The key to LED break is the government coordination

A home of 9-watt LED lights costs 200 yuan; a LED street lamp costs as much as tens of thousands of yuan. In the early days when the cost of the emerging LED lighting market was high, EMC (contract energy management) was once considered a “cutting tool” for market development. However, the reporter recently found that the "weapons" in the promotion of LED repeatedly failed, industrial development could not break.

â– The industry is optimistic about the international model

In 2011, the first year of the “Twelfth Five-Year Plan”, energy-saving emission reduction has become the highlight of the country, of which LED promotion is of great significance. "In the low-watt lighting, the same brightness of LED lamps can save up to 90% than traditional lighting," the industry said.

However, high prices have become a stumbling block to market promotion. Under such circumstances, the prevailing EMC model abroad is favored by the industry. "Simply put, the object of LED transformation does not need to pay, we can help you to change, in the future to pay us from the savings of electricity bills in time." Shenzhen LED Industry Federation, Yi Feng Lighting Chairman Feng Jun introduction, At present, more than 70% of domestic LED retrofit projects are municipal projects. They are large-scale and costly, and are most suitable for the EMC model.

"In theory, the EMC model can well solve the buyer's financial problems and it is more easily accepted by the buyer." Feng Xiaoxiang, executive director of China Lighting, said that in the market expansion, the EMC model once hoped to be high.

Usually, the EMC cooperation model is divided into two types: First, the annual electricity savings are divided into two parts by the energy-saving transformation, which is returned year after year, until the contractual agreement is completed, the contract execution cycle is longer, and the second is the annual electricity savings. The amount is returned to the LED company until the amount agreed in the contract. This model has a fast payback and is favored by LED companies.

â–  "Free Energy Saving" has encountered a bottleneck

However, the wonderfulness of the theory does not mean that the smoothness of the reality does not hinder.

“Where does the initial capital for the transformation come from? LED companies that want to eat big cakes often have headaches.” According to Feng Jun, according to the EMC rules, this money will be sent out by LED companies, but there are millions of inputs and short-term investments without any return. Fortunately, a sum of two strokes, if you start a few projects at the same time, the amount of days of mobile money, which companies can not eat too much.

You have no money, can you find a bank loan? There are LED companies are still helpless: "A lot of LED companies belong to the soon-to-be-created high-tech enterprises, most of them are in the initial period, and the transfer is not a new technology that is widely accepted by the market. It only has the future charging rights and cash flow, and the bank The emphasis is on land, factory buildings and other assets. This makes it difficult for LED energy-saving companies to make loans."

In developed countries, most of EMC's energy-saving investments originate from loans, and insurance companies have specialized insurance policies to help companies mitigate risks and prevent customers from defaulting on the arrears of sharing fees.

"The actual situation of the client is different, it will also restrict the promotion of EMC." LED business people with many years of EMC promotion experience, said there are often three situations: First, the user is too economical, like some domestic second-tier cities, street lamps are spaced illumination This means that the EMC model has a long period of return on investment; second, the electricity bill is inherently low, and the cycle is, of course, rewarded by savings in electricity bills. Third, some financially rich regions have little interest in large-scale LED lighting transformation. All of these causes "no money for energy savings" can only be "too good for shave."

â–  More difficult to implement municipal projects

At the beginning of the EMC cooperation, there were many obstacles, and after the cooperation was really unfolded, there was not a smooth sailing.

Currently in the domestic LED lighting field, more than 70% of the market is a municipal lighting project. Although the State Council has repeatedly proposed to promote the development of LED and other energy-saving emission reduction industries, but in the LED lighting transformation market dominated by grass-roots governments, EMC implementation is still struggling.

Various government departments treat the EMC model with subtle attitudes. As a matter of fact, the financial system of the current government department that “separates revenue from expenditures” is specific to any one department. The “export” of electricity expenses is in the financial sector.

For example, people in the industry say that a street lamp of a local municipal institution costs 1 million yuan each year, and it is reduced to 200,000 yuan after the introduction of LED street lamps. However, according to the financial system of “reporting real money”, the municipal department cannot save the energy savings of 800,000 yuan. Take it out and share it with LED street lighting companies. As a result, not only can LED street lighting companies fail to recover their investment, but these municipal units also have no incentive. It is understood that E-Tech has originally planned to use the EMC model to open up the municipal engineering market, but has finally given up because it cannot find the counterparty's fee payment unit.

In addition, due to the long implementation cycle of EMC projects, the changes in government agencies and personnel during the period have also brought uncertainties to the execution of contracts. In this context, banks are not afraid to lend lightly.

It is not easy to carry out EMC cooperation even with financially flexible corporate customers. Some customers, after the completion of the renovation, are free to arbitrarily pick up other electricity projects on the lighting line, resulting in insignificant or no power saving, and the return on investment is far behind.

â–  The key to break is the government coordination

"The implementation of EMC in the LED lighting market, the current domestic successful sample is not much." A number of LED executives said that the government how to coordinate the implementation of EMC projects is the key to the successful implementation of EMC. “As long as the government plays a leading role, LED lawn lamps, and the establishment of some credible platforms, further implementation of preferential policies on financing, taxation and other aspects of the EMC project of LED lights, multi-pronged support, the road to contract energy management It will go flatter."

The good news is that China's first large-scale EMC alliance initiated by the Guangdong Green Industry Investment Fund has already settled in Shenzhen. The alliance brings together many upstream and downstream companies in the LED industry chain, a number of financial institutions, testing organizations, engineering design and construction companies, tendering companies, law firms, and energy contract management service companies. "Shenzhen can do more in LED promotion." Feng Jun said that at present, LED indoor lighting technology is more mature than outdoor lighting. If Shenzhen can promote LED transformation in public buildings such as the Civic Center, it can be used by nearly 3,000 local upstream and downstream companies. Enterprises create more market opportunities.