India’s most successful energy efficiency program – the LED lighting initiative of the government has faced allegation of irregularities and corruption from the Congress party, a charge that has been strongly denied by both the power ministry and the Energy Efficiency Services Ltd (EESL) – the state-owned firm responsible for making the LED program a hit not only in India but also globally. In fact, admiring EESL’s success story, a case study has also been published by International Energy Agency (IEA), Paris.
A press statement issued by Shaktisingh Gohil, Spokesperson, AICC had alleged irregularities in tendering process of LED items, wreaking the ‘Make in India’ policy by import of Chinese LED bulbs and flouting all vigilance norms and a scam of Rs. 20,000 crore by EESL.
EESL, under the administrative control of Ministry of Power called this statement as “completely false and motivated.”
Dismissing the allegations, EESL has stated that LED bulbs are procured by the company in the most transparent and professional manner. Till date, over 22 crore LED bulbs have been sold under the Unnat Jeevan by Affordable LEDs for All (UJALA) scheme, leading to a savings in consumer electricity bills by Rs. 11,500 crore.
“The allegations made in the press note are false, malicious, misleading, motivated and devoid of any facts and need to be completely disregarded. EESL stands by the professionalism, values and highest standards of public probity and transparency that it has demonstrated in all its programmes,” it added.
EESL is the implementing agency for National LED lighting programmes, inaugurated by Prime Minister Narendra Modi on 5th January, 2015. The programme is designed to reduce energy consumption in the lighting sector and to promote LED based efficient lighting products.
Responding to the allegations, it was clarified by EESL and ministry officials that transparency in procurement has actually led to significant gains during the last 3 years.
These include reduction in prices of LED bulbs by 88% with considerable improvement in quality. The procurement price of 7 W LEDs that in January, 2014 was Rs. 310 now stands reduced to Rs. 38 in August 2016 for a 9 W LED bulb.
The procurement norms allowed only those bidders who have manufacturing facilities in India. As a result, almost all LED bulbs are being assembled in India and the manufacturing capacity has risen to about 3-4 crore LED bulbs every month now from about 1-2 lakh 3 years ago.
It added that the consumers have benefitted by the use of LED bulbs and their annual electricity bills have reduced by over Rs. 11,500 crore. Moreover to impart transparency, the entire status of the programme, including the information about the availability of LED bulbs, savings, monitoring and verification and progress of private industry is available in public domain at www.ujala.gov.in.
EESL said that no Chinese or any other manufacturer who is yet to set up manufacturing facilities in India has participated in the tenders.
The increase in capacity and reduction in costs have meant that the consumer is getting LED bulbs by EESL at Rs. 65-70 and the retail prices have come down to 30% of what they were 3 years ago. The total LED sales have gone up from about 60 lakhs (2014-15) to 15 crore (2015-16) and is likely to be 35 crore in the current year. This has made India the fastest growing LED market in the world and is now accounting for 12% of global demand.
It has been further clarified that the procurement by EESL is through e-tendering and the RfP is not only announced in leading national newspapers but is also uploaded on its website as per the norms prescribed.
The last order placed by EESL for 5 crore LEDs in September, 2016 is nearing completing and the company that won the bid has already supplied close to 4.8 crore LEDs. The balance will be done by the end of this FY as per the tender conditions, EESL said.
The company said that the LED bulbs go through a rigorous quality check and require to have LM 79 and LM 80 certifications as per the BIS specifications. EESL has a 3-tier quality control mechanism as a result of which, of the more than 22.1 crore LEDs distributed, the fault rate is well below 1%, which is the lowest in the world.
In the Street Light Program, EESL said it has replaced over 19 lakh street lights with LEDs and have introduced smart controls to enable transparent monitoring in real time. Over 200 ULBs have benefitted as they were able to enhance the illumination on roads, reduce energy and maintenance costs without having to invest in procurement of lights.
The repayments to EESL are being made from savings in energy and maintenance costs. In the state of Gujarat, ULBs will receive 40% of energy savings without having to bring in upfront capital investment.
In the recently commissioned South Delhi Municipal Corporation (SDMC) project, which is the largest in the world with 2 lakh lights, there has been a reduction of 14 MW of load (58%), monetary savings to SDMC of Rs. 60 crores annually. The energy consumption has reduced by over 55%. Similar is the experience in nearly 11 states where the programme is currently ongoing including Gujarat.
EESL said the programme has helped all stakeholders and has been implemented keeping the highest standards of professionalism, integrity, transparency. “The programme has been acclaimed internationally as one of the best practices of innovative service model, transparency by putting monitoring in public domain, scalability and commercial sustainability by demonstrating a model that does not require public funds to implement energy efficiency,” it added.