2.2 billion subsidies to promote the butterfly effect caused by LED lighting

On May 16, 2012, Premier Wen Jiabao of the State Council presided over the State Council executive meeting to discuss and adopt the "12th Five-Year Plan for the National Basic Public Service System" to study and determine the policy measures to promote the consumption of energy-efficient home appliances. The meeting decided to arrange a financial subsidy of 2.2 billion yuan to support the promotion of energy-saving lamps and LED lights. The 2.2 billion yuan subsidy may not be able to take into account all LED products, and even less than the annual income of a large enterprise, but the reasonable benefit of 2.2 billion can promote the popularity of LED lighting.

The subsidy of 2.2 billion yuan will promote the promotion and utilization of LED lamps in the lighting industry, and will also incite the LED residential lighting market in the long run. With the rise of the global energy crisis and the global wave of environmental protection, protecting the environment and conserving energy have become the consensus of all mankind. With the popularization of “green lighting”, it is imperative to popularize LED lighting in the whole industry, so as to truly protect the environment and save energy.

According to the roadmap for the elimination of incandescent lamps issued by the relevant departments last year, from October 1 this year, China will ban the sale and import of incandescent lamps for general lighting of 100 watts and above. As this time approached, LEDs also began to occupy the public lighting sector and step into home lighting.

Now 2.2 billion lighting subsidies are about to land, and vigorously promote the popularity of LED. The author believes that the lighting subsidy of 2.2 billion yuan will mainly promote the popularization of LED lighting from the following three aspects.

Promote the development of LED enterprises
Lighting subsidies can directly benefit LED companies, so that they can have more funds to develop, while stimulating other companies to receive subsidies, and promote the development of LED enterprises as a whole.

Li Xuliang, chairman of Qinshang Optoelectronics, said that the large-scale high-quality enterprises in the industry are concentrated in Guangdong Province. The lighting subsidy program will help to cultivate leading enterprises in Guangdong, so that they can gain first-mover advantage and gain the right to speak in the industry competition.

Li Xuliang believes that because this subsidy will implement energy efficiency standards, only the relevant energy efficiency standards stipulated by the state can qualify for subsidies, and the implementation of the energy efficiency “leaders” system makes the industry's high-quality large enterprises occupy a dominant position. This is not only beneficial to China's LED lighting companies, but also conducive to the future development of LED companies.

At the same time, lighting subsidies allow LED companies to have more opportunities to develop new technologies, improve product efficiency and quality, thereby promoting the development of LED enterprise product technology and enhancing the competitiveness of LED companies in the domestic and international markets.

Promote the decline in the price of LED lamps
Lighting subsidies have not yet landed, and the price of LED lamps has begun to decline. Now the decline of LED lamps has exceeded the expectation of 15%-20% price reduction, and with the subsidy, the price of LED lamps is expected to continue to decline, realizing the "closer price."

The soaring price of rare earths has caused the price of phosphors, the main raw material of energy-saving lamps, to rise more than 10 times, and the cost of energy-saving lamps has also risen. However, its competitor LED lamps have continued to fall due to the price cut of upstream chips. I learned from a number of lighting companies that in the past year, LED chips have fallen from 6 yuan to 2 yuan, driving LED lights down by 30%, and the average price has dropped to 30-100 yuan.

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