduced prices
Aggregation of supply; Transparent procurement in bundles to ensure continuous price discovery and sustainability of demand
Barrier addressed: Information, Financing
Overcomes access to standard templates for Procurement and quality control etc.
Lower capex and investment by ESCO overcome access to financing
lack of awareness, Lack of data on actual building stock, energy consumption by different sectors,
Low electricity tariff, Lack of energy subsidies, Non-payment& electricity theft

12. Lesson # 4: Make EE Visible
Online and real-time monitoring tools developed; to monitor the performance
lack of awareness, Lack of data on actual building stock, energy consumption by different sectors,
Low electricity tariff, Lack of energy subsidies, Non-payment& electricity theft
yojanabhawan.demo SSBhawan.Demo

13. Our Green Portfolio

14. Our Green Portfolio Overall project pipeline > US $ 2 billion
Execution Capabilities “Different Sectors”
Irrigation Pumpsets
Municipalities – “Public lightings, water pumping”
Buildings – “HVAC, BMS, lighting solutions”
Energy Efficient Appliances – “ Lighting, Fans, Air conditioners”
Tri-generation
Smart grid Meters
Implementation of Central & State Gov. Initiatives
Standard & Labelling Programs
Perform Achieve & Trade Scheme for industries
Advisory Services
Institutional capacity building
Policy inputs to government
Energy Efficiency under CSR activity

15. …ready to work globally Do attend the next session on Green Bonds !