India’s CFL makers boost capacity as demand soars

India’s CFL makers boost capacity as demand soars

New Delhi: Indian electrical product makers are building up compact fluorescent lamp (CFL) capacities as changes in consumer preferences and government support encourage a shift to energy efficient lamps.

Lighting consumes about 20% of electricity in India, and experts say a switch to CFL will help, for it uses only a fifth of the power of traditional bulbs for similar lighting.

“India produced just 60 million of the 100 million CFLs sold in 2006. Capacity is now fast rising by around 40% per year to catch up with the demand," said Shyam Sujan of Electric Lamp & Component Manufacturer’s Association (ELCOMA).

Indo Asian Fusegear Ltd plans to raise its capacity four fold by 2012 from 30 million pieces per year, Managing Director V.P. Mahendru told Reuters.

Havells India Ltd expects to make 60 million pieces per annum next year, up from current 36 million pieces per year. Bajaj Electricals Ltd in March acquired a majority stake in Starlite Lighting Ltd, to ease CFL sourcing.

Phoenix Lamps Ltd has a marketing deal with battery maker Eveready Industries India Ltd for wider market.

An energy conservation drive, replacing conventional lighting in government organisations, public places and commercial establishments is also fuelling CFL demand.

Power utilities in Andhra Pradesh and Haryana have partnered makers to provide cheaper CFLs to spur wider use. A Haryana utility tied up with Osram, the lighting unit of Siemens, to supply 750,000 free CFLs in two districts.

India’s penetration rate of 2% in CFL compared with 15-20% in developed countries will see the segment grow at a compound annual growth rate of 50% over the next 10 years, First Global said in a research note.

The CFL segment is going to double its contribution to revenues of Indo-Asian to 20% this year, said Mahendru. Phoenix Lamps forecast a 40% jump in net sales for 2007/08 on robust CFL demand.

But runaway demand for CFL is also underpinned by a darker side. The mercury content in it, environmentalists say, makes disposal a serious health risk. An average CFL contains 5 milligrams of mercury.

Greenpeace advocates a ban on light bulbs to cut greenhouse gas emissions, and has submitted a model legislation to the power minister to set progressively higher standards for lighting efficiency and safe disposal practices.

“All manufacturers should be required to phase out hazardous substances in their CFLs as soon as environmentally sustainable alternatives are available, establish take-back schemes and ensure effective recycling of CFLs," Ramapati Kumar, a Greenpeace campaigner said in a statement on its Web site.

“We are soon going to start with an awareness campaign by printing on every pack that the product contains mercury and should be handled carefully at the time of disposal," said ELCOMA’s Sujan.

In two years a system would be put in place to collect used CFLs at the dealer and retalier level to be shifted to treatment facilities, he added.