The Hindu Business Line : Philips-Goldman Sachs consortium lone bidder for Railways’ CFL project

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Philips-Goldman Sachs consortium lone bidder for Railways’ CFL project

Green project
The Railways invited bids from CFL manufacturers to replace incandescent lamps with 26 lakh CFLs under the clean development mechanism benefit scheme

Mamuni Das
Anil Sasi

New Delhi, July 30 A consortium led by Philips and Goldman Sachs has put in the lone bid for the Indian Railways’ tender to replace incandescent lamps in 6.5 lakh Railway households with compact fluorescent lamps (CFLs) under a ‘green’ project.

The bid is currently under evaluation by the Finance Directorate of the Railways and further details of the bid are not yet available. “A final decision on the bid will be taken soon,” an official source said.

The Railways had earlier invited bids from CFL manufacturers to replace incandescent lamps with 26 lakh CFLs under the clean development mechanism (CDM) benefit scheme. CDM is a Kyoto Protocol process that allows developing countries to earn carbon credits by using technologies that reduce green house gas emissions. These credits can then be sold to developed countries.

The Railways wanted CFL manufacturers to replace incandescent lamps of 60 watts with CFLs of at least 15 watts, 100 watt lamps with CFLs of at least 18 watts in its residential quarters in 2008-2012. The bidder has to supply four CFLs per household and maintain them during the period.

The catch, however, is that the Railways had proposed no payments to the manufacturers and instead asked them to recoup their investments through selling the potential carbon credits by registering the project at the United Nations Framework Convention on Climate Change. The bidding process was on the basis of carbon credits that manufacturers would, in turn, share with the Railways.

The Railways, according to internal estimates, hopes to save up to Rs 130 crore from the switchover — a Rs 100 crore saving on energy bills and another Rs 30 crore that it would have had to pay if it were to buy CFL bulbs upfront.

Despite repeated attempts, Philips executives did not offer any comments on the issue. Domestic CFL manufacturers have stayed away from the project, citing ambiguous revenue streams and lack of clarity on the financial model.

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