Facilitating DSM DSM Based Efficient Lighting Program: A Case Study

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1 Facilitating DSM DSM Based Efficient Lighting Program: A Case Study Neelima Jain Energy Efficiency Services Ltd (A JV of PSUs of Ministry of Power, Govt of India)

2 Significant Demand Side Management potential in the Indian economy Market Opportunity Energy consumption, billion kwh, Municipalities $439, % Agriculture Domestic % - 30% - 20% Pre - DSM Municipalities Agriculture Domestic Post - DSM Energy savings, $ billion $ 0.18 $ 1.7 $ 1.5 $ 3.5 Total savings potential Source: BEE/ CEA/ EESL 2

3 Multiple challenges associated with implementing DSM Market Barriers Structural Payment security: Lack of it increases capital costs M & V: Linking payments to bill reductions prompts non-implementation Standardization: Non-confirmation to standards Behavioral Availability Baseline: Inadequate data availability Capital constraints: Inability to finance Technology: Lack of products or channels Lack of awareness: About energy efficiency technologies High risk perception: Regarding return on investments Low mind-share: Energy efficiency not usually the primary focus 3

4 Addressing barriers in the existing market EESL s Value Offerings Barriers EESL s Approach EESL s Solutions Structural Payment security M & V Standardization Annuity based/deemed savings model Capacity building, Workshops, Toolkits DELP DAP-E DSM Based Efficient Lighting Programme DSM Action Plan Availability Behavioral Baseline Capital constraints Technology Lack of awareness High risk perception Low mind-share ESCO mode large scale implementation Implementation at no cost to DISCOMs Monetization through energy savings Upfront investments SLS - E MPS-E Ag DSM Street Light Solutions Municipality Drinking water Pumping Solutions Agricultural DSM 4

5 DELP proposes to overcome the existing market barriers and aid DISCOMs in widespread penetration of LEDs Opportunity Barriers 750 mln ICLs are sold in India every year 90% of the electricity is converted into heat in ICLs LEDs could lead reduce demand by 10-15,000 MW Cost constraints M & V Technology Lack of awareness Distribution of LEDs to households in exchange of working ICLs and nominal fee Distribution of LEDs to grid connected households through door to door distribution or collection points Collection and destruction of ICLs by EESL. Monitoring and verification through simplified M&V in BLY deemed savings Distribution Utilities will implement DELP through EESL and link payment with resultant energy and load reductions DELP Methodology 5

6 DELP in Puducherry is being implemented on Standards Offer Programme this is first such case in India Key Parameters Value Impact on households and DISCOM Yearly energy consumption Yearly T&D losses Number of Households 2,45,000 Number of LEDs 7,35,000 ICL Wattage 60W LED Wattage 8W Usage per day 3.5 Hrs Operating days per year 300 Days With ICLs With LEDs - 463,05,000 kwh 61,74,000 kwh 87% reduction in consumption 66,15,000 kwh 8,82,000 kwh 57,33,000 kwh of reduction in T&D losses Puducherry to be recognized as first state in South Asia to switch household lighting to energy efficient LEDs from the conventional ICLs 6

7 DELP could result in several environmental, economical, and social benefits Savings of INR Crs due to reduction in demand LEDs almost at the cost of ICLs Reduction in power procurement of about MU per annum INR Cr savings in power procurement cost over the period of 10 years Consumer DISCOM DELP Benefits EESL Society Project IRR over a period of 10 years 16.06% Million KGs of reduction in carbon Creation of temporary jobs 7

8 Thank You 8

9 Energy Efficiency Services Limited Creating an energy efficient India 9

10 Energy Efficiency Services Limited Business Objectives Create market access in public and private facilities handholding, information dissemination, capacity building Develop projects for various sectors addressing specific barriers and challenges Design risk mitigation measures to address technical, financial and regulatory risks Provide and secure funding at reasonable rates for project implementation Develop model templates necessary for project implementation by including the above Disseminate best practices to stakeholders so that replication can occur 10