CFL Economics

8/3/2019 CFL Economics

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1. IntroductionMuch of the world has become completely reliant on electricity. In fact, without electricity muchof the modern-day comforts we enjoy would no longer be possible. Unfortunately, many people

overuse or waste electricity, resulting in negative impacts on the environment. Saving energythrough simple measures, such as turning off lights in unused rooms and turning down the water

heater, can provide the environment with a wide range of benefits.

Energy saving Electric bulbs (CFL) vs. Energy consuming Incandescent Bulbs

A compact fluorescent lamp (CFL), also known as a compact fluorescent light or energy saving

light (or less commonly as a compact fluorescent tube), is a type of fluorescent lamp.

Many CFLs are designed to replace an incandescent lamp and can fit into most existing lightfixtures formerly used for incandescent. The typical household still uses incandescent light

bulbs, spending more amounts on electricity bills.

Use of compact fluorescent light (CFL) can reduce this expense markedly. Moreover, replacing

energy-hogging incandescent with energy-saving fluorescents (CFLs) is a simple, effective way

to slow the rate of global climate change while saving money. It's good for the environment, it's

economical, it's efficient, and it's easy.

How is light produced in CFLs?

CFL bulbs emit light that is a mixture of three phosphors exposed to ultraviolet light produced by

mercury atoms. This process is unlike incandescent bulbs, which use filaments.

Though CFLs cost more at the onset, they are tested to provide 8,000 hours of light as against the

500-2,000 hours from incandescent bulbs. Here is the mathan 18-watt CFL saves you from

purchasing ten ordinary 75-watt incandescent bulbs.

Mercury is used in many household items: thermostats, thermometers, fluorescent lights,

batteries and switches for appliances, lights and automobiles. Exposure to large quantities of

mercury in our air, water and fish we eat is a documented risk to human health.

An extremely small amount of mercury-an average of four milligrams-is sealed within the glass

tubing of a CFL. This is said to be about the size of the period at the end of this sentence.

It is an essential, irreplaceable element in CFLs, and it's what allows the bulb to be such an

efficient light source. The mercury in a CFL is no threat to the environment unless the glass is

broken.


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For a basis of comparison, there are about one to three grams of mercury in your average home

thermometer. It would take between 250 to 1000 CFLs to equal that same amount. Ironically, a

regular incandescent light bulb actually releases much more mercury into the environment than a

CFL.

Havells 23W (FU) B22 Lilliput CFL vs. Surya Regular 100 W Bulb

Havells 23W (FU) B22 Lilliput CFL

Havells India Limited, a US $1 billion plus enterprise and one of Indias fastest growingelectrical and power distribution equipment companies, after launching Indias First Eco-Friendly Green CFL, now introduces a new range of Green CFL called "LILLIPUT". As the

name suggests, it is the small in size and circumference, making it India's Smallest Eco-friendlyGreen CFL.

Lilliput range complies with RoHS (RoHS is European norms on Restriction of HazardousSubstances), CE (Certified European Approval) and is yet another initiative by Havells which

proves to be very economical for the end consumers and assists them in saving a significantamount of electricity as well.

Havells uses PDT (Pill Dosing Technology) for all its CFLs, in which amalgamated Hg pills are

used. These amalgamated pills contain Hg as per international standards. Being free from liquid

Hg where Hg dosing normally goes beyond prescribed limits in weight.

After launching CFL in late 2003, Havells has played pivotal role in revolutionizing Indian CFL

industry by taking many Firsts initiatives and bold steps. Havells today is one of the largestCFL manufacturers in India with fully integrated manufacturing facility, now being consolidated

at Neemrana (Rajasthan).

Havells Lilliput CFLs T-3 range is available in 11 W, 15 W, 20 W & 23 W with three base caps

such as B-22 for normal holders; E-27 for lamps shades, chandeliers and designer fittings, E-14cap. It is available in two colors cool day light and warm white. These are highly affordable

priced providing true value for money.

Surya Regular 100 W Bulb

Surya incandescent lamps commonly called as Light Bulbs are in use for over two decades andstill continue to be the most widely used lamps in the world. They come in various shapes and

wattages ranging from 10W to 200W. Depending upon the application area, they are available in

Clear, Frost Finished and Colour versions with Single coil or Coiled coil (as the case may be)

tungsten filament as per international standards and fitted with two integral micro-fuses forgreater safety.


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The coiled - coil filament increases luminous efficiency by over 10% and heat loss by convection

or conduction is thus reduced. The Glass envelops for lamps are being manufactured on latestRibbon Glass Plant from DEMA Engineering - UK (formerly known as GB Glass - UK)

resulting to glare-free light output. They emit a continuous spectrum of approximately 2800K

and a colour-rendering index approaching to 90.

Surya Incandescent lamps are made on world's most sophisticated, 100% Synchronized

Incandescent lamp lines from FALMA (Montena S.A) Switzerland, tested in accordance with theinternational standards in force and conform to the IEC 60064 - Tungsten Filament Lamps for

Domestic & similar General Lighting Purposes EN 60432-1-Safety and interchangeability

requirement of tungsten filament incandescent lamps for general lighting service and IndianStandard IS 418.

Comparison between the Havells 23W (FU) B22 Lilliput CFL & Surya Regular 100 W Bulb

Specifications Havells CFL Surya Bulb

Price Rs. 240 Rs.14

Lamp Wattage 23W (FU) 100W

Lamp Current (mA) 120 0.83

Base Cap B22,E27 E12

Standard Package 50 100

Apart from the product specifications, the major difference between both the products is the

prices of the products. However, later in the study can understand what the cost advantages are in

the future for Havells CFL, which is priced at Rs.240.


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2. Analysis and Interpretation of the Data

Results from the Interview of the Retailer

As discussed with the retailer, there are more consumers who prefer CFL over regular bulbs.

Even though the price of the CFL is much higher than the regular bulbs, there are many

consumers who understand the overall benefits of buying CFL.

In India, there are a few companies who deal in producing lighting equipments such as CFL and

Incandescent Bulbs. The major Players in this Industry are Philips, Havells, Surya, etc. Since this

industry has few players in the market and the product differentiation is not much, these players

can be classified under oligopolistic markets.

The major factor that influences a consumer in this case is the long term electricity savings that a

consumer gets. As the retailers suggested that they usually recommend the customers energysaving products like CFLs, however ultimately it is the customer who has to take a decision on

the basis of his preferences.

The other factors such as price also play an important role, since the price of a CFL is much

more expensive than the price of a regular incandescent bulb. Some customers behave rationally

by buying an energy saving product at higher price keeping in mind the long term benefits of the

product.


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Results from the Questionnaire to the Customers

There was a survey done in the city of Pune, a questionnaire was filled by 20 consumers who

have used both CFL and Incandescent Bulbs. Following were the outcomes of the Questionnaire;

There were over 12 customers who agreed that the consumption rate of Regular bulbs was much

more than the CFLs and also they change their lightings almost twice a year.

The Average daily usage as answered by around 9 consumers, was around 8 hours a day, which

is a lot of time of consumption and so there is a need of energy saving lightings, such as CFLs.

When asked about their preference between CFL and Regular incandescent Bulbs in future,

almost 16 customers agreed to use CFL even though they are available in the market at a higher

price.

Around 12 customers rated cost savings in the future as the most important factor for the

product, which means that the customers dont mind paying more , however they would not

compromise on the long term cost benefit of the product.


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Savings for the Customers using CFL over Incandescent Lamps;

While incandescent lamps convert 95% of electricity into heat, and only 5% into light,CFL convert more than 80% electricity into light. Hence less loss of energy as heat.

CFL work without any problem in a wide voltage range (170 - 250V) thus having in-built resistance to power fluctuations. Generate 80% less heat, hence reduces load on air-

conditioners.

CFL consume less energy (70-80%), thus saving on electricity bills and low maintenancecost.

Each kWh saved equals average saving of 0.8 Kg Carbon Dioxide in energy productionby gas, coal, fuel power plants thus conserving natural resources.


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The following table illustrates the savings for a consumer ;

Sr.

No.Tariff Rs. 5/- per unit Tariff Rs. 4/- per unit Tariff Rs. 3/- per unit

Period of operation in hours 1000 3000 1000 1000 3000 1000 1000 3000 1000

Saving in power per lamp 60W - 11W = 49W (Considering 60W GLS = 11W CFL with Ballast)

1.Saving in energy 49 hrs1000= kWh or units.

49 147 490 49 147 490 49 147 490

2. Cost of energy saved per lamp 245 735 2450 196 588 1960 147 441 1470

3. Cost of CFL 325 325 325 325 325 325 325 325 325

4. Cost for GLS 12 36 120 12 36 120 12 36 120

5.Net cost per lamp

Cost of CFL - Cost of GLS313 289 205 313 289 205 313 289 205

6. Net saving per lamp -68 446 2245 -117 299 1755 -166 152 1265

7.

Average interest earned on

saving of energy cost @ 18%p.a. on 2 for respective hrs.

5.03 15.10 50.34 4.03 12.08 40.27 3.02 9.06 30.21

8. Interest lost on the netinvestment in CFL @ 18% p.a.

on 3 for respective hrs.

6.43 5.94 4.21 6.43 5.94 4.21 6.43 5.94 4.21

9. Net interest per lamp 5-6 1.40 9.16 46.13 -2.40 6.14 36.06 -3.41 3.12 25.99

10. Total saving per lamp 4-7 -69.40 455.16 2291.13-

119.40+24.00 1791.06

-169.41

155.12 1290.99

11. Saving break - even at 1278 hrs 1597 hrs 2129 hrs

12. Breakeven in item of days @6hrs/day 213 days 266 days 355 days


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3. Critical Evaluation

Havells 23W (FU) B22 Lilliput CFL is better than Surya Regular 100 W Bulb

From the above analysis, it is clear that the option available with the customer of purchasing

Havells 23W (FU) B22 Lilliput is much better than Suryas regular 100W Bulb. The study

mentioned above helps us to understand that even though the price of CFL is almost 15 times a

Regular bulb, consumer prefers to buy CFL

Since the overall benefit of using a CFL surpasses the drawbacks of Regular Bulb, we can

conclude that its always better to use an energy saving product rather than energy consuming

product.

The savings in terms of electricity bill and the durability of CFLs allows a consume to

contribute to the environment and also gain the advantage of using a green product.


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4. Bibliography

www.google.com

www.wikepedia.org

www.suryaroshnilighting.com

www.havells.com

www.pressreleasepoint.com

www.elcomaindia.com
http://www.google.com/http://www.google.com/http://www.wikepedia.org/http://www.wikepedia.org/http://www.suryaroshnilighting.com/http://www.suryaroshnilighting.com/http://www.havells.com/http://www.havells.com/http://www.pressreleasepoint.com/http://www.pressreleasepoint.com/http://www.elcomaindia.com/http://www.elcomaindia.com/http://www.elcomaindia.com/http://www.pressreleasepoint.com/http://www.havells.com/http://www.suryaroshnilighting.com/http://www.wikepedia.org/http://www.google.com/


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Annexure I

Interview Questions- Retailers

1. Which product is preferred between CFL and Incandescent bulbs?2. Which are the major companies selling these products?3. What are the factors that influence a buyer to purchase either of the products?4. Which factors, other than price are considered by the customers while buying the

products?

5. Is Energy saving function of lightings considered by the customer before making apurchase?

6. What are the benefits provided to the customers by an energy saving lighting?


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Annexure II

QuestionnaireCustomer

Name: ___________________________________

Age: ________________

City: ________________

Sex: Male Female

Family Income____________________

Questionnaire

1. Which product do you prefer out of a Regular Bulb and CFL?a. Regular Bulbb. CFL

2. How frequently do you change your lighting equipments like lamps?


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a. once in 6 monthsb. Once in a yearc. Once in 2 years

3. How many hours a day, do you use the lighting equipments?a. Less than 6 hoursb. 6 hoursc. 8 hoursd. 10 hours

4. What do you prefer out of the two options?a. Buy 6 bulbs in a year at a price of Rs.14b. Buy one CFL in a year at a price of Rs.240

5. Would you prefer buying CFL over regular Bulbs?a. Yesb. No

6. Do you prefer using energy saving products in future?a. Yesb. No

7. Out of these, which is the most important factor while purchasing a Car? (PleaseRank)

a. Price of the productb. Product Features and Durabilityc. Temporary Usaged. Cost Savings in Futuree. Overall service and support by the company


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Documents

CFL Economics