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Will California Energy Commission Ruling Save Energy, Stifle Innovation?

November 20th, 2009

On Wednesday November 18, the California Energy Commission (CEC) delivered their ruling regulating power consumption for televisions sold in California beginning in 2011. As an example, the CEC standards require that a 42-inch television consume 183 watts or less by 2011 and 115 watts or less by 2013, regardless of the display technology - LCD, Plasma, OLED, Projection, or other. The CEC justifies its regulation of televisions as a way to save energy and deliver cost savings to California consumers. The CEA and others opposed this legislation, but now that the CEC has issued its regulation and the debate has largely ended, it is time to assess the impacts and implications of the ruling and determine if much will change going forward.

As we completed Insight Media’s recently issued Green Display Report this month we reported that the US EPA’s Energy Star labeling program, set manufacturers and consumer interests are combining to drive the trend to greener as well as lower power consumption televisions. Set manufacturers have been and are continuing to deliver televisions that consume less power and offer energy saving features including ambient light and user presence sensors.

However, the independent actions of Energy Star and the CEC highlight the need for harmonization of the methods and goals for achieving reductions in energy consumption. In the end, the major distinction between the approaches to energy savings used by CEC and Energy Star are that the CEC regulates to a specification while Energy Star seeks widespread voluntary compliance to very similar power consumption levels in similar time periods.

As the lively debate prior to the adoption of the CEC ruling shows, the future holds the potential for more such battles in the US and globally over display specifications and regulations if harmonization of methods and goals is not pursued. These seemingly endless battles may eventually lead to a common truce but will likely be costly. In order to both minimize these costly efforts and drive toward a greener future, we prefer to call for industry action to address harmonization of the methods and goals for delivering greener displays to consumers.

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Looking at the specific impacts of the CEC ruling we see a number of questions. Will CEC regulation of televisions delay the introduction of new technologies and features? Or, will it spur efforts for faster introduction of energy saving technology? Will regulators be forced to revisit their rulings over time as new technologies are introduced, new features and product categories evolve, or still more stringent requirements are sought?

Popularly priced televisions of various technologies are already for sale that meet or exceed the 2011 CEC requirements. The introduction of new technologies such as LED backlights for LCD TVs are yielding sets with both higher display performance as well as lower power consumption. Set manufacturers are responding to customer demands for higher display performance while simultaneously delivering greener sets at competitive prices.

Perhaps a more serious challenge for the display industry and regulators is realizing lower energy consumption as televisions incorporate new features and develop different usage models. New features such as Internet connectivity, stored content, and 3D TV may come with added power consumption. Televisions and other display products in consumers homes are multiplying and being used in new ways, particularly for streaming content to the user and downloading and storing content for later use.

Increasingly, it will be important for display systems to incorporate smart power management to deliver the features consumers desire while minimizing energy consumption. Display manufacturers, specification setters and regulators have both the need and opportunity to establish mechanisms to monitor and set goals for display power consumption. Accomplishing these objectives effectively and economically will require the harmonization of methods and goals.

Some progress has been made toward this harmonization, but a good deal of concerted effort will be required over at least the next several years to reach a satisfactory conclusion. While we are concerned that regionally fragmented regulations will increase costs and limit display innovation in the coming years, we see opportunities for cooperation. But, the display industry will need to be proactive in delivering green products with reduced energy consumption or risk further fractious and increasingly divisive regulation.

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