Latest News | EESL Terminates Pact with Municipal Corporation Gurugram for Street Light Project

Gurugram, Sep 4 (PTI) Energy Efficiency Services Limited (EESL) on Monday announced the termination of its agreement with the Municipal Corporation Gurugram (MCG) for a street light project due to payment defaults.

"The total outstanding payment from MCG stands at INR 21.08 crore, with an additional late payment interest penalty of Rs 10 crore as of July 31, 2023," said a spokesperson of EESL.

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The agreement for the street light project was signed on October 2017 and EESL started installation of lights in March 2018.

By August 2018, EESL completed the installation of 55,000 lights "despite payments not forthcoming from MCG".

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The first part payment was made by MCG more than a year after the installation of the first phase.

"To date, approximately 82,000 LED street lights and around 800 Centrally Controlled and Monitoring Systems (CCMS) have been installed in Gurugram by EESL, maintaining an impressive uptime of more than 98 per cent, despite consistent payment defaults by MCG," the spokesperson said.

EESL has diligently reminded MCG officials to clear their dues through numerous correspondences and formal communications, but to no avail. Despite these challenges, EESL has upheld its commitments and generated substantial cost savings of Rs 35 crore for Gurugram over the past five years.

EESL issued a formal payment default notice to MCG on June 21, 2023, providing a 30-day cure period. However, MCG neither cleared the payment nor provided any timeframe.

"Consequently, EESL had no choice but to serve a termination notice on August 2, 2023, with an additional 30-day cure period until September 1, 2023. MCG has failed to fulfil their commitment as per the agreements. As a result, the contract automatically stands terminated from September 2, 2023," the spokesperson said.

MCG commissioner P C Meena and Vicky Kumar, Executive Engineer (Electric) of MCG, could not be reached for comments despite repeated attempts.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)