21 Mar 2018

Tackling India’s cooling growth head-on: EESL’s expansion into district cooling and trigeneration

Having revolutionized India’s energy efficiency sector, the publicly-owned ESCO, Energy Efficiency Services Limited (EESL), is now turning its eyes towards trigeneration and district energy. Building upon its huge ongoing success in sectors such as lighting, where it has helped to lower Indian prices for LED bulbs by 45% and has taken five Indian States to be 100% LED, EESL is now exploring how it can best advance the nascent district cooling market. This decision is owing to the significant efficiency savings and other benefits of district cooling and the commercial viability of such a technology in India - a country which commissions 3 million square feet of commercial buildings a day.

EESL has partnered with the UN Environment-led District Energy in Cities Initiative as the National Coordinating Agency for the Initiative in India. EESL will apply the lessons learned as India’s leading energy efficiency programme, where its interventions aim to deliver competitive markets for efficient technologies with a more developed private sector, more diverse and innovative business models and fewer barriers to deployment. EESL can help to create such a market for district energy in India, from supporting cities and developers to planning for and developing new projects, to devising innovative business models that account for the system-wide benefits of district energy – particularly upstream benefits to the power system.

Speaking on the drivers for this new partnership, EESL’s Managing Director, Mr Saurabh Kumar remarked: “EESL is committed to strengthen India’s energy sustainability through new and innovative technologies. In association with UN Environment, we are now exploring cost-effective future-focused solutions that will enable localized, stable power generation simultaneously with electricity consumption. Trigeneration is such technology that has demonstrated its efficacy in meeting the growing demand for electricity in an efficient and clean manner.”

The environmental and economic impacts of accelerating demand for cooling and real estate in India are forcing a rethink of how cities are designed and energy consumed. Ongoing national programmes such as the Smart Cities Initiative are demonstrating city-led approaches to sustainability and efficiency. The Indian government’s recently announced plans to develop a National Cooling Action Plan show refreshing commitment to solving a problem many governments worldwide are not yet tackling head-on: out-of-control growth for air conditioning.

Mr Soumya Prasad Garnaik, EESL Chief General Manager noted: “EESL is focusing on district cooling systems which can reduce energy demand for cooling by up to 50 percent. District cooling systems can deliver diverse benefits that progressive cities are committed to providing for their citizens, such as clean air, local jobs, and cost savings. District cooling will be well integrated into the Smart Cities initiatives - improving efficiency and the quality of infrastructure, and thus delivering a more sustainable, liveable urban environment.”

EESL currently works with India’s power utilities to deliver an ESCO business model, ‘pay as you save,’ that incentivizes stakeholders to install efficient technologies below cost, compensated by the electricity savings deducted in consumers’ power bills. EESL uses their significant buying power to lower technology prices to a level where such a scheme is viable. Similarly, many district cooling operators globally model their tariffs to ensure customers pay less than if they had installed a similar quality stand-alone cooling system and the economies of scale and efficiency savings achieved by district cooling keep the cost down. In the Initiative’s pilot city, Thane, and other cities, numerous business models will be tested for district cooling, including combinations of international best practice and EESL’s unique and highly-effective model.

EESL has recently announced they will be a part of the project ‘Creating and Sustaining Markets for Energy Efficiency,’ US$ 454 million of funding for energy efficiency projects in India. The funding is projected to mitigate over 60 million tonnes of carbon dioxide emissions in India. To achieve this ambitious target, a mix of grants, loans and equity, as well as international technical and financial expertise, will be provided by the GEF, the Asian Development Bank, KfW and EESL, through the conduit of this dynamic partnership. As part of this, EESL will set up an Energy Efficiency Revolving Fund (EERF), a sustainable funding mechanism of energy efficiency projects in the country, and install super-efficient ceiling fans, trigeneration technologies and smart energy grids. These clean energy technologies will help India leapfrog to a sustainable energy future, while reducing local and global emissions and accelerating India’s progress on international frameworks, such as the Paris Agreement.

The Initiative and EESL look forward to working together to implement a transformative pilot program in India for district cooling. The Initiative’s partners that design, operate, promote and supply district energy systems globally have committed to support this effort, as have the Initiative’s 45 champion cities for district energy which can provide valuable insight on local and national policies and actions that can accelerate district energy.

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