Innovation and the scaling-up of low-carbon technology is an integral aspect of the global need to address climate change.
But, this could be particularly challenging for large developing nations like India. The reason is that climate mitigation technologies are costly upfront while developing rapidly depends on low-cost large-scale energy sources that typically, are fossil fuels.
The poorer countries typically have less capacity to develop and manufacture the most cutting-edge low-carbon technologies on their own and, consequently, have to import these technologies.
To meet the goals of global climate change an important question needs to be answered: how do developing nations rapidly expand their use of technologies that are energy efficient while also improving their technology capabilities?
In a recent research paper released in Energy Research & Social Science, This research paper examines this issue by analyzing the rapid growth in India’s light emitting (LED) lighting market.
Check LED wholesale Prices in India online before buying.
Prices are Falling and the Market is Growing
Light bulbs are among the most widely used electrical appliances in the world and consume around 15% of all world’s electric power.
In the last decade, the lighting market in the world has been moving to LED lighting technology, which can be up to 75 percent more efficient in energy use than conventional incandescent and Compact fluorescent (CFL) bulbs.
As per the Organisation for Economic Co-operation and Development (OECD) the global prices for LED bulbs have decreased by a factor of ten over the past decade.
Our study is jointly published through our institution, the Smith School of Enterprise and the Environment, the University of Oxford and the Belfer Center for Science and International Affairs, and the John A.
Paulson School of Engineering and Applied Sciences, Harvard University, analyses the massive growth in LED usage in India between 2014 and 2018.
The market for LED lighting in India grew by 130 percent in just five years, increasing from annual sales of 5 million bulbs annually in 2014 to 670 million in the year 2018. This led to 30 terawatts (TWh) of annual energy savings, which is roughly enough to power 28m Indian households or the entire of Denmark for the entire year.
The cost of LED bulbs in India was also drastically reduced from around to 400 Indian rupees (around PS4.50) in 2014 to around 70 rupees (PS0.78) only five years later.
In the same time frame, the quantity of LEDs available in India has grown dramatically. As the graph below illustrates the market share of LEDs (yellow line) increased from 0.3 percent up to 46 percent, sales exceeding those of the incandescent (blue), CFL (orange), and tube light (green) lamps in the year 2018.
Since LED lamps were “cheaper than bread”, India went through a transformation in lighting that had huge benefits for energy consumption in the country in addition to CO2 emissions.
The market for LEDs has grown due to the increase in electricity access in India in 2017, 93 percent of the population was able to access electricity in comparison to 70% in the year 2010. There is a rising trend of beginning LED use among low-income households.
In certain regions, like Uttar Pradesh, households have been able to transition from not having electrical lighting directly to LED lighting, and without using power-intensive bulbs.
As of 2017, coal produced 76% of the electricity in India which is why LEDs play a crucial part in enabling access to electricity without a carbon footprint.
This dramatic change was made in spite of the fact India is not equipped with its own manufacturing facility for commercial production of the LED chip or integrated circuits, two essential components of the bulb.
Evaluating India’s Rapid LED Market Expansion
To comprehend the rapid growth of India’s LED market growth we looked into the strengths of both the demand and supply aspects in the Indian LED market.
In addition to the wide range of policies related to LEDs such as research and development institutes infrastructure, spillovers and spillovers from other sectors and financing. (These are collectively known in academic writing as “technological innovation systems” or a “technological innovation system”.)
The primary driver behind the rapid growth of India’s market was a government initiative called “Unnat Jyoti by Affordable LEDs for All” or “UJALA”, which procured LED bulbs for India’s national market.
The LED price was reduced by bidding on competitive auctions, which allowed these bulbs to sell for profit and at lower prices than retail by kiosks as well as registered sellers.
But, one of the key drivers of the success of the policy was China’s ability to produce LED bulbs and the components on huge scales at affordable prices.
In the event that the local LED bulb production and assembly industry was not able to grow as quickly as the marketplace, India relied on imported LED bulbs and other components.
The attempts to establish manufacturing equipment for the LED chip as well as driver-integrated circuits did not succeed in the face of low-cost imported components from China was impossible.
The UJALA program was designed with the sole purpose that was LED market expansion. This was achieved effectively, but not without consequences that were not intended.
Because of the intense competition to offer cheap prices and the resulting insufficient implementation of LED bulb quality standards general quality and performance of LED bulbs on the Indian market has decreased over time.
This has led to lower lifespans for each bulb, a missed opportunity to make longer-term carbon savings.
Looking Toward the Future
There is a chance for India to maintain its LED market growth while improving bulb quality and speeding up technological capabilities.
However, it will require more coordinated and strategic policy initiatives to tackle the shortcomings currently present in the field and take advantage of the strengths it already has.
Three lessons are learned for the future of technological innovation that is low carbon along with market development in India as well as other developing countries.
First, the experience of India in the expansion of LED bulbs indicates that policies that are narrowly focused even though they are beneficial in the short run can have unintended effects.
Although they can help one component of the low-carbon technology innovation system These policies can result in missed opportunities or unintended consequences for other components of the technology system.
So, a collection of policies that are coordinated would be more successful in rapid technological advancement and large-scale deployment of technologies to combat climate change.
The policy portfolio must to be able to reflect on strengths, weaknesses, as well as opportunities available for every stakeholder in the process of technology creation as well as research and development and application.
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Third, as emerging nations are expanding in their development as well as manufacturing capabilities, a significant problem is the absence of strong connections throughout the entire process of technology development which includes research at national laboratories, manufacturing the industry, and market expansion policies.
