Opinion: Ambitious Indian energy efficiency scheme launches in the UK

Opinion: Ambitious Indian energy efficiency scheme launches in the UK

Pratik Dattani, managing director of www.economicpolicygroup.com, looks at the uptake of renewable energy in India and the launch of the Ujala initiative in the UK:

Above: Neelima Jain (Regional Head – UK & Europe, EESL) and Sunil Kumar (Head of Chancery, High Commission of India in London) signing the first Ujala MoU in the UK at The Lalit hotel in May 2017.

When US President Donald Trump signalled that the US would be withdrawing its support from the Paris climate change agreement in June this year, he name-checked India a few times. According to the President, the agreement was unfair because India could significantly expand its coal production, while the US was shouldered the burden of reducing its coal output significantly.

In reality, India is on track today to meet and exceed the ambitious climate goals set at Paris.

Pratik Dattani
Pratik Dattani

The growth of renewable energy in India has been remarkable. India added nine gigawatts of solar power in just the past two years. Bloomberg New Energy Finance (BNEF) says that another 37 GW will be added by 2020.

Building an energy-efficient economy has been a centre-piece of the government’s ambitions in the last three years. The Power Minister Piyush Goyal recently said that all new vehicles sold in India will be electric-only by 2030 (the UK’s target is by 2040), and that it may become the first country in the world to use only LED products for lighting needs by 2019.

Its target is to replace 770m incandescent bulbs with LEDs by 2019 leading to an expected reduction in installed load of 20,000 MW with an annual estimated reduction of Rs 400 billion (£4.8 billion) in electricity bills.

The Energy Efficiency Services Limited (EESL), a joint venture of four state-owned power companies, was set up by the Ministry of Power to facilitate the implementation of energy efficiency projects. It is the implementation agency for the Ujala initiative to provide people with affordable energy-efficient appliances relative to market prices. EESL seems on target to achieve the 2019 figure, which is unprecedented in the world.

Through efficiencies of scale generated by nationwide procurement of LED products, Indian consumers today can buy nine-watt LED bulbs for 80 pence (compared to around £5 on the UK high street) and 20W LED tube light for £2.50 (over £40 in the UK).

Ujala launched in the UK earlier this year during a visit by Minister Goyal, hosted by the High Commission of India and the Federation of Indian Chambers of Commerce and Industry (FICCI), with the aim of bringing a similar approach to energy efficiency here.

Ujala is targeting housing associations and office blocks with the significant electricity requirements, even if they already adhere to A-rated energy efficiency standards.

It’s an innovative business model: Ujala’s team assesses the potential for energy savings to be made, it sources and installs the lighting with zero financial outlay from the business, and in return keeps a proportion of the energy savings made. Ujala’s first Memorandum of Understanding was signed with the High Commission building in London, which should see substantial, ongoing energy savings as a result of the assistance provided.

As the UK opens up to non-EU trading partners post-Brexit, initiatives such as these show the UK’s success in attracting businesses and innovation from countries such as India. Ahead of the Power Minister’s visit again to the UK in late 2017, its anticipated a number of significant UK businesses come on board with Ujala.

*Watch the full speech given by Minister of Power Piyush Goyal at the launch of Ujala in the UK by EESL, London.

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