Tuesday, March 06, 2007

Light-bulb industry at a "tipping point"

The Associated Press

AMSTERDAM, Netherlands — European light-bulb makers are close to an agreement in principle to work together on phasing out energy-wasting incandescent bulbs for the consumer market, the chief executive of Royal Philips Electronics' lighting division said Monday.

Philips is the largest lighting maker globally, followed by Siemens, known for the Osram-Sylvania brands. General Electric, whose founder Thomas Edison patented the incandescent bulb in 1880, is biggest in the United States.

In a telephone interview, Theo van Deursen said "the tipping point is very close, to be frank, for the [European] lighting industry" to agree on a phase-out of incandescent bulbs in the home. He said an announcement from a group of major producers could come as early as this week.

Energy-saving compact fluorescent lamps, or CFLs, were introduced decades ago, but their adoption has gathered momentum recently amid worries about human impact on global warming and rising energy costs.

Earlier this month, Australia's government announced plans to ban incandescent bulbs within three years, while a California lawmaker has introduced a bill seeking to do the same in the state by 2012. Last year, Wal-Mart, the world's largest retailer, began actively promoting the bulbs.

CFLs on the market today are around three times as energy-efficient as incandescent bulbs, and last much longer. But even though they save money in the long run and are more environmentally friendly, consumers have been reluctant to adopt them for a variety of reasons, most importantly because they cost more per bulb.

Van Deursen said that the European Union was "very positive about a call to action in September," and has asked member states to report on plans for using energy-savings bulbs by governments.

But the European industry hasn't agreed on a parallel push for energy-saving bulbs in homes.

Van Deursen criticized General Electric for a statement it published last week saying it planned to introduce a new generation of energy-efficient incandescent bulbs by 2010.

"I don't think we should wait until 2010, because there are alternatives available now," he said, adding that he didn't know the details of General Electric's plans, but he didn't believe traditional incandescent lighting has a long-term future.


"We believe there are better technologies going forward," he said. He predicted that halogen lights and CFLs will continue to gain market share in the medium term, but in the long term, light-emitting diodes, or LEDs — the same that power many flat-panel computer displays — will dominate the market.

LED lamps, which are up to 12 times as efficient as incandescent bulbs, last even longer than CFLs and can produce light in any color, are only now being introduced to the market as a high-end product.

The GE statement said that the company has invested $200 million over the past four years in energy-saving bulbs. Van Deursen said Philips' investment level has been "at least twice that."

Philips lighting reported operating earnings of $834 million on sales of $7.18 billion in 2006.

Van Deursen said consumer lighting isn't a large enough component of the company's earnings for wide-scale adoption of energy-saving bulbs to dramatically affect the company's bottom line, though he said it could make a major contribution to reducing global energy usage.

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