ITI Limited quoted a price of ₹2,503 (~$38.50)/single phase smart meter to emerge as the lowest bidder in the second round of auctions conducted by Energy Efficiency Services Limited (EESL), a joint venture company of Public Sector Units of Ministry of Power and Government of India, to procure 5,000,000 smart meters. These smart meters will be installed over a period of three years in a phased manner in Uttar Pradesh and Haryana.

Genus Power and KEONICS were the second and third lowest bidders. Per tender guidelines, the EESL will ask Genus Power and KEONICS to match the L1 price (₹2,503 (~$38.50)/single phase smart meter). If they agree to match the L1 price, EESL will split the procurement of the single phase smart meter between the three bidders at a ratio of 50:30:20. In such a scenario, ITI Limited will supply 2,500,000 smart meters, Genus Power 1,500,000 and KEONICS 1,000,000 smart meters.

In the first round of auction, Larsen & Toubro (L&T) quoted a price of ₹2,722 (~$41.5)/single phase smart meter. During the two rounds of the auction, the price of single phase smart meter decreased by 8 percent.

According to EESL, 7 companies including L&T were invited for the reverse auction, where L&T has been outbid by ITI Limited, Genus Power and KEONICS.

This means L&T will not get the contract which it, earlier, stood to win. When contacted an EESL official explained, when there was open price bid, L&T emerged as the lowest bidder, but in the reverse auction round it lost out.

The same official had earlier told Mercom, “The tender has been a success and the prices quoted by the three lowest bidders is beyond expectation. The thought process is headed in the direction where we think if L&T can supply at such a low price then why not others. We have asked other low bidders to match L&T prices or watch how low they can go.”

The EESL official pointed out, when we asked others to match prices, they outdid themselves.

The EESL is procuring the smart meters and services of the system integrator with 100 percent investment and the utilities will make zero-investment. The repayment to EESL will be through savings resulting from enhanced billing efficiency, avoided meter reading costs. The average cost of meter reading is ₹40 per meter, which will be completely avoided.

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