Accelerating India’s Low-cost Net-zero Transition: The Role of Smart Climate and Innovation Policy

Saswata Chaudhury and Vidhu Kapur have been working as part of the Economics of Energy Innovation and System Transition (EEIST) consortium, which is dedicated to developing tools to support government decision making around low-carbon innovation and to accelerate technological change towards a net-zero energy system. In this op-ed, Saswata and Vidhu detail how fostering synergies between actors and timely policy interventions helped to grow the LED industry in India and dramatically improve energy efficiency.

- Saswata Chaudhury

Energy efficiency is a key element in the low carbon transition in India. The mainstream adoption and use of energy-efficient appliances is necessary for effective demand management— and that, in turn, can help India to meet its carbon reduction target. Growing populations, increasing urbanization and 100 per cent electrification are expected to increase residential lighting demand significantly in the coming decades. As per a recent TERI estimate, the share of lighting demand from the total residential electricity demand in India is approximately 20–27 per cent, but, this share varies across regions and income groups, and is as high as 60 per cent for poor households.

India has a mixed basket of lighting technologies, including incandescent bulbs (ICB), compact fluorescent lamps (CFL), fluorescent tube lights (FTL), and light-emitting diodes (LEDs). Among these technologies, LEDs are the most energy-efficient, consuming just 10 per cent of the energy required by an ICB, for a similar level of light output. In 2005, ICB and FTL together held around 95 per cent of the Indian market. However, due to various government initiatives, the market has undergone significant changes in the last decade or so, with LED holding a major market share. Survey findings by Agrawal revealed that by 2019, about 90 per cent of electrified households met their lighting demand using LED bulbs, of which 63 per cent used only LEDs. This article explores the role of government and price management initiatives in the promotion of new technologies.

Accelerated Transition to LEDs in India