New Delhi: In a boost to India’s efforts to transition to a low-carbon economy, the Global Environment Facility (GEF) will provide $454 million in funding for energy-efficiency projects run by state-owned Energy Efficiency Services Ltd (EESL).
This funding by the GEF, an international partnership of 183 countries, United Nations agencies, multilateral development banks, and international non-governmental organisations (NGOs), will help EESL’s projects mitigate 60 million tonnes (mt) of carbon dioxide emissions.
India is among the world’s most vulnerable countries to climate change.
The funding will be utilised for EESL’s programmes for street lighting, domestic lighting, five-star rated ceiling fans and agricultural pumps and also help diversify its portfolio.
“The project will receive a composite funding of $454 million comprised of a GEF grant of $20 million and co-financing of $434 million in the form of loans and equity, including a $200 million loan from the Asian Development Bank. EESL further proposes an Energy Efficiency Revolving Fund (EERF) for a sustainable funding mechanism of energy-efficiency projects," EESL said in a statement.
The energy-efficiency market in India is estimated at $22.81 billion.
According to information available on its website, GEF has provided over $17 billion in grants and an additional $88 billion in financing for over 4,000 projects in 170 countries.
“The GEF project further brings together many technical and financing partners including United Nations Environment (UN Environment Programme), Asian Development Bank (ADB) and Kreditanstalt für Wiederaufbau (KfW), which aim to mitigate 60 million tonnes of CO2eq (carbon dioxide equivalent), and will enable a total direct energy savings of 38.3 million gigajoules (GJ) by 2022 and 137.5 million GJ by 2032," the statement added.
In response to a query on India’s performance on reducing emissions, Naoko Ishii, chairperson and chief executive officer (CEO), GEF, said: “The political commitment made by your leaders is really inspiring, not only to India but to the global community."
India, the biggest emitter of greenhouse gases after the US and China, plans to reduce its carbon footprint by 33-35% from its 2005 levels by 2030, as part of its commitments to the United Nations Framework Convention on Climate Change adopted by 195 countries in Paris in 2015.
EESL, promoted by public sector firms in the energy sector—NTPC Ltd, Rural Electrification Corp. Ltd, Power Finance Corp. Ltd and Power Grid Corp. of India Ltd—is leading India’s energy efficiency programme seeking to reduce carbon emissions as part of its climate change goals.
“Today is a momentous occasion for India. We are not only walking the talk by implementing the world’s largest energy efficiency programmes, but have also gained global recognition and participation in our commitment," Saurabh Kumar, managing director, EESL, said in the statement.
The state-run firm has been offering large procurement contracts in the energy sector enabling businesses to leverage scale and achieve economy to bring down prices.
The massive scale of EESL’s energy efficiency programme has helped in reducing the price of LED lights significantly.
The state-run firm is also leading India’s electric vehicle procurement programme and is buying 10,000 electric cars.
“With the strong leadership of EESL and the Government of India, we believe fostering penetration of these clean energy technologies will help India leapfrog to a more sustainable future while helping reduce local and global emissions," Naoko Ishii said in the statement.