How efficient, transparent processes are making LED bulbs under “UJALA” scheme affordable

How efficient, transparent processes are making LED bulbs under “UJALA” scheme affordable

Transparent procedures and competitive e-bidding by the government has brought down the prices of LED bulbs being distributed under the Unnat Jyoti by Affordable LEDs for All (UJALA) scheme in 16 States in the price range of Rs 75- 95.

The project, executed by Energy Efficiency Services Limited (EESL) and spearheaded by the company’s MD, Saurabh Kumar, procures high quality LED bulbs from leading manufacturers through a transparent bidding process. In the latest round of procurement, which ended on March 31, 2016, the lowest procurement cost was Rs. 54.90 (exclusive of taxes and administrative costs).

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The government, through aggregation and transparent procurement has achieved a rapid decline in LED prices. In the first round of procurement held in January 2014, EESL achieved the lowest bid at Rs 310. The prices for the subsequent procurements for other states, during September 2014 to February 2015, ranged between Rs 204 to Rs 104.

As on date, EESL has distributed over 10.77 crore LED bulbs across India and the programme have led to significant savings to the state and consumers who are using these bulbs.

The target of the programme is to replace all the 77 crore incandescent bulbs sold in India by LEDs. This will result in reduction of 20,000 MW load, energy savings of 100 billion kWh and Green House Gas (GHG) emissions savings of 80 million tons every year. The annual saving in electricity bills of consumers will be Rs. 40,000 crore, considering average tariff of Rs. 4 per kWh.

“EESL has pooled the prices of all the previous procurements since 2014 and passed on the direct benefit to the consumers across states,” said an official.

Various state-specific taxes and other administrative costs like distribution, awareness, etc are added to the pooled procurement price.

“Therefore, the cost of the LED bulb has been brought down to a price range of Rs. 75 – Rs. 95, after addition of administrative costs, distribution and awareness cost. The variation in the final cost of the bulbs is owing to the difference in taxes across states,” he said.

“The Government has ensured transparency and encouraged competition by using e-procurement of goods and services. This has resulted in significant reduction in transaction cost and time and enhanced process efficiency. This in turn has led to a much larger participation of bidders thereby increasing competition and reducing the procurement cost of LED bulbs,” said another official.

The UJALA scheme is being monitored in a transparent manner through a national dashboard (www.ujala.gov.in).

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Anupama Airy

Founder and Editor at EnergyInfraPost
Independent Journalist and Energy Expert.​ (Worked with leading mainline financial and national daily for 23 years.​)​ Also, Guest Contributor with busines​sinsider.in
Currently, Writing a Book for Penguin India Titled Greased Pole:How Politics and Lobbying Stifled India’s Energy Dreams. The author can be reached on anupama.airy@gmail.com (9810661825)​
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