Bachat Lamp Yojana (BLY) scheme is a very innovative scheme undertaken by Government of India which has brought together various stakeholders in the whole value chain of energy efficient lighting. This has been one of the pioneering initiatives based on leveraging revenues from international carbon markets. Apart from direct benefits of saving energy, it also has been acting as great catalyst for increasing awareness about switching to energy efficient means of lighting. This has led to increase in consumer awareness and indirect support to various manufactures in bolstering their production and sales to attain economies of scale.
BLY is a massive program which is spread out both in terms of geography and time span. For success of such humongous initiative involving so many stakeholders it is indeed very essential to pause and take tally of the impact created by the program and learn from it so as to be able to do course correction if required. This indeed is an opportune time to have this reflection for BLY.
BLY scheme was launched in Feb 2009 with the ambitious target of replacing about 400 Million Incandescent Light (ICL) with Compact Florescent Light (CFL) to bring the demand side energy efficiency. It was estimated that, once achieved, this will save the country 6,000 megawatts (MW) of power, or around Rs 25,000 crores. If we consider the avoided cost of setting up generation plants to produce this much power then the savings both in time and resources are even more captivating. The program's goal was to deliver CFLs at the cost of normal ICLs. The difference in cost was expected to be recouped by the sale of Certified Emission Reductions (CER) under the Clean Development Mechanism (CDM) of the Kyoto Protocol[1]. Under the scheme 60 Watt and 100 Watt incandescent Lamps are to be replaced with 11 to 15 Watt and 20 -25 Watt CFLs respectively. The scheme is very promising and sets a unique platform for a robust public-private partnership between the Government of India, private sector CFL suppliers and state level electricity distribution companies (DISCOMs). It provides a framework to distribute high quality CFLs at about Rs.15 per piece to a very large number of households in the country.
Bureau of Energy Efficiency (BEE) has successfully registered the BLY scheme on 29th April 2010 under UNFCCC framework as a CDM PoA to avail the CERs (carbon credits) benefit. CDM revenue is one of the most important and visible stream of revenue that is required for success of massive programs like BLY.
BLY scheme because of its enormity and complexity of operation faces lots of challenges. A few have been enumerated below based on our limited understanding and quick interaction with various stakeholders:
- As of now outreach of the BLY seems to have been limited to few states in India including Kerala, Andhra Pradesh, Punjab, Karnataka, Goa, and Delhi due to implementation issues. So far about 50 CPA have been added in these states under UNFCCC but CER benefit have not been availed by any of the CPA. As per our understanding till April 2012, about 25.9 Millions CFLs have been distributed directly under the BLY Scheme. As such the present annual market for CFLs in India is estimated to be around 300 million units.
- BLY scheme faces many challenges at distribution level. This may need to be looked into through proper institutional arrangement of distributing the CFL in the next five year plan (2012-17). Unlike BLY scheme, Indian railway CDM registered project “Improving Energy Efficiency in Railways' Residential Quarters – Southern and North East Region” has been quite successful in distributing CFLs to railway quarters and CDM verification is under process to avail the CDM benefit.
- BLY scheme may also face challenge in future at CFL manufacturing level. CFL manufacturers in India might have to progressively switch to making LED based light bulbs in coming years owing to change in technology and rising consumer demand for the same. LED lights though they are very expensive as of now have an edge over CFLs in terms of longer life and low maintenance costs. So it is vital to assess how to make necessary changes in the registered CDM PoA to accommodate the probable change of technology in future.
- Also CFLs like all fluorescent lamps use mercury as a vital component for their functioning, which, if not disposed of properly, has potential of causing damage to the public health and environment. Although MOEF does not mandate an EIA or any precautionary measures for CFL use, BEE under the Tri-partite agreement, requires all SSC-CPA implementer(s) to contribute to the prevention of mercury pollution from the CPA project activity. There is a need to assess how successfully this is happening and will continue to happen especially in face to dwindling revenue streams for the CFL distributors under this scheme.
Considering the current developments in CDM markets, status of Kyoto Protocol and economic scenario in developed countries especially Europe (who have been main buyers of CERs), benefit from CERs seems to have tapered off for the moment. This may have an adverse impact on the speed at which the program was spreading out all over India.
Hence it is time to critically analyse the both direct and indirect impacts created by BLY till now and assess what it can do in future for promoting energy efficient lighting solutions in India. All this would assist BEE in tweaking the BLY scheme so as to develop a more robust mechanism for achieving energy conservation targets during 12th Five year plan.
