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SEEP initiative: World Bank to help slash your electricity bills

According to reports, a World Bank-aided initiative of the Bureau of Energy Efficiency will soon be considered for approval by the Cabinet Committee for Economic Affairs, which will is expected to cause production and sales of super efficient electrical appliances in India.

CCEA will consider the proposal to let government of India provide Rs 100 crore, to supplement the Rs 250 crore from World Bank. These funds will be used to incentivise manufacturers of electrical appliances, such as ceiling fans, refrigerators and air-conditioners, to make products that consume extremely low amounts of electricity compared with those in the market today.

“It is in the very advanced stages and is likely to be launched soon,” Dr Ashok Kumar, Energy Economist with BEE, who oversees the ‘Super Efficient Equipment Programme’, told Business Line today.

Technology has made very steep cuts in energy consumption in households possible, but these super efficient products will be more expensive until such time as they are made in sufficiently large numbers. BEE’s Super Efficient Equipment Programme aims to do give manufacturers a sum of money per unit of appliance sold, so that they don’t have to sell the super efficient products at a higher price than the normal products in the market.

For starters, the Super Efficient Equipment Programme will cover the most ubiquitous of electrical appliances—the ceiling fans—though over time, it will be extended to other appliances as well. Some 30 million ceiling fans are sold in India and most of them are of 70 watts. Super efficient fans that deliver the same amount of air but are twice as efficient (or, 35 watts) will be eligible for the incentive.

Prayas Energy Group, a Pune-based think-tank, which has been assisting the BEE on this initiative, calculates that with super efficient fans, the ‘cost of conserved electricity’ works out to 63 paise per kWhr, while the average cost of generation of power in India is Rs 2.30 a unit.

Lamps and ceiling fans account for more than half of electricity consumed by all electric appliances (table). Though lamps drink more electricity than the fans do, the SEEP starts off with fans presumably because the incremental cost of higher efficiency is not much—about Rs 300 per fan. High efficiency lamps cost much more—a LED lamp that can give the same light as a 25 W filament bulb costs Rs 450; a CFL lamp equivalent to 75 W filament bulb costs Rs 130.

So, start with ceiling fans, where you get a bigger bang for your buck.

Several appliances manufacturers are looking at super efficient technologies, and the SEEP initiative will help them get there quicker. Dr Kumar said the SEEP would not prescribe any technology—BEE would leave it to the manufacturers. But most fan manufacturers are looking at fans with ‘brushless direct current’ or BLDC motors, which are said to be very energy efficient. P S Tandon, Executive Director, Consumer Products, Bajaj Electricals told Business Line that his company would “definitely launch” BLDC fans within one year. Initially, Bajaj will be buying the motors from abroad and “we don’t mind subsidising the prices” because over time costs will come down with higher sales, Tandon said.

Usha International, whose 43 W fan recently won the first prize at the National Energy Conservation Awards, 2013, is also looking to launch BLDC motor-based fans. Rohit Mathur, Senior Vice President at Usha said the company had been working on it for over a year.

Experts call for quick rollout of the programme and its extension to other appliances. In a paper prepared in April last year, Prayas has warned about the costs of delaying the SEEP initiative. “If a refrigerator saves 100 kWh/year and it runs for 10 years, it will save 1000 kWh/year over its life. So, if a million refrigerators are sold per year, an opportunity of annual saving 1 billion units is lost if the program is delayed by a year,” it said.

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