NCPA - National Center for Policy Analysis

Government-Subsidized Green Light Bulb Carries Costly Price Tag

March 12, 2012

The U.S. government last year announced a $10 million award, dubbed the "L Prize," for any manufacturer that could create a "green" but affordable light bulb.  Now the winning bulb is on the market, says the Washington Post.

  • The price is $50.
  • Retailers said the bulb, made by Philips, is likely to be too pricey to have broad appeal.
  • Similar LED bulbs are less than half the cost.

How the expensive bulb won a $10 million government prize meant to foster energy-efficient affordability is one of the curiosities that arise as the country undergoes a massive, mandated turnover from traditional incandescent lamps to more energy-efficient ones.

  • Energy legislation signed by President George W. Bush in 2007 introduced a ban on inefficient incandescent light bulbs, covering traditional 100-watt bulbs this year.
  • Sales of traditional 75-watt incandescents will be prohibited next year, and 60-watt incandescents will go after that.
  • When replacing a bulb, consumers must now go out and buy energy-efficient incandescent, compact fluorescent and LED bulbs.

The L Prize was meant to ease this transition by enticing manufacturers to create affordable bulbs to replace the most common type, the traditional 60-watt.

A Philips spokesman declined to talk in detail about the bulb or its price because the product has yet to be formally launched.  It is expected to hit stores within weeks and is available online.  But the spokesman said the L Prize bulb costs more because, as the contest required, it is even more energy-efficient, running on 10 watts instead of 12.5 watts.  It is also brighter, renders colors better and lasts longer.

Still, the contest set price goals.  According to the L Prize guidelines, manufacturers were "strong­ly encouraged to offer products at prices that prove cost-effective and attractive to buyers, and therefore more successful in the market."  The target retail price, including rebates from utilities, was to be $22 in the first year, $15 in the second year and $8 in the third year.

Source: Peter Whoriskey, "Government-Subsidized Green Light Bulb Carries Costly Price Tag," Washington Post, March 8, 2012.

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