China’s National Development and Reform Commission (NDRC) recently announced it will be strongly promoting energy efficiency and carbon emission reduction policies in 2014, according to a Chinese-language Huagu.com report. The implementation of the country’s “2014-2015 Carbon Reduction Plan” is expected to spur LED market development in China. The policy will be focusing on the certification of energy consumption and developing technologies in energy efficiency, environmental protection, and recyling resources.

The organization projected a grim outlook for China’s carbon emission reduction situation in the next few years. LED will be the first industry highlighted by the organization in its promotion of carbon emission reduction activities. The organization estimated global LED lighting will increase 90 percent in 2014. China is currently the major global LED manufacturing base.

NDRC latest statistics showed China’s total energy consumption in 2013 was down 3.7 percent, meeting the country’s annual target. Other gas emissions including Chemical Oxygen Demand (COD), sulfur dioxide, ammonia nitrogen and nitrogen oxide also met annnual targets.

However, a mid-term evaluation by China’s 12th Five Year Plan revealed China’s total energy consumption, GDP to carbon dioxide emissions, and nitrogen oxide emissions have lagged behind after reaching annual targets. The country will be facing serious challenges in its carbon dioxide emission reduction efforts.

On the flip side, the difficult situation will create large room for growth for Energy Services Company (ESCO). China’s ESCO industry market value will reach RMB 300 billion (US$ 9.90 billion) and have up to 2,000 companies by 2015, recently said Zhou Chun, the energy service industry committee member minister, China Energy Conservation Association (CECA). From industry insider’s perspective, it is certain that the LED industry will undergo growth.

The LED industry market penetration rate is in the golden age of rapid growth in these three years. The residential lighting market has opened up due to continual LED cost falls, and initiation of different market applications, 2013 to 2015 penetration rates have rapidly increased. It is expected, the global LED lighting market will increase 90 percent in 2014, and market penetration rate will reach 20 percent. Due to LED lighting’s short manufacturing period and relatively easy technology acquisition, China’s LED lighting has achieved cost advantages in different applications and will become a major production LED lighting base. China’s LED indoor lighting market grew 86 percent in 2013, and is expected to grow in 2014 and 2015 at 65 percent and 43 percent respectively.