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DSM and EE Portfolio Services of EESL

Presentation

Saurabh Kumar

Managing Director

Date: 4th April, 2014

Venue: Lucknow

Energy Efficiency Services Limited

EESL 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 innovative 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

EESL Business Models


• Partner with private sector entities

• Risk sharing mechanism developed – technical risk of the private sector partner and revenue risk of EESL

• Selection of private sector partner through open competitive bidding

• Enable financing for PPP projects at reasonable rates – through Banks/ FIs/ Bilaterals and Multilaterals

• Partnership policy evolved to ensure good projects do not languish due to lack of financing

EESL Financial Model


• Deemed savings approach

• Payments delinked to demonstration of savings

• ROE (post tax) of 15% (minimum)

• All other project costs on actuals

• Payment security through ESCROW, LCs

Energy Efficiency in Street Lights - Opportunity

Source: 18th EPS, CEA

Projected Growth in Consumption of energy by Street Lights (m KWh) per annum 8.5 b KWh consumption

annually (2012-13) – growing at CAGR of 7% Potential savings of upto 55% possible by retrofits by LEDs Additional 15-25% savings by intelligent street light management – daylight savings/ dimming, etc Savings of 5 b KWh possible at national level Cost savings of Rs. 2500 crores annually Investment required – Rs. 20,000 crores

EESL Street Lighting Methodology

• Authorisation from Municipality to EESL MoU

• Selection of road and light fixtures for demonstration

Finalisation of Demo project

• Retrofit with LED fixtures and measuring savings and light output Technology Demonstration

• Annuity per LED watt determined based on energy and O&M savings Annuity Determination

• The Payment security mechanism to be finalized. Payment Mechanism

• Implementation agreement signed Implementation

• Deemed saving approach used M & V

Overall cost (energy and O&M) savings to Municipalities

Project Pipeline


Sl. No. Name of ULB Nos. of Lights Estimated Investment

(Rs. Crore)

1 Kolkata Municipal Corporation 281000 295

2 Kerala ULB 520000 390

3 Andhra Pradesh ULB 340000 255

4 Ranchi Municipal Corporation 20000 30

5 Puducherry UT 41100 24

6 Ludhiana Municipal Corporation 90000 54

7 Mohali Municipal Corporation 20000 12

Total 13,12,100 1060

EESL MuDSM Investment – Ongoing

Sl. No. State Estimated Investment

(Rs. Crore)

1 West Bengal (4 MCs) 260

2 Chhattisgarh (6 MCs) 70

3 GUDC (10 ULBs) 200

4 MP (Jabalpur) 40

Total 570

EESL MuDSM Investment – Upcoming

Street Light – costs savings


Repair & Maintenance Cost Savings

S.No. Municipality

Present

Electricity Cost

INR in Lacs

Present O & M

Cost INR in

Lacs

Total (Before

LED

Retrofit)INR

in Lacs

Annuity

(Inclusive

of O &M)

INR in

Lacs

Electricity

Cost with

LED INR in

Lacs

Total

(After

Project)

INR in

Lacs

Monetray

Savings

annualy

INR in Lacs

1 Kolkata Municipal

Corporation 8,754 1,944 10,697 7,405 2,398 9,802 895

2 Sangali Municipal

Corporation 596 58 654 432 190 623 32

3 Solapur Municipal

Corporation 693 110 803 543 218 762 41

4 Nagpur Municipal

Corporation 2,053 300 2,353 1,585 590 2,175 177

5

Ludhiana

Municipal

Corporation

3,235 240 3,475 2,273 982 3,255 220

6

Faridababd

Municipal

Corporation

767 37 804 519 253 773 31

7 Jabalpur Municpal

Corporation 371 63 434 295 107 403 32

8 Trichur Municipal

Corporation 417 26 443 288 123 411 32

9

Hyderabad

Municipal

Corporation

13,205 163 13,368 8,484 4,001 12,484 883

10 Bikaner Municipal

Corporation 322 19 341 221 102 323 18

EESL Ag DSM Methodology

• MoU to be signed between DISCOM & EESL MoU

• Detailed energy audit for existing pumps DPR/ Re Validation Of DPR

• To assess actual energy savings and finalising technical specifications Technology Selection

• Agreement to be signed between DISCOM & EESL for implementation. Agreement

• The Payment security mechanism to be finalized -ESCROW Payment Mechanism

• EESL will implement the project based on own resources Implementation

• Deemed saving approach used M & V

Subsidy savings to States

EESL Ag DSM Business Model

Consumers

Farmer

Government / Regulatory Commission

• Reduction in Subsidy payments

• Policy Guidelines and Approvals

• Inclusion in Annual Revenue Requirement

• Sale of saved energy to other

consumers

• Free Energy Efficient Pump set

• Reduced Energy Bills

• Free Maintenance

• Quality Power Supply

Third Party Testing

Agreement

Utility / Discom

• Capital for Installation of new pumps

• Improved Collection efficiency

• Reduced Losses and Peak Load

• Subsidy Reduction due to saved energy

Contractor

• Design / Installation / Commissioning & R&M

• Demonstrate the energy savings

• Repair and Maintenance

Payment Security Package

Pump

Policy guidelines & Approvals

Electricity sales

Monitoring Agency

Regulator

Location Feeders Replaced

pump sets

Old kW Consumptio

n

New kW Consumptio

n

Reduction in kW

Consumption

Annual Energy Saving

(kWH)

Energy Saving in %

NIPPANI 200

BENADI 99 608.36 391.10 217.26 4,69,282 35.71 %

HANCHINAL 101 526.41 343.61 182.80 3,94,848 34.73 %

BYDAGI 390

KUMMUR 149 916.86 566.50 350.36 7,56,778 39.27 %

INGLAGONDI

95 603.07 369.60 233.47 5,04,295 39.51 %

NELLIKOPPA

146 1029.48 660.40 369.08 7,97,213 35.85 %

TOTAL 590 3684 kW 2331 kW 1353 KW 2.92 M Units 37 %

Energy Saving-HESCOM 590 Pumps

Hubli Ag DSM Project Pump Replacement-

(HESCOM & EESL Team ) Pump Replacement- Pump & Panel

Farmers Awareness campaign First Pump Replacement

Project Pipeline


EESL AgDSM Investment – Ongoing

EESL AgDSM Investment – Upcoming

Sl. No. Name of Electricity Distribution Company Nos. of pump

sets

Estimated Investment

(Rs. Crore)

1 Hubli Electricity Supply Company Limited

(HESCOM), Hubli, Karnataka

11013 55.00

2 Chamundeshwari Electricity Supply Company

(CESC), Mysore, Karnataka

1337 5.00

3 Bangalore Electricity Supply Company

(BESCOM), Bangalore, Karnataka

100,000 500

4 Central Power Distribution Company Limited of

AP

455 2.00

Total 1,12,805 557

Sl. No. Name of Electricity Distribution Company Nos. of pump sets Estimated

Investment

(Rs. Crore)

1. AVVNL, Ajmer 3997 25

2. JVVNL, Jaipur 1806 10

3. AP(East), Vishakhapatnam 2204 8

Total 8007 43

Innovative programme for replacement of incandescent with LEDs at Rs.

10 -25 each developed – BLY architecture followed

Leverages energy savings for cost recovery

In-principle approval of JERC obtained for first project in Puducherry

Project approved for Puducherry – 7.5 lakh incandescent to be replaced –

Started on 7th February.

Three models for cost recovery evolved

(a) Standards Offer Programme – long term contract with DISCOM to ‘buy’ energy

savings from EESL (Puducherry, West Bengal)

(b) Subsidy reduction of State Governments (Bihar and Jharkhand)

(c) Using DSM regulations

Household Lighting - DSM based efficient Lighting Project (DELP)


EESL DELP Methodology

• MoU/ Letter of intent between DISCOM & EESL MoU/ Letter of Intent

• Sample survey to ascertain population of ICLs and usage pattern Sample Survey

• To assess actual energy savings and finalising technical specifications of LED lamps Technology Selection

• Petition to be finalised for cost recovery for submission to ERC DSM-SOP Petition

• The Payment security mechanism to be finalized. Payment Mechanism

• EESL will implement the project based on own resources Implementation

• Deemed saving approach used as in BLY – AMS-II.J methodology M & V

Overall cost (energy) savings to DISCOMs

EESL DELP Market Potential

States ICL Sale in 2012

(Fig in crores)

Energy Savings

Potential (mKWh)

Cost Savings

(Fig in Rs crores)

AP 6.82 4530.526 2265.263

Assam 0.86 571.298 285.649

Bihar 6.2 4118.66 2059.33

Chattisgarh 1.8 1195.74 597.87

Delhi 5.1 3387.93 1693.965

Gujarat 4.21 2796.703 1398.3515

Haryana 1.91 1268.813 634.4065

HP 0.4 265.72 132.86

J & K 0.62 411.866 205.933

Jharkhand 1.56 1036.308 518.154

Karnataka 4.25 2823.275 1411.6375

Kerala 2.1 1395.03 697.515

Maharashtra 9.27 6158.061 3079.0305

Manipur 0.13 86.359 43.1795

Meghalaya 0.12 79.716 39.858

MP 3.6 2391.48 1195.74

Nagaland 0.12 79.716 39.858

Odisha 1.22 810.446 405.223

Punjab 1.81 1202.383 601.1915

Rajasthan 2.6 1727.18 863.59

TN 5.1 3387.93 1693.965

Tripura 0.2 132.86 66.43

UP 8.2 5447.26 2723.63

Uttrakhand 0.7 465.01 232.505

WB 6.2 4190.29 2095.15

Other states 0.7 465.01 232.505

Total quantity in Crore pieces 75.8 50365.57 25212.79

Project Pipeline


EESL DELP Investment – Ongoing

EESL DELP Investment – Upcoming

Sl. No. Name of Electricity Distribution Company No. of ICLs (in

lakhs)

Estimated

Investment

(Rs. Crore)

1 Puducherry Electricity Department 7.3 22

Total 7.3 22

Sl. No. Name of Electricity Distribution Company No. of ICLs (in

crores)

Estimated

Investment

(Rs. Crore)

1 Karnatka 4.25 1700

2 West Bengal 6.2 2480

3 Goa, A&N and Lakshadweep 1.0 400

4 Jharkhand 1.56 624

5 Rajasthan 2.6 1040

Total 20.81 6244*

*EESL is likely to invest about Rs. 1800 crores in the above projects during the next 3 years

DELP – Puducherry Launch The scheme was inaugurated by the Hon’ble Chief Minister of Puducherry on 7th February 2014

DELP – Puducherry Distribution During Launch

DELP – Ex-Counter Distribution

Implementation of energy efficiency measures in Yojana Bhavan –

project to be completed in first week of April – will become 5 STAR

rated building

Template prepared to initiate EE retrofits in government buildings –

submitted to Planning Commission

Audits completed in several other buildings – DPS RK Puram,

CONCOR, Pawan Hans

5 Hospitals in Maharashtra to be taken up

Buildings EE


Distribution EE Project – Submitted to CESC – investment of Rs.

150 crores – in principle approval received – formal agreements

being signed

Industrial EE Projects – Tata Steel and Arvind Mills – Tata Steel –

audit underway for Arvind Mills – audit to commence in April –

expected investment Rs. 150 crores

Cogeneration Project – DPR being prepared – investment decision

thereafter

Expected investment – Rs. 200 crores

Other Projects


BEE-DSM – MoU signed with BEE – DSM plan for 30 states to be

prepared by EESL – total allocation Rs. 26.2 crores

Utility DSM - Project for MSEDCL and BEST under submission to

MERC

SME Projects – GEF proposal prepared for implementation of

demonstration projects in MSME clusters – total value $ 4.5 m (Rs.

27 crores). Similar project of BEE likely to be given to EESL

DISCOM Audit– Audit for all 3 DISCOMs in Rajasthan started – total

value Rs. 80 lakhs – inquiries from 3 other DISCOMs

MOEF – BUR – Work being awarded to EESL for updating SNC –

total value Rs. 80 lakhs

Consultancy Work


REC – Implementing 2 projects worth Rs. 10 crores – one in final

stages of completion. 2 projects already completed

PFC – Projects worth Rs. 12 crores under implementation – one

project already commissioned

IRFC – Project of Rs. 4.5 crores awarded – 2 others worth Rs. 10

crores to be awarded in next FY

Promoter Companies- As per the CSR rules notified, REC and PFC

have a budget of around Rs. 150 crores – EESL gearing up for

additional business opportunity

CSR Projects


Thank You


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