Dennise Williams, Staff reporter
Minister of Industry, Technology, Energy and Commerce, Phillip Paulwell, views the Energy Conservation Exhibition at the Petroleum Corporation of Jamaica office at Trafalgar Road in October last year. - JUNIOR DOWIE /STAFF PHOTOGRAPHER
AS PART of a project which it hopes will encourage energy efficiency and help to trim the country's fat oil bill, the Government is distributing, free of cost, four million energy-saving fluorescent bulbs to Jamaican households - a gift with an estimated retail value of $2 billion and the ability to place a big dent in the commercial market for the product.
Retail sector bosses yesterday said that some firms could feel a heavy pinch from the Government's action for several years, but conceded that there could be a positive side to it for an energy-deficient economy such as Jamaica's.
"It is devastating for some businesses, because there are people who do (sell) nothing but energy-saving bulbs," said Abdula Marzouca, owner of Marzouca Lighting, one of the island's largest retailers of lighting fixtures.
But, added Marzouca: "There is a bigger picture - It should have an impact on energy savings."
Government sources say that Phillip Paulwell, the commerce and energy minister has delayed formal announcement of the programme until he has a second round of talks with the Jamaica Chamber of Commerce (JCC), hoping to assuage the private sector which has expressed concern over the administration's approach to the project. Some officials have complained that the scheme, while perhaps good, has not been clearly thought through and appears not to have taken full account of those firms which now sell fluorescent bulbs and may have significant inventories.
BIG PLAYERS
"To tell you the truth, we don't have a lot of information on the subject," said John Mahfood, the head of retail operations of the GraceKennedy group, whose HiLo supermarkets and Rapid TruValue hardware stores are among the big players in the still nascent market for fluorescent bulbs, which they helped to spawn.
"There has been no discussion with companies like ours which may have inventories or shipments on the way," Mahfood said. "If the Government is going to do something like this they should have given attention to the private sector and ways that it might be involved."
The Government, having piloted the project in Paulwell's East Kingston constituency, however, believes it has a workable model for the give-away. An estimated 32,000 fluorescent bulbs were exchanged on a one-for-one basis with incandescent light bulbs in 6000 homes.
The exchanges were done by Cuban technicians, whose government is making a gift of the Phillips brand fluorescent bulbs, apparently as part of the Venezuela-led PetroCaribe initiatives, Financial Gleaner sources say.
The administration estimates that the bulbs will be distributed to 400,000 households, starting in East Rural and South West St Andrew and that at full take-up, the use fluorescent bulbs could save between 80 and 100 megawatts of power during the peak evening demand period.
Electricity consumers will likely see some saving on their energy bills which should be an incentive to the increased use of fluorescent bulbs, government officials say, but private sector leaders suggest that the most obvious impact will be on the oil bill of the domestic light and power company, Jamaica Public Service (JPS).
"The issue is whether they will pass on savings," Marzouca said.
Jamaica had a US$1.33 billion oil import bill last year, up 41 per cent from the year before as international energy prices spiralled.
For retailers though, the issue is the longevity of fluorescent bulbs and the possibility of being frozen out of the market for a long time. For instance, good quality energy-saving fluorescent bulbs, which retail for about J$500, have a life of between 8,000 and 10,000 hours, double or more the lifespan of incandescent ones.
On that basis, retailers say, the average householder who will perhaps receive between six and 10 bulbs may not be in the market for the product for a long while.
Marzouca, the bulk of whose business is in fixtures - bulbs account for under 10 per cent - is considering developing marketing schemes of matching energy-saving fluorescent bulbs with the fixtures he offers for sale. "We are developing ideas," he said.
However, Marzouca and others, hope that after the initial difficulties there will develop a strong market for the energy-saving bulbs, which have had a slow take-off because of some price resistance in the market.
"I don't sell a whole lot of these bulbs, but there is still going to be a pinch," said Noel Chang, co-owner and general manager of ABC Electrical, a Kingston electrical supplier. "But I hope that this will be good advertising and in the long-run we will benefit."
