The LED Revolution and UJALA

LED bulbs use far less electricity than old incandescent bulbs and last much longer. But in the early 2010s, they were expensive in India.

UJALA

In January 2015, the government launched UJALA (Unnat Jyoti by Affordable LEDs for All), run by Energy Efficiency Services Limited (EESL), a public sector company.

How it worked

• EESL bought LED bulbs in huge bulk orders through competitive tenders.
• Large volumes drove down prices.
• Bulbs were sold to households at low prices, sometimes with payment in instalments through electricity bills.

Results

• LED bulb prices fell sharply, from around 300 rupees or more to well under 100 rupees.
• Over 36 crore LED bulbs were distributed under UJALA.
• The wider market also shifted, as private sellers cut prices and LEDs became the norm.
• Estimated energy savings of many billions of units of electricity a year and large cuts in carbon emissions.

Street lighting

A similar programme replaced street lights with LEDs in cities, cutting municipal electricity bills.

Why it worked

• Economies of scale in procurement.
• Demand aggregation: the government acted as a big buyer.
• Market transformation: once prices fell, private markets took over.

Lessons

Bulk procurement and early demand can bring down prices of new technologies, a strategy applied to electric buses and other products.