Diversified products group Royal Philips Electronics has entered into a joint venture (JV) with demand-side management (DSM) initiatives company Karebo Systems and the State-owned Central Energy Fund (CEF) to establish a compact fluorescent lamp integrated (CFLi) light bulb manufacturing facility in Lesotho.
Philips holds a 40% stake, while Karebo and the CEF each hold a 30% interest in the JV. The cost involved in establishing the facility could not be disclosed at this stage.
Construction of the facility has already begun in the country’s capital, Maseru, and the first bulbs are expected to be released to South African and other African markets in September, Philips chairperson and CEO Ian Murdoch said on Thursday.
Philips GM Luc Escoute explained that it would take between six and 12 months to ramp up production to the fully operational output of some 15-million CFLi bulbs a year. The company previously manufactured the bulbs in China.
He noted that the facility was “economically viable” at this output, but added that if there was a higher demand for the bulbs, particularly in international markets, the facility would be able to scale up production even more to between 30-million and 50-million bulbs a year.
When asked about which portion of the bulbs would be sent to South Africa, Escoute was unsure at present, but said that this depended on Eskom’s accelerated DSM programme, and previously the split had been 80% of the bulbs coming to South Africa and the remainder to the other African countries. However, now more of a balance may emerge as countries such as Zambia, Botswana and Namibia had also pushed the roll-out of energy efficient lighting.
The venture would start with the assembly of the CFLi light bulbs, then the production of burners for the bulbs, and potentially production of the components, and would also include the establishment of a recycling plant in Lesotho.
Murdoch commented that the recycling plant was “still in embryonic stages”, adding that there was still work to be done with regard to government getting on board and creating policy, getting retailers involved in incentivising recycling, facilitating job creation and creating awareness among consumers.
Asked to why Lesotho was chosen as a location CEF group CEO Mputumi Damane said that what was important was that the facility “had been opened in Africa to serve the rest of the world”.
The facility was expected to create between 400 and 500 direct jobs and additional work in South Africa associated with the transport, shipping, packaging and components production.
It would also meet the growing demand for energy efficient lighting, particularly in South Africa in the context of the electricity constraints and government’s drive for residents and buildings across the country to replace incandescent bulbs and generally reduce their consumption.
Murdoch commented that, in the midst of the crisis in the country, replacing incandescent bulbs with new technology lighting on a large scale was found to be more effective, while less costly and time consuming than creating new generation capacity.
Philips said in a statement that lighting accounted for some19% of global electricity consumption and if all lighting was changed to energy efficient technology a potential saving of 40% would be achieved.
In South Africa, lighting contributes to between 15% and 17% of total electricity consumption – equal to 37 000 GWh. If the country aimed for a 40% energy conservation target by implementing energy efficient technologies, it could reduce electricity consumption by 14 800 GWh/y (equal to three midsize power stations), decrease carbon dioxide emissions by 13,3-million tons and save the economy R5,3-billion.