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1. Project Summary and Relationship to China's Agenda 21

The purpose of the China Green Lights Programme is to develop China's high-potential market for energy-efficient lighting, thereby promoting energy conservation and mitigating environmental pollution. This will involve establishing a management and implementation system to popularise advanced lighting products and promote the commercialisation of energy efficiency services.

This project is based on programme areas 13B and 4C of China's Agenda 21, and is related to programme area 12C.

2. Background

Per capita electricity generation in China is currently only 750 KWh, ranking 89th in the world. Even though Chinaís power industry has developed rapidly in recent years, supply is far from meeting demand, especially during peak load times. China has a large potential for saving electricity because of its low energy efficiency and serious waste of electricity. Paying more attention to electricity conservation will therefore be a long term strategic priority. Electricity use for lighting accounts for 10-13 percent of total electricity consumption in China. The use of electricity for lighting has risen rapidly in recent years, with an increase of 15 % since 1990. The proportion of electricity used for lighting will increase to 14-19 % by 2000.

Green Lighting refers to the development and popularisation of high efficiency lighting, with a concurrent drive to save and regulate electricity used for lighting. Implementation of China's Green Lights Program will establish high-efficiency and comfortable lighting systems while greatly reducing generation capacity requirements during peak load periods so as to reduce necessary investment in new production capacity and mitigate the environmental pollution caused by coal combustion. Green Lighting has been advocated by the United Nations as a significant step toward electricity conservation and environmental protection. The Green Lights Development Program has been set up in the USA, Japan, France, UK and other developed countries in Europe. The Program has been implemented in some developing countries in the Asia-Pacific region. Chinaís implementation of the Green Lights Program is of global significance, as China represents a potentially enormous efficient lighting product market.

The guiding principle in the National Ninth Five-Year Plan for Economy and Social Development and the Long-term Targets for the Year 2010 restates: Emphasis resource conservation and comprehensive utilisation, vigorously improve resource utilisation efficiency and carry out a comprehensive conservation strategy. In 1994, the State Economic and Trade Commission (SETC) organised and initiated the China Green Lights Program (CGLP), aimed at saving electricity and protecting the environment. The CGLP has become the key national energy conservation project in the Ninth Five-Year Plan. SETC, as the lead ministry, has organised and established a Leading Group, a Program Office and an Expert Group to co-ordinate and organise relevant government agencies, such as the State Planning Commission, the State Science and Technology Commission, Ministry of Electric Power, Ministry of Electronics Industry, Ministry of Construction, Ministry of Agriculture, China National Council of Light Industry and research and management institutions to work together on the program.

Since the 1980s, SETC has successfully organised a series of projects beneficial to electricity conservation, such as importing foreign equipment and technologies, supporting manufacturers of energy efficient products, and popularising efficient lighting product use among key users. In 1993, the SETC organised the Expert Group of the CGLP to investigate the current situation of Chinaís efficient lighting manufacturers and market and to analyse the major barriers to success. It has also developed pilot projects on efficient lighting in some cities. These activities confirmed both the feasibility and the necessity of implementing the CGLP.

3. Objectives

3.1 Long-term Objective

Through the implementation of the CGLP, to establish a nation-wide system for the large scale production, popularisation and marketing of Chinese Green Lighting products, including efficient lamps, fixtures and sensors. This will realise electricity savings and environmental protection, and will improve the quality of life for residents of both urban and rural areas.

3.2 Immediate Objectives

• To establish a mechanism and system to promote the CGLP, thereby attracting manufacturers and consumers to participate in the CGLP, and standardise the lighting product market;
• To import and develop advanced equipment and technologies, expand production scale and realise the goal of saving 30 billion KWh of lighting electricity by the year 2000;
• To set up several lighting demonstration projects.

4. Outputs and Activities

4.1 Strengthening the CGLP

• Disseminate CGLP information through the media;
• Establish China Green Lights Program product display sites;
• Organise training and observation tours abroad for engineers and managers.

Monitoring Indicators: 3 pilot projects in Beijing, Shanghai and Guangdong; 400 engineers and managers trained on Green Lights policies and measures, product certification, quality standards, design and implementation of pilot projects, etc.

Implementing Agency: China Green Lights Program Office (CGLPO)

Time Schedule: January 1997 - December 1999

4.2 Product Popularisation and Market Service System

• Set up the China Green Lights Program Product Certification Centre, formulate certification norms;
• Establish production and design standards and codes for the CGLP;
• Introduce a new mechanism for energy management, such as ESCo. (Energy Service Company).

Monitoring Indicators: standards and establishment of ESCos.

Implementing Agency: CGLPO

Time Schedule: January 1997 - December 1999

4.3 Import Foreign Advanced Technologies and Develop the Chinese Efficient Lighting Industry

• Import large scale T8 fluorescent technologies to expand and improve the existing production scale. The technical level of equipment must reach international standards by the turn of the century. Annual T8 output will reach 20 million units after factory retrofitting;
• Import key technologies and equipment for compact fluorescent lamps (CFLs) to improve product quality. CFL production will reach 20 million units per annum;
• Import efficient electronic ballast technologies to improve domestic manufacturers' technical levels. Annual production of electronic ballast will reach 10 million units for CFLs and 5 million for fluorescent tubes.

Monitoring Indicators: standards of equipment and products, an annual production capacity of 300 million units by the year 2000.

Implementing Agencies: CGLPO and relevant enterprises.

Time Schedule: January 1997 - December 1999

4.4 Pilot Projects

• Modern city lighting pilot project in Shanghai;
• Technology importation, development and dissemination pilot project in Guangdong;
• Large scale lighting system retrofit pilot project in Beijing;
• Efficient lighting design pilot project for new buildings.

Monitoring Indicators: completion of lighting system demonstration projects

Implementing Agencies: CGLPO and relevant enterprises.

Time Schedule: January 1997 - December 1999

5. Inputs

5.1 Chinese Inputs

This investment will be used to support project operations, including travel expenses in China, copying and printing expenses, communications and labour expenses for project staff and secretarial support, office rent, equipment, etc. The costs of project design, importing technologies and equipment, and establishment of a popularisation system will also be included in domestic inputs.

5.2 International Inputs

International inputs will be used for display sites, overseas training and study tours and formulation of relevant standards and codes. Meanwhile, US$ 13 million loan will be applied for from international banks to import foreign advanced technologies.

5.3 Budget

The total capital needed for this project is US$ 42.50 million. The Chinese side will raise US$ 21.00 million from domestic sources, while foreign aid will cover the other US$ 21.50 million.

Table 1. Budget by Item (in million US dollars)

Table 2. Budget by Output (in million US dollars)

6. Benefits

As a result of implementing the project, a great quantity of electricity will be saved, thereby reducing fossil fuel combustion and mitigating SO2 and CO2 pollution. According to expert estimates, electricity use for lighting will be reduced by 20 percent nation-wide by 2000, corresponding to a saving of 30 billion KWh. Assuming the pollution factor is kept at the 1990ís level, SO2 emissions would be reduced by 0.2 million tons per year and CO2 by about 7.4 million tons per year. The potential social benefit is impressive; the quality of life would be improved in respect of lighting, health and in the environment. Electricity use for lighting ranks second only to that of electric motors among all end uses of electrical equipment. Based on a comparative life-time cost analysis of end-use electrical equipment, lighting electricity conservation offers the highest efficiency and the most attractive cost-benefit returns. Therefore, implementation of the project will bring obvious economic benefits and will spur the development of the Chinese lighting appliance industry.

7. Risks

The key factors which may influence project implementation are the coordination of relevant governmental agencies and the reliability of financing. Up to now, the SETC has coordinated successfully with other governmental agencies; the remaining critical factor is whether the various funds will be obtained in a timely manner. High rate of future discounting by domestic consumers is also a major problem while purchase price of CFLs is significant higher than standard bulbs.

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