"Under the partnership, IIFC Projects Ltd (IPL) will provide EESL with debt syndication services, business development, capacity development services and project management services, in order to facilitate better and faster adoption...
of products of Energy Efficiency Services Ltd (EESL)," said a press statement.
IPL will also assist EESL in ideation, create market for new product lines to enhance the business potential of EESL, and modify and develop new strategies for both existing and new product lines.
EESL is a joint venture set up by the power ministry comprising four public sector undertakings-NTPC, PFC, REC and Power Grid - for implementation of energy efficiency projects in the country.
"This MoU marks an important step towards our commitment to energy efficiency and tapping potential in every possible sector in the country," EESL MD Saurabh Kumar said.
"We look forward to working more closely with IIFCL and we are very confident that their expertise will help EESL to achieve newer heights," he said.
IPL is promoted by India Infrastructure Finance Company Ltd (IIFCL), a PSU established with the main objective of channelising long-term finance to viable infrastructure projects.
IPL has an objective of providing end-to-end solution and services for all kinds of infrastructure projects.
The PSU has already scripted a success story by registering a phenomenal growth in the production of LED (light-emitting diode) lamps. These lamps are not only eco-friendly but also consume about 80 per cent less energy than incandescent bulbs.
EESL procures LED lamps in bulk through competitive bidding and distributes them to the consumers through power distribution companies. The PSU is also facilitating state governments in floating contracts for retrofitting LED street lights and maintaining them, creating market for Energy Service Companies (ESCOs). ESCOs is a concept popular in West but has remained a non-starter in India.
EESL too has scaled up its investment target 140 times to Rs 70,000 crore in the next five years from the earlier Rs 500 crore fixed about two years ago. The overall size of energy efficiency market is estimated to be Rs. 74,000 crores. The concept of performance contracting implemented by Energy Service Companies (ESCOs) is being increasingly considered as a mechanism to overcome some of the barriers hindering and discouraging the large-scale implementation of energy efficiency projects.