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The ELI Story:TRANSFORMING MARKETS

FOR EFFICIENT LIGHTING

IFC/GEF EFFICIENT LIGHTING INITIATIVE (ELI)

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Contents

Part 1 3

Part 2 46

Part 3 10

Part 4 12

Part 5 14

What is ELI?

Efficient Lighting: A Bright IdeaELIs Toolbox for Transforming Markets

Innovation and Impact

The ELI Legacy

Acknowledgments

ABOUT IFC: The mission of IFC ( is to promote sustainable private sector investment in developing countries, helping to reducepoverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial

markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments andbusinesses. From its founding in 1956 through FY04, IFC has committed more than $44 billion of its own funds and has arranged $23 billion insyndications and underwriting for 3,143 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY04 was $17.9 billionfor its own account and $5.5 billion held for participants in loan syndications.

www.ifc.org)

The ELI Story:

EFFICIENT LIGHTING

TRANSFORMING MARKETS

FOR

IFC/GEF EFFICIENT LIGHTING INITIATIVE

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The goal was to reduce greenhouse gas emissions, one light bulb at a time, by

catalyzing vibrant markets for energy-efficient lighting across four continents and

in seven countries. The mplemented by IFC

between 1999 and 2003, and seeded by a $15 million* investment from the Global

Environment Facility (GEF), was a dynamic market experiment that engaged

multiple actors to promote efficient lighting in Argentina, the Czech Republic,

Hungary, Latvia, Peru, the Philippines, and South Africa.

Efficient Lighting Initiative (ELI), i

3

What is ELI?

Tailored to local conditions in each country,ELI achieved impressive results over itsthree-year life:

In Peru, annual sales of compact

fluorescent bulbs (CFLs) increasedtwentyfold, from 250,000 to over 5million;In Argentina, the price of CFLs droppedeightfold due to ELI-inspired promotionand competition between lightingmanufacturers;In the Philippines, manufacturersimproved the quality of their efficient

lighting products to meet ELIspecifications;Electric utilities in Argentina, Peru, thePhilippines, and South Africa beganselling, and financing, efficient lamps totheir customers;Municipal authorities in the CzechRepublic, Latvia, Peru, and South Africacommenced energy-efficient streetlighting upgrades;

Thousands of newly trained lightingprofessionals in seven countries will beable to specify efficient lighting for theirclients.

Across the board, ELI demonstratedsubstantial market impact with product pricesfalling (from $23 to $3 in Argentina), salesclimbing (by a factor of 21 in Peru), and salesof traditional incandescent lamps tumbling (by9 percent in South Africa, in a marketundergoing widespread electrification).

From ELI's outset, IFC commissioned an

independent Monitoring and Evaluation (M&E)assessment with a focus on sustained, post-program market impacts. While this long termstudy is not yet complete, aggregatedpreliminary results show that, across sevencountries, ELI reduced energy consumption by2,590 gigawatt-hours (GWH), and CO

emissions by 2,018,000 tonnes between 2000-2003. These initial estimates indicate that ELI

2

1

catalyzed immediate uptake of efficientlighting, even as the program strategy focused

on underpinning long term, sustained marketgrowth.

The ELI experience highlights IFC's role as amarket leader able to coordinate the sharedinterests of multiple entities and channelresources in a manner that truly movesandeven transformsmarkets.

*Note: All currencies are in US Dollars unless specified otherwise.

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7

Consumer Education and Marketing

ELI invested $3.7 million promotingefficient lighting across its sevencountries. Advertising campaignswere customized to meet marketneeds. For example, in the

Philippines, ELI engaged a national celebrity to

promote quality to combat the flourishing blackmarket of illegally-imported, bad quality CFLs. ELI'saward-winning campaign in the Czech Republicpromoted energy savings, comparing a greedy,energy-guzzling incandescent bulb to a slim,energy-efficient lamp. In South Africa, promotionswere conducted in partnership with the NelsonMandela Childrens Fund. In Latvia, ELI sponsoredcommunity promotions with municipalities andmanufacturers to introduce a 'new' technology toconsumers who knew little or nothing about efficientlighting prior to the program. ELI also worked withhypermarkets, lighting, and hardware stores tostock the shelves with ELI-qualified lightingproducts, further enticing customers with in-storepromotions. These tailored campaigns increasedpurchases of efficient lighting in all ELI countries(see Spotlight on Peru).

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In the Philippines, ELI built coalitions of regulators,lighting manufacturers and electric utilities to buildconsensus for efficient lighting as a strategy tomanage electricity demand and expand provisionof modern electricity services across thearchipelago nation.

Leveraging IFC's honest brokerrole, ELI convened over 70 organizations topromote efficient lightingfrom government

agencies and power producers, toenvironmentalists and consumer groups. Efficientlighting emerged as the primary choice for utilitiesto manage electricity use due to its direct impacton reducing demand in the residential,commercial, and street lighting sectors.

Once the new regulatory framework isfully implemented, potential energy savings in the

Philippines could amount to 62 terrawatt hours(TWh) per year by 2016, with 12 GWh hoursshaved off peak demand. This amounts toapproximately 24,000,000 tonnes of CO2 peryear, with an aggregated market value of $120million at the current average price of $5 pertonne. Manila Electric (MERALCO), one of thePhilippines largest utilities, has already committedto developing a Smartlight CFL program that willcover three million residential customers inMetropolitan Manila.

Innovation:

Impact:

Spotlight on

the Philippines:

ELI Powers

Regulatory Change

ELI Energizes National Regulations,

Standards, and Institutions for Efficient

Lighting

ELI was positioned to make a big impact on thelighting market as convener and provider oftechnical information to government regulators,standards agencies, and independentorganizations. ELI worked across the sevencountries to strengthen existing institutions to

promote efficient lightingin some instancescreating new organizations. One of these, theNational Council for Energy-Efficient Lighting inthe Philippines, a high-profile private-publicpartnership, continues to support marketdevelopment today. In Peru, Argentina, and thePhilippines, ELI promoted regulatory change thatenabled utilities to diversify their business whileimproving their management of system demand

(see Spotlight on the Philippines).

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Copyright (c) 2005International Finance Corporation2121 Pennsylvania Avenue, N.W.

Washington, D.C. 20433, USAwww.ifc.org

For more information, contact:

Russell Sturm

Li Tienan

ELI Global Program ManagerInternational Finance Corporation

Email rsturm@ifc.org

ELI Quality Certification InstituteChina Standard Certification Center

Email litn@cecp.org.cn

www.ifc.org

www.efficientlighting.net

Environmentally friendly printing on recycled paper using vegetable-based ink

The material in this publication is copyrighted. Requests for permission to reproduce portions of it should be sentto the Manager, Corporate Relations, IFC, at the address shown in the copyright notice above. IFC encouragesdissemination of its work and will normally give permission promptly and, when the reproduction is fornoncommercial purposes, without asking a fee. Permission to copy portions for classroom use is granted throughthe Copyright Clearance Center, Inc., Suite 910, 222 Rosewood Drive, Danvers, Massachusetts 01923, USA

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2121 Pennsylvania Avenue, N.W.

Washington, DC 20433, USATelephone 202-473-3800Fax 202-974-4384www.ifc.org