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STRATEGICALLY SPEAKING:
Insights Into LEDs & Lighting, from Strategies Unlimited
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VRINDA BHANDARKAR
Many energy efficiency programs have been promoting compact fluorescent
lamps (CFLs) to reduce energy use. Rebates and discounts by major
retail outlets have dramatically increased shipments of CFLs in the US
— from 5% of the total lamps bought in 2004 to 23% in 2007. The U.S.
Environmental Protection Agency (EPA) estimates that ENERGY STAR CFL
sales for 2007 were nearly double those in 2006.
However,
gains in efficient lighting have been fragile in the U.S. Sales of CFLs
have dropped in the current recession to 21% of total U.S. consumer
light-bulb sales in 2008 from 23% in 2007, according to the U.S.
Department of Energy (See Figure 1). The steep decline in CFL
shipments, even in regions that had invested in CFL promotions such as
Vermont and Massachusetts, is a cause of concern to all who aspire to
promote energy efficient lighting.
Figure 1
U.S. Lamp Shipments and CFL Market Share
Source: U.S. Department of Energy, analysis by D&R
international; CFL Shipments – U.S. Department of Commerce;
Incandescent Shipments – D&R, based on Navigant Lighting Study,
RECS, DOC.
There are many possible reasons for this decline in the market share of
CFLs. New users have not been added to the market as disposable incomes
have declined and customers are sensitive to higher prices Early
adopters bought the long-lasting CFLs and the rest of the market has
not followed suit Color quality issues of CFL persist and cannot be
overcome with incentives Fear of mercury in CFLs has not been
adequately addressed.
In order to promote energy savings, CFLs are heavily discounted
or are being given away, and incandescent bulbs are scheduled to be
banned in the U.S beginning in 2012 (they are already banned in
Europe). In spite of heavy investment in promoting CFLs, incandescent
technology has proved difficult to unseat, especially in the
residential segment.
There is no publicly available data on the number of CFLs that
are recycled, but in a report on CFL recycling programs around the
world published in July 2009 by the Northeast Waste Management
Officials’ Association (NEWMOA) [www.newmoa.org/prevention/mercury/lamprecycle/CFLRecyclingReport.pdf]
CFL recycling rates vary from 87% in Taiwan (which includes all
fluorescent) to 3% in 2004 in Canada. Only 2% of CFLs were recycled by
German households in 2008. There is increasing evidence that efficient
recycling of CFLs is going to require heavy investments in new
infrastructure and public education.
Although CFLs
were introduced in 1980s, they became a part of energy policy only in
this century. If it had been left to the markets, CFLs would likely
have made only a small dent in the market by now.
Today CFLs are the technology most closely associated with
energy- efficient lighting, but LED lighting has started gaining mind
share, at least in energy efficiency circles. The economic downturn has
dampened the rate of the transition to efficient lighting technology.
However, issues relating to global warming, energy security and
environmental degradation are now a part of the public psyche. Although
not many people have invested in efficient lighting, the awareness
about efficient lighting options has increased. The LED lighting
industry has continued to grow in spite of the economic downturn.
Since 2008, the price of HB LEDs has declined 10% to 25%. More LED
manufacturing capacity has been created. The quality of white LEDs in
terms of lumen output and CRI has improved. Warm white LED luminaires
are comparable in terms of quality of light with incandescent lamps,
but without their inefficiencies. However, the volumes have not yet
reached critical levels at which the costs can be as competitive with
CFLs.
There have been attempts around the world to design “demand pull” and
“supply push” strategies for CFLs. The rate of penetration is directly
proportional to the investments made in promoting CFLs. The outright
ban on incandescents with distribution of free CFLs in Cuba has paid
off. Similar strategies can be directed to LED applications that are
ready to be pushed into the marketplace with no fear of releasing
mercury. Moreover, LEDs can be used with controls that can offer
further energy savings that are not possible using available CFL
technology.
China has made developing LED technology one
of its national priorities. It has embarked on the 21-city program,
which will showcase LED applications, and it is expanding LED
manufacturing clusters to seven regions. The grand experiment with LED
streetlight installations is going through iterations, improving these
products in the process.
Just three years ago LEDs were too dim for street lighting; in 2009 Los
Angeles is installing 7,000 streetlights, with tens of thousands more
planned for following years. There is an expectation that the problems
relating to toxic material content, quality of light, and reliability
of performance, like those encountered by CFL products, can be avoided
by LED technology. There are agencies and organizations working to
prevent those problems in spite of market pressures to flood the market
with substandard products. This time it can be different.http://www.ledsmagazine.com/features/6/12/3
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