The World Banktoday announced it has approved a Rs 2,040 crore (US $300 million) assistance to help scale up India’s energy efficiency program. This includes Rs 1,496 crore of loan and additional Rs 544 crore to be provided as guarantee for projects, reported by ETEnergyworld.
To be implemented by the Energy Efficiency Services Limited (EESL), the program will help scale up the deployment of energy saving measures in residential and public sectors, strengthen EESL’s institutional capacity and enhance its access to commercial financing, an official statement said.
India’s climate change commitments to reduce carbon intensity by 33-35 percent by 2030 from 2005 level will require a significant focus on energy efficiency improvements. The investments under the program are expected to avoid lifetime greenhouse gas emissions of 170 million tons of CO2 and contribute to avoiding an estimated 10 Gigawatt (Gw) of additional generation capacity.
This would be over 50 per cent of the National Mission for enhanced energy efficiency target of 19.6 Gw indicated in India’s Nationally Determined Contributions (NDCs) under the Paris Accord.
The key components of the operation include creating sustainable markets for LED lights and energy efficient ceiling fans; facilitating well-structured and scalable investments in public street lighting; developing sustainable business models for emerging market segments such as super-efficient air conditioning and agricultural water pumping systems; and strengthening the institutional capacity of EESL.
Moreover, the Program will help to increase private sector participation in energy efficiency, including through private sector energy service companies.
Under the Program, EESL will deploy 219 million LED bulbs and tube lights, 5.8 million ceiling fans, and 7.2 million street lights, which will be supplied by private sector manufacturers and suppliers.
As an integral part of the operation, the first-ever International Bank for Reconstruction and Development (IBRD) guarantee in India will help EESL access new markets for commercial financing in line with the Bank’s approach of maximizing finance for development. The guarantee is expected to leverage around $200 million in additional financing, to help EESL with its growing portfolio and future investment needs.
Demand for energy end-use appliances and equipment like lighting, ceiling fans, air conditioners, refrigerators, agricultural pumps, and industrial motors is projected to grow significantly in India. So far, through the Unnat Jyoti by Affordable LEDs for All (UJALA) program, EESL has already deployed more than 295 million LED bulbs, resulting in avoiding over 7,500 Mw of new electricity generation capacity and bringing a significant drop in retail prices of high quality LED lightbulbs.