The emphasis on energy saving in China has become a new growth engine for lighting giant Philips, according to a top executive from the company.

Theo van Deursen, executive vice-president of the Dutch giant and CEO of its lighting business, said in an interview in Beijing that energy saving has been regarded by China as a major task and his company would hope to contribute to the process.

China has listed energy efficiency as a key priority in its national economic and social development and aimed to cut energy consumption per unit of gross domestic production by 20 per cent in 2010 from the end of 2005, according to its 11th Five-Year Plan for 2006-10.

"It is good that China gave a high emphasis on energy efficiency and lighting can be a good starting point in this campaign," said van Deursen.

Although many people believe lighting and lamps consume only a small amount of energy, 19 per cent of the world's energy consumption is from lighting; in China it is 13 per cent.

Another factor that has slowed the adoption of energy-saving lighting in China is high initial costs.

Most energy-saving bulbs cost about US$2.5, while ordinary bulbs cost just 40 US cents.

However, van Deursen urged consumers to note the long-term cost, as energy-saving light bulbs consume less electricity and have a much longer life.

He estimated that if all lights in the European Union were replaced by energy-saving ones, it would save 4.3 billion euros (US$5.55 billion) a year.

In the Netherlands, 80 per cent of commercial buildings and 20 per cent of households use energy-saving lighting.

There is no exact figure for the penetration of energy-saving lighting in China, where 80 per cent of the world's energy-saving lights are produced, but Philips claims that 40 per cent of its products sold in China are in that category.

The Dutch giant has spent 1 billion euros (US$1.28 billion) on the development of energy-saving lighting and 1 billion euros to promote compact fluorescent lights (CFLs) in the world, according to van Deursen.

It already introduced 90 per cent of its energy-saving products into China and makes 80 per cent of its CFL lights in China. Philips produced 160 million such lampslast year.

Van Deursen also revealed that in two years his business would procure 600 million euros (US$768 million) in China, a key link in Philips' supply chain.

"Our strategy is fully focused on energy-saving lighting in our business," said van Deursen.

The electronics giant has already won tenders to provide lighting solutions to several stadiums for the 2008 Olympic Games in Beijing on the back of its energy-saving solutions.

He predicted Philips' lighting business in China will maintain a growth of 15 per cent a year for the next few years.