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India: Rajasthan Public Street Lighting
The project objective was to improve public lights system operated by the Jaipur Municipal Corporation (JMC) in Rajasthan (India), through a PPP scheme. JMC engaged IFC as the transaction advisor to structure a PPP for financing, upgrading, operating and maintaining the public lights system in Jaipur.
The project is built around the Energy Service Companies (ESCO) industry, applying performance based business models. A consortium led by a large Indian energy services company and manufacturer of LED lights won the bid for a 10-year energy performance contract. The project involves retrofitting the public street-lamps with energy efficient lamps and their operation and maintenance. It also allowed inclusion of additional lights, if required, going forward. In addition to the lamps, the ESCO will install a fully computerized centralized control and monitoring system as well as create a round the clock public grievance system dedicated to public lights. For these investments and services, JMC agreed to pay a share of the energy savings achieved by the ESCO.
The winning proposal after the bidding process included a commitment to invest approximately US $12 million for retrofitting at least 70,000 street-lamps with energy efficient LED lamps. Once completed, the project is expected to benefit 1.65 million people with improved street lighting and a reduction of GHG emissions by 36,750 metric tons/year. It will also result in $1 million per year in fiscal savings accrued to the Government due to reduced energy consumption.