Blog author: jballor
Tuesday, January 2, 2007
By

“The environment is begging for the Wal-Mart business model,” says H. Lee Scott Jr., CEO of Wal-Mart Stores in a NYT article, “Power-Sipping Bulbs Get Backing From Wal-Mart.”

The piece discusses Wal-Mart’s campaign to increase the sales of compact fluorescent bulbs, as compared to traditional incandescent bulbs. As Michael Barbaro writes, “A compact fluorescent has clear advantages over the widely used incandescent light — it uses 75 percent less electricity, lasts 10 times longer, produces 450 pounds fewer greenhouse gases from power plants and saves consumers $30 over the life of each bulb. But it is eight times as expensive as a traditional bulb, gives off a harsher light and has a peculiar appearance.”

I’ve converted probably half of the bulbs in my home to CFLs (compact fluorescent lights), but have run into problems when trying to use them in some places. Lights that use dimmer switches, for instance, don’t work well with CFLs. And some CFLs won’t fit into light fixtures designed to accommodate incandescent bulbs.

Wal-Mart’s clout has begun to affect the light bulb manufacturing business, as producers like GE struggle to change their emphasis from production of incandescents to CFLs.

And on the demand side, what’s called for in convincing consumers to go with the CFLs is a basic economic lesson: you are sometimes better off spending more in the short-term for long-term gain: “Wal-Mart will have to persuade its traditional consumers that it is worth paying a bit more at the checkout counter to save a significant amount money down the line, a seemingly simple task that few companies ever accomplish. It is particularly difficult at a retailer that has long emphasized ‘always low prices.’”

As is so often the case, the best economic decision is the one that makes best use of both financial and environmental resources.

Update: This story is getting major attention across the blogosphere and MSM, including a NYT editorial here, and posts here and here.


  • http://evaneco.com Don Bosch

    Pop quiz:
    Q – How long will it take for pro-environment and pro-labor forces to collide over Wal-Mart’s efforts to flood the market with cheap, green products?
    A – Bush LIED!

    We got used to CFs while living in Japan. Been buying our CFs at Wal-Mart since we returned, saving a bunch on electricity (we noticed a $40 dollar drop in our California electric bill the first month). Theirs are far-and-away the cheapest on the market. The only thing cheaper is when you can get them for free from your local utility (bulb swap promotions, etc).

    “better off spending more in the short-term for long-term gain”? GE’s problem with that is bigger than your average consumer, I think. It’s is akin to the Big Three’s failure to follow the lead of Honda and Toyota on hybrid cars. Re-tooling is more expensive than the short-term payoff, and it is up to GE to convince its stockholders of the same thing it’s trying to convince consumers.

    GE might get on the CF bandwagon when Wal-Mart starts buying/selling CFs made by Sylvania. But then again, US automakers are still 10 years behind Honda/Toyota, and counting…