New Delhi: Larsen and Toubro Ltd (L&T) has won a Rs1,361 crore contract to supply 5 million smart electricity meters, according to state-owned Energy Efficiency Services Ltd (EESL), which is procuring the devices.
The contract to supply smart electricity meters at Rs2,722 a piece, the lowest bid, is about 40-50% lower than the current market rate, said EESL.
An email sent to L&T seeking comment remained unanswered at the time of publishing. Shares of Larsen and Toubro Ltd closed 0.14% lower at Rs1,140.90 on Monday on a day the Sensex rose 0.10% to end the day at 31,846.89 points.
These smart electricity meters will be deployed over three years in Uttar Pradesh and Haryana, the statement said. These two states have high level of losses from billing inefficiency, which the device can address.
The government has been offering large procurement contracts in the energy sector enabling businesses to leverage scale and achieve economy to bring down prices.
After having tested the strategy successfully in the case of LED bulbs, EESL is now testing it in the case of smart electricity meters and energy efficient air-conditioners.
Power distribution companies (discoms) will not have to make an upfront investment to deploy these meters. EESL is investing in procuring smart electricity meters and the services of the system integrator. Utilities can pay back through savings resulting from enhanced billing efficiency and avoided meter reading costs.
EESL will also appoint a firm, a “system aggregator", to manage the installation of smart electricity meters and to collect and store data on power consumption for analysis. Bids for the system integrator will open on 31 October, the company said.
Smart electricity meters will facilitate billing of customers based on the time at which power is consumed, which could encourage them to cut consumption during peak hours when power tariff could be set relatively higher.
Power consumption is usually high during the afternoon and at night. The power tariff policy allows such “time of the day" tariff although it has so far been implemented only for commercial customers.
For customers with a rooftop solar power generation facility, smart electricity meters will enable selling surplus power during the day to the grid, get credits and use it to pay for consumption at night.