1. 1 October 12, 2010 ENERGY EFFICIENCY SERVICES LIMITED ENERGY EFFICIENCY IN ULB’s

2. ENERGY SAVINGS POTENTIAL IN THE STATE POWER SCENARIO OF UTTAR PRDAESH FOR 2007-08 INSTALLED CAPACITY9339.3 MW TOTAL ENERGY SALES45.41 BU PEAK DEMAND11104 MW PEAK MET8568 MW PEAK DEFECIT / SURPLUS -2536 MW (-22.8 %) ENERGY DEFICIT / SURPLUS -11293 MU (-18 %) *Including electrical energy consumption & savings potential of SME clusters S. No. Sector Reference Annual Electricity Consumption (MU) Estimated Annual Savings Potential (MU) 1.Agriculture56931700 2.Commercial610122 3.Municipalities1057229 4.Domestic13704.22740 5.Industries*16472.891152 Total37537.095943 ENERGY EFFICIENCY IS THE LEAST COST OPTION TO OVERCOME THE PEAK DEFICIT

3. 3 INSTITUTIONAL ARRANGEMENTS FOR EE  Energy Conservation Act enacted in 2001.  BEE created at central level in March 2002 to promote the efficient use of energy and its conservation.  State Designated Agencies (SDA) at state level for implementation of EC Act.  BEE and SDAs are to perform the role of a quassi-regulatory and policy advisory body to the State and Central Govt.  Till date 32 States have notified their SDAs.  Energy Efficiency Services Limited formed in December 2009 to implement energy efficiency projects in partnership with the private ESCOs.

4. 4 ABOUT EESL  Energy Efficiency Services Limited (EESL), a JV of NTPC Limited, PFC, REC and POWERGRID has been set up to facilitate implementation of EE projects and to be the implementation arm for Central government and state governments.  The authorized share capital of the company is Rs. 190 crores and the paid-up capital is Rs. 100 crores with equal contribution from all PSUs.  It is registered under the companies Act, 1956 on 10 th December 2009 and the commencement of business certificate is obtained on 11 th February 2010.  It is the first such government company exclusively for implementation of energy efficiency in South Asia and amongst a very few such instances in the world.

5. 5 EESL- OBJECTIVES  To facilitate implementation of energy efficiency projects for Demand Side Measures including municipal functions, agriculture, public building, lighting etc.  To implement schemes, programmes and policies of central and state governments or its agencies.  Implementing agency with private ESCO’s and other companies to promote energy efficiency.  To provide consultancy services in the field of energy efficiency, CDM projects, and other related areas.  To identify and impart training to build the capacity of stakeholders.

6. Implementing Govt. Programs Consultancy Organization Resource Centre ESCO EESL EESL- ROLES CDM Consultancy Energy Efficiency Potential Consultancy to SDAs/ Govt. International Consultancy Capacity building of SDAs Training of Energy Managers 3L Programmes Implementation of EE in buildings, municipality, agriculture, SMEs S&L Programme National Examination PAT scheme PRGF/ VCFEE

7. 7 Municipal EE Projects EESL as an advisor/consultant  EESL will prepare the Detailed Project Report  EESL will prepare the bidding documents and will facilitate in finalization of the implementing agency  EESL will facilitate implementation of energy efficiency projects by acting as a Project Management Consultant (PMC) and also as an independent third party M&V agency. EESL as an ESCO  EESL will prepare the Detailed Project Report.  EESL will invest in the EE projects by entering into a performance contract agreement with ULB/State Govt. Dept.  Investment will be recovered though reduction in electricity bills.  EESL will be responsible for implementation of EEM’s and O&M during the currency of performance contract

8. 8 LUDHIANA MUNICIPAL CORPORATION  90,862 street lights in LMC are to replaced with LEDs. A total of 881 switching points exists.  56% are 70W HPSV, 26% are 150W HPSV, 13% are 250W MH, 7% are 250W HPSV and the remaining are FTLs and CFLs.  EESL conducted the Energy Audits and prepared the DPRs.  The existing annual consumption is 45.72 MU, where as with LED and automatic switch control and dimmer the consumption will go down to 10.4 MU for annual avg. operating hours of 4015.  The estimated project cost is Rs. 66.00 crores including the cost for PMC and M&V, which are capitilized.  The project IRR is 14.82% with a SPB of 6 years.  Bids are invited from LED manufacturers / ESCOs / FIs for implementation of the project on performance contracting mode.

9. 9 ISSUES  Payment Security Mechanism  For successful implementation of energy efficiency projects through ESCO mode, payment security to the investor is very important.  It can be done through the creation of an escrow account by the State Govt.  As a PSM in case of default by the ULB, funds disbursed to ULB by the state government can be paid directly to the ESCO/investor  Revolving Fund  State Energy Conservation Fund can do part investment and will get repaid from energy savings without any profit  This will improve the Project IRR for the ESCO/investor  M&V  Third party M&V whose report is acceptable to ULB and the investor

10. 10 A.AS AN ESCO (i)BUILDINGS AND MUNICIPALITIES  There is a vast scope for energy efficiency improvement in buildings and municipalities. Energy efficiency measures bring about energy savings due to reduced energy consumption.  Investments will be recovered though reduction in electricity bills during the performance contract as per the third party M&V recommendation.  EESL plans to implement 50 Government Building efficiency projects and 5 Municipalities energy efficiency projects during this financial year. ACTIVITIES OF EESL

11. 11 ACTIVITIES OF EESL Commercial Buildings – 33 billion units Residential Buildings – 116 billion units

12. IMPLEMENTING EE IN BUILDINGS / ULBs SDA State Government  Policy Guidelines and Notifications  Capital investment to be paid back in equal installments to EESL  Savings, over and above the capital investment, shared with EESL and building owner Building Owner/ULB  Reduction in Electricity bill to be passed on to SDA  In case of baseline changes additional funds may be required  To be paid as per third party M&V EESL  Invest in Energy Efficiency  Operation & Maintenance till the performance contract period  Shared savings after the capital investment is paid Investment in the project Facilitate State Governments to issue guidelines Reduction in Electricity bill Third Party Monitoring Agency Sharing of savings

13. 13 (ii)AGRICULTURE  The overall energy efficiency investment market size of agricultural sector under performance contract system has been estimated at Rs 5,25,00 crores (total number of pumps 15 million and average cost of pump Rs 35,000).  EESL will invest in energy efficiency measures on a rural pump set feeder on which supply quality enhancements [such as feeder separation and High Voltage Direct Supply (HVDS)] have been carried out.  The investments will be for procurement and Operation & Maintenance of pumpsets during the performance contract.  The reduction in electricity demand due to implementation of the project will be shared between DISCOM and EESL as per contract agreement.  EESL plans to take up least two such project this year. ACTIVITIES OF EESL

14. IMPLEMENTING Ag DSM PROJECT 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 sets Reduced Energy Bills Free Maintenance Quality Power Supply Third Party Testing Agreement Utility / DISCOM Annual payment from Special DSM fund to support capital expenditure Sharing of savings to support operating expenses Improved Collection efficiency Reduced Losses and Peak Load EESL Capital investment for Installation of new pumps Design / Installation / Commissioning & R&M Demonstrate the energy savings Repair and Maintenance Payment Security Package Policy guidelines & Approvals Electricity sales Monitoring Agency Regulator

15. 15 (iii)BACHAT LAMP YOJANA  BLY seeks to provide CFLs to households at the price similar to that of incandescent bulbs and plans to utilize the Clean Development Mechanism (CDM) of the Kyoto Protocol to recover the cost differential between the market price of the CFLs and the price at which they are sold to households.  EESL will invest for implementing Bachat Lamp Yojana (BLY)  Distribution of CFLs in the project area at Rs. 15/- per CFL and collection of one incandescent bulb ACTIVITIES OF EESL

16. Empanelment of investor / BLY Developer with BEE Investor / BLY Developer and DISCOM identify SSC- CPA area Signing of Tri- Partite Agreement CPA validation by DoE Investor develops CPA-DD and submits to BEE Investor secures finance and sources CFLs CFL distribution by Investor / DISCOM / BLY Developer Project area monitoring as per CPA-DD CPA Verification and allocation of CERs by BEE IMPLEMENTING BLY SCHEMES

17. 17 Energy Audits and preparation of Detail Project Reports of facilities / establishments / industries etc. Preparation of bidding documents, assistance in bid evaluation for implementation through ESCO route. Preparation of state wise sector-specific annual energy savings plan. Preparation of waste heat recovery DPR’s in industries Project management consultancy for energy efficiency projects. EESL will provide consultancy / Advisory services for the various activities required in a CDM programme of activities namely Developing the CDM programme of activity documents Promotion of the Programme of activities Conducting market surveys as per UNFCCC guidelines Conducting monitoring surveys as per UNFCCC guidelines Forward and Spot Trading of CERs Developing Database management systems for each programme of activity B.CONSULTANCY  EESL will provide consultancy / Advisory services for the various activities in a CDM programme of activities namely Developing the CDM programme of activity documents Promotion of the Programme of activities Conducting market surveys as per UNFCCC guidelines Conducting monitoring surveys as per UNFCCC guidelines Forward and Spot Trading of CERs Developing Database management systems ACTIVITIES OF EESL

18. 18 Energy Audits and preparation of Detail Project Reports of facilities / establishments / industries etc. Preparation of bidding documents, assistance in bid evaluation for implementation through ESCO route. Preparation of state wise sector-specific annual energy savings plan. Preparation of waste heat recovery DPR’s in industries Project management consultancy for energy efficiency projects. EESL will provide consultancy / Advisory services for the various activities required in a CDM programme of activities namely Developing the CDM programme of activity documents Promotion of the Programme of activities Conducting market surveys as per UNFCCC guidelines Conducting monitoring surveys as per UNFCCC guidelines Forward and Spot Trading of CERs Developing Database management systems for each programme of activity C. IMPLEMENTING GOVT. SCHEMES Standards & Labelling  Right from receiving the applications to the processing of applications from manufacturers and check testing of samples drawn from the market will be handled by EESL.  EESL has taken up processing of applications of 3 products viz. Ceiling Fans, Colour Television and Pumpsets. Perform Achieve and Trade (PAT)  One of the initiatives of the NMEEE is Perform Achieve and Trade (PAT).  EESL has taken up the study for conducting “Baseline Energy Audit” of Designated Consumers. ACTIVITIES OF EESL

19. 19 IMPLEMENTATION OF CSR OF OTHER COMPANIES  As part of Corporate Social Responsibility, some of the companies have approached EESL to facilitate energy efficiency initiatives. EESL prepares DPR’s and implements low carbon and energy efficient projects like existing lamps in the villages with LEDs, LED street lights, Efficient lighting and water pumping in townships etc.  First such DPR for M/s Shapoorji Pallonji Infrastructure Capital Ltd. (SPINFRA) has been prepared for villages Chhara, Sarakhadi, Nanawadi, Kaaj in Junagad District of Gujarat state and is to be implemented by EESL. ACTIVITIES OF EESL

20. 20 SCOPE OF WORK FOR DPR ON STREET LIGHTS  No. and rating of Switching Point for Street lighting in the ULB.  Total length and width of street illuminated  Total No. and height of street Light Poles  Total No. and type of fixtures  Control Mechanisms employed, and no. of working hours at different seasons in the year  General study of HT & LT electrical power distribution system and to carry out actual measurement of the electrical parameters like voltage, current, active / reactive power, power factor/ Lux level etc. using calibrated instruments and find out energy conservation possibilities therein.  To review actual loading and load distribution on transformer and to assess possibilities of energy saving.  To review the voltage levels in street lighting systems, and suggest mechanisms for voltage optimization.

21. 21  To review rating and location of capacitor and suggest power factor improvement scheme and to carry out the harmonics analysis study and suggesting measures to mitigate it, if required.  Monitoring & Measurement of Electrical Energy Consumption (KWH & KVAH).  Measurement of lux level at different positions of the road. The measurement of existing lux levels will be carried out as per the standard 9-point approved methodology for street lighting. The minimum and the average lux will be calculated as per the prescribed formulae of the 9-point method.  Analysis of the reduction in Electrical Energy Consumption (KWH & KVAH) due to energy efficient lighting without compromising the present lux level based on technical parameters like power factor, lumen / watt, CIE Color Rendering Index etc. SCOPE OF WORK FOR DPR ON STREET LIGHTS

22. 22  A study to be carried out by placing LED in at least three fixtures to obtain real data.  Providing a list of energy efficient LED street light manufacturers / suppliers.  Providing a list of ESCOs / FIs who may be interested in bidding for the implementation of this project in joint collaboration with LED street light manufacturers / suppliers.  Cost-benefit analysis showing the simple pay-back period, Return on Investment (RoI), Net Present Value (NPV) and Internal Rate of Return (IRR).  The apporx. cost for preparing DPR on street light will be around Rs. 9.00 lakhs for a MC having 1,00,000 street lights. SCOPE OF WORK FOR DPR ON STREET LIGHTS

23. 23  Discussion with all relevant stakeholders viz. ULB/ PHE Dept., consumers, distribution utility etc.  Name plate details of existing pump sets, delivery valve position, foot valve status / condition and other details.  To provide an overview of existing facilities and current operating system like electrical distribution system, metering system, power tariffs and subsidy, if any, electricity availability, seasonal as well as historical water level variation pattern.  Detailed energy audit (performance evaluation) for all pump sets in each of the water supply schemes in urban and water supply schemes in rural areas will be carried out by measuring the suction & discharge head, power input and water flow to evaluate operating efficiency of the pump sets. Based on audit study an efficiency index for the existing pumping system will be prepared. SCOPE OF WORK FOR DPR ON WATER PUMPING

24. 24  Other parameters and site conditions like delivery valve position, working of foot valve and type of piping etc., will also be studied.  The capacity and type of new energy efficient pump sets that can replace the existing pumps for the same discharge will be decided based on field studies after evaluating the existing pump set performance and operating efficiency.  Interaction with various pump manufacturers / suppliers will be made to understand the selection criteria, impact of changing water levels on the pump set efficiencies, input power and to study the pump curves. During the interaction the efficiency range of different types of star labelled pumps along with technical details, budgetary quotes, suppliers of spare parts etc. will also be discussed. SCOPE OF WORK FOR DPR ON WATER PUMPING

25. 25  The energy saving potential that can be achieved by replacing existing pumps with that of best efficiency pump set will be quantified based on the analysis of the measurements. In addition to this various technically sound and economically viable measures to improve the end-use energy efficiency like optimum sizing of pump sets for the same discharge, change of foot valve and change of piping system etc will also be provided in the energy audit report.  The cost estimate for preparing DPR in one water supply scheme in Urban having around 100 pumps ranging from 2HP to 50HP will be around Rs. 5.50 lakhs.  The cost estimate for preparing DPR in one water supply scheme in Rural having around 10 pumps ranging from 2HP to 50HP will be around Rs. 35,000/- SCOPE OF WORK FOR DPR ON WATER PUMPING

26. 26 SCOPE OF WORK FOR PREPARING BIDDING DOCUMENT & FINALIZATION OF AGENCY  Finalization of the Detailed Project Report in consultation with Municipal Corporation.  Preparation of bidding documents including technical specifications for energy efficiency projects and drawings etc.  Preparation of Notice Inviting Tenders (NIT).  Replying to queries from bidders.  Assist in evaluation of bids received and selection of implementing agency by ESCO mode.  Preparation of performance contract agreement document.  Advisory services for acceptance and finalization of contract with implementing agency.  Cost for preparing bidding document and finalizing implementing agency for one MC for street lighting & water pumping will be around Rs. 2.50 lakhs.

27. 27 SCOPE OF WORK FOR PMC  Deputing an official on as and when required basis at location to oversee the progress of the implementation of the project as required by the Municipal Corporation.  Quarterly progress reports to be submitted to MC intimating the progress of implementation.  To assist scrutiny of running payments and final bill of the implementing agency.  To verify the data/ details submitted by the implementing agency.  Clearance of payments due with the implementing agency.  Advisory service at Physical Completion.  Advisory services on M&V evaluations and plus/minus payments due with implementing agency.  The cost of PMC & M&V will be capitalized as the project cost.

28. 28 Visit us at www.eesl.co.inwww.

29. 29 COST ESTIMATE FOR PREPARING DPR Item Charged Rate (Per Month) DaysValue Professional Expenses (On-Site) Certified Energy Auditor / Manager (1 no.)INR 1,50,00045INR 2,25,000 Energy Analyst (1 no.)INR 1,00,00045INR 1,50,000 Sub-TotalINR 3,75,000 Assumption: On site manpower cost includes professional fees, data collection and measurement, consultation with stakeholders etc. of the expert man powers to be deputed by EESL. Professional Expenses (Off-site) Certified Energy Auditor / Manager (1 no.)INR 1,20,00045INR 1,80,000 Energy Analyst (1 no.)INR 80,00045INR 1,20,000 Sub-TotalINR 3,00,000 Assumption: Off site manpower will be involved in analyzing the data collected and preparing the DPR and other administrative expenses. Logistical Expenses Travel and stay of the experts deputed and also for officials from EESL --INR 1,85,000 Assumption: Deputed Experts will make to & fro travel from headquarter to the site, will to have stay for the duration of surveys, data collection etc. EESL officials will also make to and fro travels. Professional Charges of EESL Officials 10% of total (approx)INR 86,000 GRAND TOTAL (Indian Rupees Nine Lakhs and Forty Six Thousand only) – exclusive of all taxes INR 9,46,000

30. 30 COST ESTIMATE FOR PREPARING BIDDING DOCUMENT & FINALIZATION OF AGENCY Item Charged Rate (Per Month) DaysValue Professional Expenses (On-Site) Certified Energy Auditor / Manager (1 no.)INR 1,50,0007.5INR 37,500 Energy Analyst (1 no. )INR 1,00,0007.5INR 25,000 Sub-TotalINR 62,500 Assumption: On site manpower cost includes professional fees, data collection and measurement, consultation with stakeholders etc. of the expert man powers to be deputed by EESL. Professional Expenses (Off-site) Certified Energy Auditor / Manager (1 no.)INR 1,20,00022.5INR 75,000 Energy Analyst (1 no. )INR 80,00022.5INR 60,000 Sub-TotalINR 1,35,000 Assumption: Off site manpower will be involved in analyzing the data collected and preparing the DPR and other administrative expenses. Logistical Expenses Travel and stay of the experts deputed and also for officials from EESL --INR 31,500 Assumption: Deputed Experts will make to & fro travel from headquarter to the site, will to have stay for the duration of surveys, data collection etc. EESL officials will also make to and fro travels. Professional Charges of EESL Officials 10% of total (approx)INR 22,900 GRAND TOTAL (Indian Rupees Two Lakhs Fifty One Thousand and Nine Hundred only) – exclusive of all taxes INR 2,51,900