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“What an investment banker like Goldman Sachs does is that it signs up with a lamp manufacturer and a utility company, say for two million CFLs. The manufacturer delivers the two million CFLs free of charge to consumers. The investment banker pays the company and in return gets paid out of the instalments deducted from the bills paid by the consumer over a period of twelve months or so. The investment banker also earns revenues out of the carbon credits earned for the project,” said Verma explaining the model.
“It has started but in India there is still time for the programme to be understood first and then be implemented,” he added.
Dealing with mercury
Today, the biggest environmental concern from the lighting industry’s perspective is mercury as most light sources use mercury. One issue in this regards is of course the usage of mercury in the manufacturing process.
“The industry has taken efforts towards reducing the content of mercury in the lamps. As an industry, we are also stepping up technology and stepping up innovations to ensure that we are within the norms of the international fraternity. Some day the European norms will come to India,” Verma said.
The second issue is related with the safe disposal of hazardous waste. The Waste Electrical and Electronic Equipment (WEEE) Directive has included CFLs in this category. The Indian lighting industry is in talks with the Ministry of Environment to determine what should be the norms for safe disposal of hazardous waste in India.
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“In Europe it is very easy as waste management of hazardous materials is becoming an industry there. So collecting fused CFLs and disposing them has become a business in Europe. Also, the user in Europe is more aware and disciplined than the Indian counterpart. The utility there too has a mechanism of collecting and disposing such materials. Europe is in fact moving towards a stage where the lighting industry will be collecting these lamps and giving them to the converters,” explained Verma.
In India, however, we have a long way to go. There is a lot of need to create awareness amongst end users. “Not many people in India are aware that it is not proper to break a tube light or a CFL in the open. Mercury is immediately released in the environment the moment it is broken and then no method of disposal can prevent the harm. We are working with the government to see how the government can implement a mechanism to collect the fused lamps or tubes as currently neither the consumers nor the rag pickers are aware of the hazard associated with these materials,” Verma added.
The CFL market
The Indian lighting industry has now realised the importance of CFLs. Earlier, influx of Chinese products used to be a menace but not anymore. “That’s because anti-dumping duty has been imposed and if we get products from China then we get top quality products. So that’s not an issue anymore,” Verma said.
“Today, the CFL market is the largest growing segment in the lamp industry and is growing at the rate of 25-30% year-on-year. We estimate the market to be around 200 million+ in pieces,” explained Verma.
Verma’s company Crompton Greaves too has a small but noteworthy presence in this segment. It is still small in this segment because it entered this market late – about two years ago. “But we have registered a very fast growth – from 1.3 million pieces when we started to about selling 10 million this year. We have invested in the manufacturing set-up and we are increasing capacity,” he informed.
Crompton Greaves is likely to become a key player in the CFL segment because not only is the Group doing exceptionally well overall but also the lighting business will continue to be its core division. In terms of the market scenario, Philips is the market leader in the CFL segment by brand. However, Phoenix leads the market when it comes to manufacturing capacity.
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