1

CHAPTER - 1
INTRODUCTION
1.1 Background of Air Conditioner

An air conditioner (often referred to as AC) is a home appliance, system, or mechanism designed to dehumidify and extract heat from an area. The cooling is done using a simple refrigeration cycle. In construction, a complete system of heating, ventilation and air conditioning is referred to as "HVAC". Its purpose, in a building or an automobile, is to provide comfort during either hot or cold weather. Benjamin Franklin and John Hadley (1758) conducted an experiment to explore the principle of evaporation as a means to rapidly cool an object. Franklin and Hadley confirmed that evaporation of highly volatile liquids such as alcohol and ether could be used to drive down the temperature of an object past the freezing point of water. They conducted their experiment with the bulb of a mercury thermometer as their object and with a bellows used to "quicken" the evaporation; they lowered the temperature of the thermometer bulb to 7 F (14 C) while the ambient temperature was 65 F (18 C). Franklin noted that soon after they passed the freezing point of water (32 F) a thin film of ice formed on the surface of the thermometer's bulb and that the ice mass was about a quarter inch thick when they stopped the experiment upon reaching 7 F (14 C). Franklin concluded, "From this experiment, one may see the possibility of freezing a man to death on a warm summer's day". Michael Faraday (1820) discovered that compressing and liquefying ammonia could chill air when the liquefied ammonia was allowed to evaporate. John 1842 used compressor technology to create ice, which he used to cool air for his patients in his hospital in Apalachicola, Florida. He hoped eventually to use his ice-making machine to regulate the temperature of buildings. He even envisioned centralized air conditioning that could cool entire cities. Though his prototype leaked and performed irregularly, Gorrie was granted a patent in 1851 for his ice-making machine. His hopes for its success vanished soon afterward when his chief financial backer died; Gorrie did not get the money he needed to develop the machine. Vivian M. Sherlock 1855 blamed the "Ice King", Frederic Tudor, for his failure, suspecting that Tudor had launched a smear campaign against his invention. Dr. Gorrie died impoverished in 1855 and the idea of air conditioning faded away for 50 years.

Willis Carrier (1902) designed to improve manufacturing process control in a printing plant, his invention controlled not only temperature but also humidity. The low heat and humidity were to help maintain consistent paper dimensions and ink alignment. Later Carrier's technology was applied to increase productivity in the workplace, and The Carrier Air Conditioning Company of America was formed to meet rising demand. Over time air conditioning came to be used to improve comfort in homes and automobiles. Residential sales expanded dramatically in the 1950s. Stuart W. Cramer (1906) was exploring ways to add moisture to the air in his textile mill. Cramer coined the term "air conditioning", using it in a patent claim he filed that year as an analogue to "water conditioning", then a well-known process for making textiles easier to process. He combined moisture with ventilation to "condition" and changes the air in the factories, controlling the humidity so necessary in textile plants. Willis Carrier adopted the term and incorporated it into the name of his company. This evaporation of water in air, to provide a cooling effect, is now known as evaporative cooling. The increase in use of air conditioning over the years has been implicated as a contributor to increasing obesity, because appetite naturally decreases in uncomfortably high temperatures.

1.2

Home Air Conditioning around the World

Domestic air conditioning is most prevalent and ubiquitous in developed Asian and Middle Eastern nations and territories. This especially applies to capitals and urbanized areas where most of the population lives in small high-rise flats. In these areas, with high summer temperatures and a somewhat high standard of living, air conditioning is considered a necessity and not a luxury. Japanese-made domestic air conditioners are usually window or split types, the latter being more modern and expensive. In Israel, virtually all residential systems are split types. In the United States of America, home air conditioning is most prevalent in the South/Southwest and on the East Coast. Central air systems are most common in the United States of America, and are virtually standard most of times in all new dwellings in most states. In Canada, home air conditioning is less common than in East Asia and the United States, but it still quite prevalent. This is especially true of the Great Lakes regions of southern Ontario and Quebec, where there are especially high humidity levels. While window and split units are common in these regions, central air systems are the most widespread in Western Canada. Few Western Canadian homes are built with already-compatible central forced air natural gas heating systems, making installing a central air system very simple. The majority of modern urban high-

rise condominiums built in Canadian cities have air conditioning systems. It is also offered as a relatively low-cost option on most new built homes. While energy is comparatively very cheap in Canada, the large size of the average Canadian home and cold winters make heating and cooling one of the largest household expenses. Canadian summers are uncomfortably hot, but rarely reach the dangerous temperatures experienced in the United States or Asia. As such, many Canadians, especially in older homes, simply choose to forgo air conditioning in lieu of simple fans and evaporative coolers. Aside from the cost, air conditioning is often considered environmentally unfriendly, even though the majority of household energy in Canada comes from hydro and nuclear. In Europe, home air conditioning is generally less common, in part due to higher energy costs and moderate summer temperatures. Southern European countries such as Greece, on the other hand, have seen a wide proliferation of home air-conditioning units in recent years. The lack of air conditioning in residences, residential care homes and medical facilities was identified as a contributing factor to the estimated 35,000 deaths mostly in Germany, France and Italy. 1.2.1 Air conditioners in Pakistan

Room air conditioner making industry in Pakistan has taken rapid strides during the last few years. The industry made a modest beginning in 1974, when a state enterprise produced the first domestic air conditioner. Today 13 companies have the facilities to assemble and manufacture air conditioners. However, currently, only nine units are in operation. Local production of room air conditioners increased from 6,754 in 1985-86 to 18,913 in 1990-91, showing an increase of 180 per cent per annum. ____________________________________
Air Conditioning, In Wikipedia, the free encyclopedia. Retrieved from http://en.wikipedia.org/wiki/Air_conditioning

1.3

Solar Energy

Solar energy is radiant energy that is produced by the sun. Every day the sun radiates, or sends out, an enormous amount of energy. The sun radiates more energy in one second than people have used since the beginning of time! Where does the energy come from that constantly radiate from the sun? It comes from within the sun itself. Like other stars, the sun is a big ball of gasesmostly hydrogen and helium atoms. The hydrogen atoms in the suns core combine to form helium and generate energy in a process called nuclear fusion.

1.3.1

Solar energy history

People have harnessed solar energy for centuries. As early as the 7th century B.C., people used simple magnifying glasses to concentrate the light of the sun into beams so hot they would cause wood to catch fire. More than 100 years ago in France, a scientist used heat from a solar collector to make steam to drive a steam engine. In the beginning of this century, scientists and engineers began researching ways to use solar energy in earnest. One important development was a remarkably efficient solar boiler invented by Charles Greeley Abbott, an American astrophysicist, in 1936. The solar water heater gained popularity at this time in Florida, California, and the Southwest. The industry started in the early 1920s and was in full swing just before World War II. This growth lasted until the mid- 1950s when low-cost natural gas became the primary fuel for heating American homes. The public and world governments remained largely indifferent to the possibilities of solar energy until the oil shortages of the 1970s. Today, people use solar energy to heat buildings and water and to generate electricity. Edmund Becquerel (1838) observed and published findings about the nature of materials to turn light into energy. They were considered interesting, but were not pursued.

______________________________________________
Secondary Energy Info book, National Energy Education Development Project, Retrieved from http://www.need.org/needpdf/infobook_activities/SecInfo/SolarS.pdf

Auguste Mouchout (1860), was the first man to patent a design for a motor running on solar energy. Receiving funds from the French monarch, he designed a device that turned solar energy into mechanical steam power and soon operated the first steam engine. He later connected the steam engine to a refrigeration device, illustrating that the suns rays can be utilized to make ice! He was awarded a medal for this. His groundbreaking research was cut short though. The French renegotiated a cheaper deal with England for the supply of coal and improved their transportation system for the delivery thereof. Mouchouts work towards finding an alternative was no longer considered a priority and he no longer received any funding from the monarch.

Willoughby Smith (1873), experimented with the use of selenium solar cells after discovering its sensitivity to light while testing material for underwater telegraph cables. William Adams (1876-1878), wrote the first book about Solar Energy called: A Substitute for Fuel in Tropical Countries. Him and his student Richard Day, experimented with the use of mirrors and was able to power a 2.5 horsepower steam engine. Much bigger than the Mouchout's 0.5 horse powered steam engine. His design, known as the Power Tower concept, is still in use today. Charles Fritz (1833), turned the sun's rays into electricity. His solar cell had a conversion rate of only 1-2%.Another big milestone for solar energy history! Charles Tellier (1885-1889), who is seen as the father of refrigeration, experimented with a nonconcentrating/ non-reflecting solar motor. He installed the first solar energy system for heating household water on top of his very own roof. However, his desire to pursue his refrigeration interests led to his abandonment of solar energy experiments. Aubrey Eneas (1892-1905), formed the first Solar Energy company - The Solar Motor Co. They sold the first Solar Energy system to Dr. A.J. Chandler of Mesa, Ariz for $2,160. It was destroyed less than a week later by a windstorm. They sold a second one to John May, but that one too, was destroyed by a hailstorm shortly afterwards. This led to the company's downfall. Henry Willsie (1904) recognized the need to store generated power and built 2 huge plants in California. He was the first to successfully use power at night after generating it during the day. Even so, he was not able to make a sale and his company too folded. Frank Shuman's company (1906-1914) , Sun Power Co, built the largest and most cost-effective solar energy system covering 10,000 square feet plus. Although it produced a lot of steam it did not produce enough pressure. Together with E.P. Haines he then formed Sun Power Co. Ltd. They built an irrigation plant just outside of Cairo, but unfortunately it was destroyed during the Great War. Calvin Fuller, Gerald Pearson and Daryl Chaplin of Bell Laboratories (1954) accidentally discovered the use of silicon as a semi-conductor, which led to the construction of a solar panel with an efficiency rate of 6%. The first commercial solar cell was made in 1956 available to the public at a very expensive $300 per watt. It was now being used in radios and toys.

During the 1950s-1960s space programs employed solar technologies. In 1958 the Vanguard I was launched. The first satellite that used solar energy to generate electricity. The Energy Crisis! .A bit of solar energy history we are all familiar with. Suddenly it became important to find an alternative form of energy in 1970 as we realized just how reliant we really are on non-renewable, finite resources like coal, oil and gas for our existence. Solar energy history was made as the price of solar cells dropped dramatically to about $20 per watt. A Los Angeles based company called Luz Co (1980-1991), produced 95% of the world's solarbased electricity. They were forced to shut their doors after investors withdrew from the project as the price of non-renewable fossil fuels declined and the future of state and federal incentives were not likely. _________________________________________ Solar Energy History. Retrieved from
http://www.need.org/needpdf/infobook_activities/SecInfo/SolarS.pdf

The chairman of the board said it best: "The failure of the world's largest solar electric company was not due to technological or business judgment failures but rather to failures of government regulatory bodies to recognize the economic and environmental benefits of solar thermal generating plants."

1.4

Statement of Problem

Electricity generation in Pakistan has shrunk by 50% in recent years due to an overreliance on hydroelectric power. In 2008, availability of power in Pakistan falls short of the population's needs by 15% Pakistan was hit by its worst power crisis in 2007, after the assassination of Benazir Bhutto and the following riots. Production fell by 6000 Megawatts and massive blackouts followed suit. The blame was laid on the then president, Pervez Musharraf, and was in his defeat. Load Shedding and power blackouts have become severe in Pakistan in recent years. The main problem with Pakistan's poor power generation is raising political instability, together with rising demands for power and lack of efficiency. In this fast world in order to survive it is very important for everyone to go for solar energy. The huge change in the world and economy including energy crisis recession is very rapid. The energy crisis in Pakistan and the severe condition of electric shortage has leaded us to situation of disaster.

The purpose of this study is to find out whether acceptance of solar energy and solar air conditioner can be adapted in the lifestyle of Pakistani people or not. There have been many improvements and revolutionary enhancements in other categories of products but comparatively solar market has not seen any big change since many years in Pakistan. The air-conditioning industry is also very important for a country like other industries of the world. The air-condition business is very much in other countries, now in last four to six years this industry is also become very common in Pakistan as well. The air-conditioning market is totally captured by the China and Malaysia, and we import most of air-conditioning brands from these countries & we pay extra duties for importing these equipment. Air-conditioning equipment are split A/C, Chillers, Air Handing Units, Fan Coil Units, Valves, Pumps, Building Management Systems, Cooling Towers and Fans etc. these items are used in central Airconditioning systems in commercial projects. We do not have enough local brands in the airconditioning field. This is the reasons the prices of the air-conditioning equipment has increased very much. The present situation is the recession situation and almost every country suffers in this problem. Almost every industry of all the country is affected by this recession period. Airconditioning industry is also very affected from this recession period. The prices of airconditioning equipment are also raise due to the inflation in dollar prices. Therefore the airconditioning industry is very affected and firms started to downsizing. The recent example of this is the L.G firm from Pakistan cut of its size and kick off 400 hundreds employees. In addition the so many projects in government, semi-government & private sector have stopped or slowed. Same situation in all the countries of the world. In 2008 almost three to four times prices of air-condition equipment revised. The other reasons also behind in this price fraction e.g. duty & tax on imported items is also raised in Pakistan. Due to that so many international brands are less marketed than local brands. People switch over on other alternatives.

1.5

Objectives
To study whether solar air conditioners are accepted in the market. Finding out the main problem of costumers and deriving a solution regarding prices and availability. Study the factors affecting the acceptability of solar air conditioners in the market.

The objectives of the study are as follow:

1.6

Hypothesis

Ho1: Acceptance of solar air conditioners is ignored due to its knowledge to costumers. H11: Solar Air conditioners will be accepted due to the knowledge of costumers. Ho2: There is a significant relationship between acceptance and risk taking. H12: There is no significant relation between acceptance and risk taking. H03: There is no significant relation between acceptance and price. ______________________________
Electricity Sector in Pakistan. In Wikipedia, the free encyclopedia. Retrieved from http://en.wikipedia.org/wiki/Electricity_sector_in_Pakistan

H13: There is a significant relation between acceptance and price. 1.6.1 Defining the variables

You won't be able to do very much in research unless you know how to talk about variables. A variable is any entity that can take on different values. 1.6.1.1 Dependent variable The dependent variable in the study is the acceptance of the product. 1.6.1.2 Independent variables The following are the independent variables:

Knowledge of the customer. Price. Risk taking.

1.7

Theoretical Framework

A theoretical framework is a collection of interrelated concepts, like a theory but not necessarily so well worked-out. A theoretical framework guides your research, determining what things you will measure, and what statistical relationships you will look for. Surprisingly, theoretical frameworks are also important in exploratory studies, where you really don't know much about what is going on, and are trying to learn more. There are two reasons why theoretical frameworks are important here.

It is very important to study the independent variables and its relation to the dependent variable as the study is about the factors affecting the acceptability of solar air conditioners in the market. 1.7.1 Knowledge of the customer

Knowledge of the costumer is the most important factor for the acceptability of the solar air conditioner in market. This relates to any segment and product in market, if the costumer doesnt has any knowledge of the product he or she may not buy it. Knowledge about the product or technology gives confidence and courage to make a decision for the product. This factor will be further discussed in chapter 4 in the form of questionnaire in which respondents were asked about the knowledge of solar technology. Product Knowledge comes in various forms. Product's features for its intended purpose, what goes with what, and how a product works. Many companies do have knowledge of their customers, but difficult to share or analyze and often it is incomplete. Moreover knowledge of the product allows the costumer to bargain and select the best according to its desire. You can justify your selection according to the knowledge you have about the product and the need you have. 1.7.2 Price

Price is an important factor in the acceptability of a new product in market. Nowadays we see new products launching in market with huge amount of retail prices which somehow is now affordable to many consumers who are also willing to buy it. In this period of recession and downsizing costumers make it very clear and be careful on what they are buying and why they are buying. In order to penetrate in the market price should be less but to that extent in which the production and promotion are catered. For this reason a questionnaire was distributed among 120 respondents to know their preferences over the buying decision. For that their monthly income according to their buying decision were taken and plotted on a graph which can help in understanding the buying or decision making factor according to the monthly income they have. This research is further discussed in chapter 4. 1.7.3 Risk taking

Risk concerns the deviation of one or more results of one or more future events from their expected value. Technically, the value of those results may be positive or negative. In studying decision making, it is critical to examine both the processes by which decision alternatives are identified, evaluated, and managed, and the actual selecting mechanism that leads to the decision choice.

10 The biggest risk a person takes is that he trusts that the product would satisfy his needs in proportion to the amount of money he pays for the product. There are other risks such as not knowing the range of products available, not knowing about substitutes, the opportunity cost of buying this product could be greater than buying something else thats required to a greater extent. Even the buying situation differs. Each time the buyer is to take a purchase decision, it may or may not be the same as the previous one.

According to the defined independent variables and dependent variable following theoretical framework has been developed which include the relation between price, knowledge of customer, innovation of product and risk taking of the customer with the acceptance of the product as shown in the figure (1.1).

Price

ACCEPTANCE

Knowledge of Costumers

Risk Taking of Costumers Fig 1.1: Theoretical Framework 1.7.4 Classification of study

This study is inductive as its purpose is to find out the rate of acceptance in relation to the innovation of a product as well as finding out the key terms which would help in making a strong and successful marketing plan for the launch of this product. Whether the costumers accept the solar air conditioners in market. And if they dont then what will be the main reason of ignoring an innovative item in market having beneficial characteristics for the future. 1.7.5 Explanation of the established relation with the variables The increased use of the air conditioners will affect the electricity supply in the country because it is very difficult to control the production process in the country. If the income levels of the people are high then the people will buy luxury items or those who can afford them.

11

The worse scenario of the electricity problem in Pakistan can be a key way to launch solar air conditioners. There can be problems regarding the acceptance of innovation. Lack of complete information of the product can also be a problem to its penetration in market. Some people are not risk takers and they tend to see if the product is a success in market or try to make their buying decision on the basis of word of mouth and popularity of the product.

CHAPTER 2 LITERATURE REVIEW

2.1 Introduction to Load Shedding Problem in Pakistan
Electricity in Pakistan is generated, transmitted, distributed and retail supplied by two vertically integrated public sector utilities: Water and Power Development Authority (WAPDA) for all of Pakistan (except Karachi), and the Karachi Electric Supply Corporation (KESC) for the City of Karachi and its surrounding areas. There are around 16 independent power producers that contribute significantly in electricity generation in Pakistan.

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For years, the matter of balancing Pakistan's supply against the demand for electricity has remained a largely unresolved matter. Pakistan faces a significant challenge in revamping its network responsible for the supply of electricity. Electricity generation in Pakistan has shrunk by 50% in recent years due to an overreliance on hydroelectric power. In 2008, availability of power in Pakistan falls short of the population's needs by 15% Pakistan was hit by its worst power crisis in 2007, after the assassination of Benazir Bhutto and the following riots. Production fell by 6000 Megawatts and massive blackouts followed suit. The blame was laid on the then president, Pervez Musharraf, and was instrumental in his defeat. Load Shedding (deliberate blackouts) and power blackouts have become severe in Pakistan in recent years. The main problem with Pakistan's poor power generation is raising political instability, together with rising demands for power. Table 2.1
Years
Existing Generation Proposal committed generation Total Existing/Committed Generation Expected Available Generation Demand Surplus/deficit Generation

2008
15903 530 16484

2009
15903 4235 20138

2010
15903 7226 23129

2011
15903 10115 26018

2012
15903 10556 26459

2013
15903 13307 29210

2014
15903 13520 29423

2015
15903 14607 30510

2016
15903 16134 32037

2017
15903 18448 34351

2018
15903 18448 34351

2019
15903 18448 34351

2020
15903 18448 34351

13146 16484 -3338

16110 17868 -1758

18503 19352 -849

20814 20874 -60

21167 22460 -1293

23368 24162 -758

23538 25919 -2381

24408 28029 -3621

25630 30223 -4593

27481 35504 -8023

27481 34918 -7437

27481 37907 10426

27481 41132 13651

Supply and Demand of Electricity in Pakistan

Source: Private Power and Infrastructure Board - Govt. of Pakistan Note: All values in the table are in MW (Mega Watt).

In table (2.1) the short run addressing difficult challenges such as the demand for a parity of treatment to both domestic and foreign investors must make some difference by way of attracting investors across the board. Given the growing demand for electricity, foreign investors must have a role in helping Pakistan meet this challenge. But the challenges faced by Pakistan are by no means easy. It is indeed the case that the business of reforming the electricity supply network is just not about short term and often incomplete measures of the kind that Pakistanis have been accustomed to. Even if Pakistan successfully set aside the vast funds which are necessary to finance such a turnaround, the time taken to ensure the supply of all the technical ingredients must in itself make the

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task formidably challenging. In the environment which prevails across the world today, there is already a considerable line-up of both individuals and countries which have placed orders to buy new equipment. Indeed, Pakistani officials are all too aware of international market conditions which only add to the difficulty surrounding their task. Though sorting out global market conditions are just not in reach of one country alone, other matters are indeed within Pakistan's grasp. These include the need to turn around popular habits which hardly help to curtail the usage of electricity, with wastages and deliberate inefficiencies being the principal factors.

_________________________________________
Supply and Demand Proposition 2008-2020. Retrieved from http://www.ppib.gov.pk/SupplyDemand.html\

Electricity Sector in Pakistan. In Wikipedia free encyclopedia. Retrieved from http://en.wikipedia.org/wiki/Electricity_sector_in_Pakistan

2.1.1

Electricity - consumption: 72.2 billion KWH (2007 EST.)

Fig 2.1: Electricity Consumption

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The above figure (2.1) consists of the total electricity consumed in the previous years with its date of information including the percentage changes occurred in the past years. Table 2.2 Electricity Consumption Years 2003 2004 2005 2006 2007 2008 2009 2010 Electricity- Consumption 62,270,000,000 62,270,000,000 52,660,000,000 71,540,000,000 74,540,000,000 68,400,000,000 64,400,000,000 72,200,000,000 Rank 34 35 39 34 33 34 34 36 0.00% -15.43% 35.85% 4.31% -8.34% 0.00% 5.56% Percent Change Date of Info 2001 2001 2003 2003 2004 2006est. 2007est. 2007 est.

Table (2.2) is the tabular form of the figure (2.1) which shows the estimated electricity consumption in KWH.
__________________________________________ CIA World Fact book - February 19, 2010. Retrieved from

http://www.indexmundi.com/pakistan/electricity_consumption.html

2.1.2

Electricity - production: 90.8 billion KWH (2007 EST.)

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Fig 2.2: Electricity Production The above figure (2.2) shows the electricity production done in the previous years including its percentage changes and ranking in the world. Table 2.3 Electricity Production Years 2003 2004 2005 2006 2007 2008 2009 2010 Electricity- Production 66,960,000,000 66,960,000,000 75,270,000,000 76,920,000,000 80,240,000,000 93,260,000,000 93,260,000,000 90,800,000,000 Rank 36 37 33 35 32 32 32 32 0.00% 12.41% 2.19% 4.32% 16.23% 0.00% -2.64% Percent Change Date of Info 2001 2001 2003 2003 2004 2007est. 2007est. 2007 est.

Table (2.3) is the tabular from of the above figure (2.2) which shows the estimated electricity production in KWH.
______________________________________ CIA World Fact book - February 19, 2010. Retrieved from http://www.indexmundi.com/pakistan/electricity_production.html

2.2

Total Installed Capacity

Total installed generation capacity witnessed an increase of 2.1 percent during 200910 against the 1.0 percent growth in corresponding period last year with the share of 31.6 percent in total installed capacity during 200910, private sector witnessed the prominent growth of 7.1 percent in its installed capacity during the period under review. On the other hand, installed capacity of WAPDA declined by 0.5 percent during JulyMarch 200910. Furthermore, the installed capacity of KESC stood at 1,955 MW during the period under review. Table 2.4 Total Installed Capacity
S.NO Power Company Installed capacity 1 WAPDA Hydel Thermal 11,454 6,555 4,899 57.9 57.2 42.8 Share (%) Installed capacity 2009-10 11,399 6,555 4,844 5605 57.5 42.5 -0.5 0.0 -1.1 Share (%) Change

16 2 3 4 IPPs Nuclear KESC Total 5,954 462 1,910.0 19,780 30.1 2.3 9.7 100.0 6,374 462 1,955 20,190 31.6 2.3 9.7 100.0 7.1 0.0 2.4 2.1

Source: Hydrocarbon Development Institute of Pakistan & PEPCO In further part of the report we will study the solar energy system, its types and how it is is made including the solar air conditioner which we will design for the Pakistan market. 2.3

Solar Energy System

Solar power or Solar Energy is the energy we derive form from rays and heat of sun. It is in use from the time immemorial. However it is now that mankind has realized its importance as a safe and inexpensive energy source. Pakistan has high potential of renewable energy sources. A very large part of the rural Population does not have the facility of electricity because they are either too remote or it is found too expensive to connect their villages to the national grid station. Pakistan being in the sunny belt is ideally located to take advantage of solar energy. This energy sources is widely distributed and abundantly available in the country. During last 15 years Pakistan has shown quite encouraging progress in the use of photovoltaic cells. Currently electrical power derived from solar energy is being used is being used in some public parks. These include Khalid bin Waleed Park in Peshawar and the Race Course Park in Rawalpindi. The Public Health department has installed solar water pump for drinking purposes in some parts of the country. Both public and private sector are playing their role. 2.4

Governments Role

The Pakistan Electric Power Company (PEPCO) has sought a 48 percent increase in power tariff to bridge the Rs 180-billion gap in power production costs and the money paid by utility consumers, official sources told Daily Times on Tuesday. This demand has put the economic managers in a difficult position. They are exploring all possible options, including tariff restructuring through elimination of subsidies, to bridge the gap in power production costs and tariff recovery. Other options to overcome the 48-percent deficit include introduction of major reforms to eliminate line losses, electricity theft and inefficiency in the system through investment to upgrade obsolete equipment. However, the economic managers strongly feel that a mix of reforms, such as partial increase in power tariff, reduction in all kinds of losses and elimination of subsidies can help reduce the Rs 180-billion gap. The government believes that it is extremely difficult to consider any increase in electricity prices, even though there is immense pressure to eliminate subsidies.

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The sources said that government officials would try to convince the International Monetary Fund (IMF) that any increase in power tariff in these circumstances is not possible. Technical discussions with the IMF are currently underway in Washington for the extension of the deadline to meet these conditions.

_____________________________________
Pepco wants 48% Hike in Tariff Prices. September 01, 2010.Retrieved from http://www.dailytimes.com.pk/default.asp?page=2010\09\01\story_1-9-2010_pg7_28

CHAPTER-3 RESEARCH METHODOLOGY

3.1 Research Design

A primary interpretation of design research is that it is concerned with undertaking research into the design process. Secondary interpretations would refer to undertaking research within the process of design. The overall intention is to better understand and to improve the design The objective of this study is to find out whether Acceptance of a product by customer has any significant relationship with the knowledge of costumer, its personal status, the decision making power etc. This study will eventually help us to find out the key elements that can help us make a strong marketing plan to launch solar air conditioners in Pakistan and make it a consumer product and available for everyone.

3.2

Population of the Study

3.2.1 Population

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In present study, the population is general public who uses air conditioners in summers and the buying is at its peak in summers due to new house development and according to their needs and wants. Our sample population for the project included include Model Town, DHA, Gulberg, Shadman and Township. A questionnaire was developed which was costumer based and filled from different locations in Lahore. There were a number of 120 questionnaires that were filled by the respondents themselves.

3.3

Sampling Strategy

Keeping in view, the type and nature of study I selected Random sampling. Therefore, 120 people are forming the sample of my study. Questionnaire was costumer based because it is well said that costumer is always right. My focus was totally on costumers because this is the only source of information from which we can know what they want. If the customer wants its retailer automatically pursue it because innovation is always done to resolve the current issues faced by the users of a product by improving it in all those aspects. 3.3.1 Variables

A variable is anything that can be changed or it is a quantity that may have number of different values. The research is focused on the variable 1. Dependent Variable Acceptance of the Product. 2. Independent Variable Knowledge of costumers Risk taking Price

3.4

Tools for Data Collection

The success of a researcher depends on the data he has collected. The collection of accurate data depends upon the careful construction of a tool for data collection. For this particular study it is considered appropriate to use questionnaire. 3.4.1 Pretesting

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Pre-testing for the present study was done having almost similar qualities as to which were to be studied later. After pre-testing some changes were made on the basis of responses. There were some questions that didnt work. Researcher modified the questions; some new questions were also added and then gave the schedule final shape. The language of the questions was on the level of understanding of respondents.

3.5

Data Collection

3.5.1 Classification of data Classification of data refers to questions about demographics of respondents including information as age, education level, marital status and income. My questionnaire included Age, Gender and Monthly Income, Educational Qualification questions which were asked in the beginning of the questionnaire. I developed questionnaires for Customer and personally administered to 120 Customers. First of all I introduced myself and significance of the innovative product that is about to be launched. I also explained the purpose of the study and it took me 10 minutes on average to complete one questionnaire. 3.5.2 Variables and measures The questionnaire consisted of 15 questions. First five questions tapped personal information . Next five questions were multiple choices regarding their frequency of using the product and modes of advertisement that are most influential according to them. Remaining questions focused on preference and acceptability of the Product.

3.6

Interpretation of Data

After survey of the Air conditioner markets and fulfillment of questionnaire by customers, Data is analyzed. In this study bar charts and tables are used for statistical analysis.

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CHAPTER - 4 DATA ANALYSIS

Analysis of data is a process of inspecting, cleaning, transforming, and modeling data with the goal of highlighting useful information, suggesting conclusions, and supporting decision making. Data analysis has multiple facets and approaches, encompassing diverse techniques under a variety of names, in different business, science, and social science domains. This study is particularly about the launch of an innovative product and its rate of acceptance by the customers. By conducting this research we would be able to map out the best Marketing Plan possible to launch this product. I made questionnaires to carry out this research which was costumer based and for analyzing the data I am using Tables and Bar Charts.

4.1

Costumer Data Analysis

This data consists of general information about the sample by which one can analyze the effects of other variable on the acceptance of this product. The brief study of the research findings of the sample includes Gender, Age, Monthly Income, For the fulfillment of these questionnaires, researcher went to many places present in Lahore. No, particular group was selected to fill out these questionnaires all the questions were answered by random respondents. 4.1.1 Respondents profile

21

The respondents profile was basically the personal information of the respondent which included the age group, marital status, their income per month, educational qualification etc.

Table 4.1 Gender Group Gender Male Female Total Frequency 98 22 120 Percent 81.66 18.33 99.99

The above table shows the gender distribution of the respondents which is approx 81 % male and 18% female .Females and at a working level was hard to locate and fill question still the best was done to approach them and include a working woman in the sample to know the acceptance of solar air conditioners in market. A graphic representation of the above table is as follow:

Fig 4.1: Gender Group

The above figure shows maximum value in male which is 81.66%.

Table 4.2 Age Group

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Age Group Less than 18 Years 18-24 Years 25-31 Years 32-45 Years Total

Frequency 0 30 78 12 120

Percent 0 25 65 10 100

The above table indicates the age group of the respondents in frequencies and percentages 18 to 24 years of respondents were 25%, 25 to 31 age of respondents were of 65% and 32 to 45 year of respondents were of 10 percent.

Fig 4.2: Age Group Above figure shows the age group and maximum results were in the years from 25 to 31 having 65% responses.

Table 4.3 Educational Qualification Education Intermediate Undergraduate Graduate Post Graduate Total Frequency 0 2 76 42 120 Percent 0 1.66 63.33 35 99.99

The above table (4.3) is regarding the educational qualification of the respondents which was necessary to see according to their qualification and their income per month what is their decision power, what is their acceptance to innovation. 1.66% was gathered to be under graduate, 63.66 % of the respondents were graduate and found to be having a job life and some were doing their own business, while post graduate were 35%. The questionnaire was distributed among literate and educationally qualified a respondent which was necessary because such people have chances of accepting and adapting innovation which is the exact target.

23

Fig 4.3: Educational Qualification The above figure 4.3 shows the educational qualification and 63% in graduate.

Table 4.4 Marital Status Marital Status Single Divorced Married Married with Kids Total Frequency 34 0 6 80 120 Percent 28.33 0 5 66.66 99.99

Table (4.4) indicates the marital status of the respondent we collected that many of them were married with kinds and had a percentage of 66.66% which was the highest among the sample respondents then married respondents were 5% and single respondents were 28.33% which helped us to understand that married person with kids have a strong buying and responsible buying power. Their questionnaire was thoroughly evaluated regarding their answers to the questions of acceptability and consumer behavior which are mentioned in the further end of the questionnaire evaluation.

Fig 4.4: Marital Status

Table 4.5 Income per Month

Income Per Month

Frequency

Percent

24

Less than 20,000 Rs.20,000 Rs.39,999 Rs.40,000- Rs.59,000 Rs Rs.60,000-Rs.79,999 Rs.80,000 or more Total

4 67 15 19 15 120

3.33 55.83 12.5 15.83 12.5 99.99

The above table (4.5) indicates the income per month of the respondent with options distributed in terms of cash and segmented to know in which section they lie. The frequency section represents the quantity of the respondents lying in that segment. The percent is the percentage of the frequencies taken and counted from the questionnaire. This helps to understand the income per month and the expected saving which is the key answer to the acceptability and risk taking of the costumer to buy a solar air conditioner.

Fig 4.5: Income per Month Figure (4.5) represents the income per months of the respondents. Table 4.6 Options Yes No Total Frequencies 120 0 120 Availability of Air Conditioners percents 100 0 100

Table (4.6) indicates the percentage and frequencies of the costumers who have air conditioners at their place. The question had only two options which were yes or no.

Fig 4.6: Availability of Air Conditioner

25

The above figure (4.6) is indicating the availability of air conditioners which was a general question and results were 100% in the section of yes.

Table 4.7 Type of Air Conditioner Options window split Total Frequencies 18 102 120 Percents 15 85 100

Table (4.7) shows the type of air conditioner which the respondents had. There were also a number of 120 frequencies in which 15% of the sample respondents had window AC and 85% of the sample had split air conditioners.

Fig 4.7: Type of Air Conditioner The above figure (4.7) shows the type of air conditioner. There were two options and the maximum answers were in the favor of split air conditioner having a percentage value of 85%.

Table 4.8 Usage of Air Conditioner in Months Options Frequencies Percent

26

3-5 months 5-7 months 7-9 months More than that Total

14 66 36 4 120

11.66 55 30 3.33 100

The table above table (4.8) represents the usage of air conditioners by the respondent in months in a year. This had the options of months in patches. 11.6% respondents use from 3 to 5 months , 55% respondents use air conditioners from 5 to 7 months, 30 percent respondents use from 7 to 9 months and 3.33 respondents use more than that . a graphic representation of the table is as follow.

Fig 4.8: Usage of Air Conditioner in Months The above figure (4.8) represents the usage of air conditioner monthly in which maximum answers were in 5 to 7 hours having percentage value of 55% among the options.

Table 4.9 Options 1 ton 1.5 tons 2 tons 4 tons 6 tons More than that Total Frequencies 68 46 6 0 0 0 120 Capacity of Air Conditioner Percent 56.6 38.33 5 0 0 0 100

27

Table (4.9) represents the capacity of cooling unit capacities the respondents have in the sample. 56% of the respondents have 1 ton split air conditioners, 38.33 % have 1.5 ton of air conditioner and 5% of 120 respondents have 2 ton air conditioner. A graphical representation of the above table is as follow:

Fig 4.9: Capacity of Air Conditioner Above figure (4.9) shows the capacity of air conditioners having maximum value of 56.6% of 1 ton air conditioner. Table 4.10 Daily Hourly Usage of Air Conditioners Options 1-3 hours 3-5 hours 5-7 hours 7-9 hours 9-12 hours more than that Total Frequencies 0 19 44 38 16 3 120 Percent 0 15.83 36.66 31.66 13.33 2.5 99.98

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Table (4.10) shows the hourly usage of air conditioner daily which helped us to understand the importance of the costumer related to air conditioners, which was a very good vacuum to be filled in the market through solar air conditioners. 15.83 % of the respondents use for 3 to 5 hours , 36.66 % of the respondents use from 5 to 7 hours , 31.66% of the respondents use from 7 to 9 hours , 13.33% of the respondents use from 9 to 12 hours and 2.5% respondents use more than that daily. A graphic representation of the above table is given below:

Fig 4.10: Daily Hourly Usages of Air Conditioners The above figure (4.10) shows daily use of air conditioners. Table 4.11 Knowledge Regarding Solar Energy Options Yes No Total Frequencies 113 7 120 Percent 94.16 5.83 99.99

The above table was a simple question regarding the knowledge of the solar energy whether someone knows about solar energy or not. The result came out to be very interesting when the samples were collected and the frequencies were counted almost 94% of the respondents knew about the solar energy and almost 6 % of them didnt know about it. A graphic representation of the table is given below:

Fig 4.11: Knowledge Regarding Solar Energy The above figure (4.11) shows the knowledge of the costumers about the solar energy which was unexpectedly very good having 94.16% knowhow of the technology.

29

Table 4.12 Acceptance of Solar Air Conditioners Option Yes No Total Frequencies 97 23 120 Percent 80.83 19.16 99.99

The above table (4.11) was again a simple question regarding the acceptance of solar air conditioners at their place. The results were very good in the favor of the solar air conditioner system. 80.83% respondents accepted to have a solar air conditioner at their place whereas almost 20% respondent ignored saying NO.

Fig 4.12: Acceptance of Solar Air Conditioners The above figure (4.12) represents the preferences of having solar air conditioners. The result shows 80.8% in the favor of having solar air conditioners by the respondents.

Table 4.13 Regarding Consumer Behavior Options yes No May be I'll buy. Total Frequencies 97 6 17 120 Percent 80.83 5 14.16 99.99

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Table (4.13) was a question which was regarding the customer satisfaction and consumer behavior. It was regarding the after sale services and warranty of the parts. The accepted percentage remained same which was 80% while the decision of No changed a slight bit and respondents liked to select the option that May be Ill buy which shows that respondents and the sample which we approached did seem to have keen interest in having a solar air conditioner at their place. The above table helped us to visualize the decision making of the respondent. A graphic representation of the above scenario is given below:

Fig 4.13: Regarding Consumer Behavior The above fig (4.13) represents the priority of the respondents buying related to service and warranty. Table 4.14 Influential Source of Advertisement Mode of Advertisement TV Radio Hoardings Print Total Frequency 62 6 30 22 120 Percentage 51.66 5 25 18.33

The above table (4.14) is a very important key point to evaluate that what source is the most influenced to the respondent in the form of advertisement. This is also a form of consumer behavior and marketing scheme. Our questionnaire showed results mostly in TV commercial which was 51.66% almost 5% of the respondents said that they get influenced by radio as the narration seems to be appealing, 25 % of the respondents agreed on hoardings and 18% of the respondents agreed on print media which include brochure news paper or wallpapers etc. A graphic representation of the above scenario is given below:

Fig 4.14: Influential Source of Advertisement

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Table 4.15 Most Important Factor When Costumers Buys a Product Factors Price Quality Uniqueness Guaranty Total Frequency 17 27 32 44 120 Percent 14.16 22.5 26.66 36.66 99.99

Table (4.15) represents the decision making of the respondent depending upon their own priority of characteristics the questionnaire and frequency detail showed that most of them demanded guaranty of the product in terms of after sale services and warranty which turned out to be 36%, some agreed on the uniqueness which was almost 26 %, quality was of a consideration also of about 22%, price doesnt seems to be a matter to the respondents which was 14%. This shows that the respondents or consumers demand uniqueness and mostly guaranty in their product and price is not that big issue. A graphical representation of the above table is given below:

Fig 4.15: Most Important Factor When Costumers Buys a Product Figure (4.15) represents the buying decision of the respondent in terms of quality, uniqueness guaranty and price. Every option had average responses.

4.2

Price Analysis

In this section we will study the price of what the solar air conditioner costs and its comparison with the electricity bill we give against the units consumed by the split air conditioner already fitted in our homes. Prices or the cost in the form of bills including domestic and commercial usage will be tested. Afterwards we will try to clear our variable of price in relation to the acceptance of solar air conditioners in our environment. I have gathered much amount of data to study regarding the cost of a solar air conditioner and the domestic and commercial bill we pay monthly on average usages. In order to calculate the units per month , cost per month, GST and then the total cost on very deep research regarding power energy and mathematics I came to know that the calculations

32

were not that difficult. First of all we should know the amperes and watts of the air conditioners according to their BTU. The calculations are based on both domestic and commercial usage of air conditioner and then we will evaluate the pricing and analysis of the investment of the solar air conditioner. 4.2.1 Calculating power in kilo watts Formula: A typical formula which we studied in physics in matriculation or in our earlier studies. In order to calculate wattage of any product we need to know its ampere which it uses and multiply it with the volts. Power = Volts * Ampere P=VI Where P = Power V = Volts I = Amperes

Power on the left has the unit of watts so on the right side of the equation we have two variables volts and amperes.

Table 4.16 Tons 1 1.5 2 1.5 ton window Amperes 6 10 15 19 Volts 220 220 220 220 Watts 1320 2200 3300 4180 Kilo watts /KW 1.32 2.2 3.3 4.18

Calculating Power in Kilo Watts Note: Kilo watts are calculated by dividing the watts by 1000.

33

4.2.2

Calculating units consumed per month

In order to consume units per month we have to calculate units per day. Actually the units consumed are the watts per hour consumed. E.g. assuming the case of a 1 ton air conditioner it is 1.32 KW. If it is turned on for 6 hours per day it consumes 7.92 units or kilo watt hour (KWH) per day which is approximately 8 units. And if we want to calculate the same consumption per month we multiply it with 30 or 31 to know the units consumed per month. For example: Watts = 1.32 KW Hours consumed = 6 Consumption per Day = 1.32 KW * 6 hours = 7.92 KWH (kilo watt per hour) = 8 KWH Consumption per Month= 8 KWH * 31 Days per Month =248 Units per Months 4.2.3 Calculating cost per month:

As prescribed by PEPCO the tariff varies from units consumed a list of the applied tariff with effective of October 2010 is mentioned below or the domestic and commercial price.

4.2.4 Domestic tariff plan Units 1-100 100- 300 300- 700 700 and above Table 4.17 Variables Charges Rs/KW 4.28 6.47 10.44 13.03

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Domestic Tariff Plan

The above table consists of the domestic tariff plan of the electricity bills which we pay. 4.2.5 Commercial tariff plan Table 4.18 Commercial Tariff Plan Units Sanctioned load up to 5 KW Exceeding 5kw Fixed Charges 346 Variable Charges Rs/KW 12.78 7.98

The above table consists of the commercial tariff plans of the electricity bills. 4.2.6 GST applied:

GST is general sales tax which according to the government is 16% of the taxable amount as mentioned on our utility bills and on websites of PEPC0, LESCO AND KESC. 16% which is applied on the cost per month we calculated and then added to calculate the total cost. 4.2.7 Total Cost per Month:

Total cost is the sum of the GST and the cost per month we calculated.

4.3
4.3.1

Domestic Unit Consumed

Calculation for 1 ton air conditioner Table 4.19 Domestic 1 Ton Air Conditioner Costing

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Hours/Day 5 7 9 12 14 16 18

Units/Month 210 294 378 504 588 672 756

Cost/Month 1140 1683 2536 3851 4728 5606 6628

GST 182 270 406 616 757 897 1061

Total cost /Month 1322 1952 2942 4467 5485 6503 7689

4.3.2

Calculation for 1.5 ton air conditioner Table 4.20 Domestic 1.5 Ton Air Conditioner Costing

Hours/Day 5 7 9 12 14 16 18

Units/Month 341 477 613 818 954 1091 1227

Cost/Month 2150 3570 4990 7435 9208 10993 12765

GST 344 571 799 1190 1473 1759 2041

Total cost /Month 2494 4141 5789 8625 10681 12752 14806

4.3.3

Calculation for 2 ton air conditioner Table 4.21

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Domestic 2 Ton Air Conditioner Costing

4.3.4

Window air conditioner costing Table 4.22

Hours/Month 5 Hours/Day 7 9 5 12 7 14 9 16 12 18 14 16 18

Units/Month 647 Units / Month 907 1166 210 1555 294 1814 378 2073 504 2333 588 672 756

Cost/Month 5355 Cost/Month 8595 11969 2631 17038 3683 20413 4536 23788 6315 27175 7367 8420 9450

GST 857 GST 1375 1915 421 2726 590 3266 725 3806 1010 4348 1178 1347 1512

Total Cost /Month 6212 Total Cost 9970 /Month 13884 3052 19764 4273 23679 5261 27594 7325 31523 8545 9767 10962

Domestic Window Air Conditioner Costing

4.4
4.4.1

Commercial Unit Consumed

Calculation for 1 ton air conditioner Table 4.23 Commercial 1 Ton Air Conditioner Costing Hours/Day Units/Month Cost/Month GST Total cost /Month

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5 7 9 12 14 16 18

542 716 920 1227 1432 1636 1841

4248 6106 8765 12765 15475 18108 20743

680 977 1402 2042 2476 2897 3318

4928 7083 10167 14807 17951 21005 24061

4.4.2

Calculation for 1.5 ton air conditioner Table 4.24 Commercial 1.5 Ton Air Conditioner Costing

Hours/Day

Units/Month

Cost/Month

GST

Total Cost /Month 4944 6916 8888 11861 13833 15819 17790

5 7 9 12 14 16 18

341 477 613 818 954 1091 1227

4262 5962 7662 10225 11925 13637 15337

682 954 1226 1636 1908 2182 2453

4.4.3

Calculation for 2 ton air conditioner Table 4.25 Commercial 2 Ton Air Conditioner Costing

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Hours/Month 5 7 9 12 14 16 18

Units/Month 542 716 920 1227 1432 1636 1841

Cost/Month 6775 8950 11500 15337 17900 20450 23012

GST 1084 1432 1840 2454 2864 3272 3682

Total Cost /Month 7859 10382 13340 17791 20764 23722 26694

4.4.4

Window air conditioner commercial costing Table 4.26

Hours/Month

Units/Month

Cost/Month

GST

Total Cost /Month 9383 13152 16907 22548 26303 30058 33828

5 7 9 12 14 16 18

647 907 1166 1555 1814 2073 2333

8088 11338 14575 19438 22675 25912 29162

1295 1814 2332 3110 3628 4146 4666

Commercial Window Air Conditioner Costing

4.5

Solar Ai Conditioner Plan

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We must know for all the ones who study this report that how does the solar energy system works. A solar energy system consists of the following items. 4.5.1.1 Solar panels A solar panel (photovoltaic module or photovoltaic panel) is a packaged interconnected assembly of solar cells, also known as photovoltaic cells. The solar panel can be used as a component of a larger photovoltaic system to generate and supply electricity in commercial and residential applications. 4.5.1.2 Inverter An inverter is an electrical device that converts direct current (DC) to alternating current (AC); the converted AC can be at any required voltage and frequency with the use of appropriate transformers, switching, and control circuits. 4.5.1.3 Charge controller: A charge controller, charge regulator or battery regulator limits the rate at which electric current is added to or drawn from electric batteries. In addition to these a solar energy system consists of batteries which may be dry or acid also. The below given diagram can explain the working of a solar energy system.

Fig4.16: How Solar Works Following the above fig (4.16) we can easily get to know about the energy flow of the system. The solar energy system flows as the same as if u has an unlimited UPS working. The solar panel takes sunlight from the sun and produces an electric charge which is controlled by a charge

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controller and the flow of energy to move towards the charge controller which does not allow overflowing the charge going towards the batteries. As we must know that the batteries produce DC (Direct current) current and most of our items in our house are operated on AC (Alternate Current). For this purpose an inverter is used to invert the DC current to AC current and our system is ready to be used. 4.5.2 Estimated price for a solar air conditioner

Through sources it was found that a solar air conditioner is primarily a solar energy system in which you can even use your own air conditioner in the above diagram explained when then DC is inverted to AC you can plug anything to it .with the advantage of plugging and playing it unlimitedly having a disconnection from the electricity company. The estimated price taken from several companies from Lahore, Karachi and Islamabad which even included the importers. The below given table (4.27) contains the prices: Table 4.27 Estimated Price of Solar Air Conditioner Tons 1 1.5 2 Unit Price 25000/32000/44000/ Solar System Price/Approximately 400,000/600,000/800,000/-

4.5.2.1 Solar panel warranty The solar panel provided by the companies or retailers give it with a 25 years warranty which was found all over the world and is the key advantage for a costumer with a complete satisfaction that a solar panel which is the main backbone of the whole system has a warranty of not even one, two, ten but twenty five (25) years.

4.5.2.2 Batteries warranty

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The batteries provided by the retailers offer a warranty of one year. Even if we buy a battery from a retailer separately it comes with a minimum warranty of 8 months. 4.5.2.3 After sale services: The services provided mainly free maintenance for one year by the companies/retailers which was confirmed also calling at their costumer services. 4.5.2.4 No technology barrier Another point to be noted is that if we consider the basic UPS attached at our homes contain the basic charge controller which controls the charge on the batter not to overcharge them and an inverter which can be fixed by any electrician.

CHAPTER5 SUMMARY, FINDINGS, LIMITATIONS AND CONCLUSION

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5.1

Summary

The brief summary is that the study was conducted to give a suggestion in the current conditions or any objective. On deep focus on the current conditions in the market I decided to give the decision of solar air conditioners in the market of Pakistan. The research turned out to be very interesting and throughout the findings the conditions of Pakistan were torn out and found to be very problematic even in the coming years. The Pakistani people related to Punjab Baluchistan and Sindh are continuous users of air conditioners. Therefore I feel that solar air conditioners can take a major role in the market and fulfill the usage of costumers and gain its acceptance.
5.2

Findings
Gaps in current market

5.2.1

After analyzing the data of customers sample, problems identified in the beginning were found present in the current Pakistani situation of electricity and the rising prices per unit including the shortage of electricity. The solar energy system in the current market can gain a huge acceptance and have a great gap to fill in the market. 5.2.1.2 Quality & price

Other useful information was the quality preference of the customers which is a valuable point for us because quality is the main attribute of our product. Price turned out to be the first most important factor for customers which was concluded in chapter 4 while calculating the monthly consumption of electricity bills which we pay at such higher rated including the general sales tax. Moreover the product comes with a 25 years warranty for the solar panel which proves to be very good in quality and the maintenance discussed was not a big deal.

5.2.1.3 Target audience After reviewing the results of this study it is very clear that the customers that would be most suitable for us to target are those who have monthly income of 26,000 to 50,000. Because such

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costumers will contribute more in their saving and can prefer a onetime investment for their luxury living.

5.3

Limitation

This study is limited to solar energy and cannot be generalized for all types of products.

5.4

Conclusion

The findings of this study led to the conclusion that the level of acceptance of a product has significant relationship with the innovation of a product. The problems found in Pakistan are the shortage and high unit prices of electricity bills which have a lot of time to be cured. This study also revealed that customers in Pakistan have high rate of change acceptance. They are willing to try new and improved products. They have become more knowledgeable and informative about what their needs are and what they want. It was also found that TV advertisement is the most influential medium of advertisement which would be helpful for future innovative product launches. Therefore we can conclude that solar air conditioners can be accepted in Pakistani market if the costumer careful understands its advantage and price value at the current situation. Moreover it is a luxury and such items do not need to be taken in a sense to give the invested amount back. Though solar air conditioners or solar energy systems are a medium of one time investment with slight maintenance and provide saving for your electricity bills including taxes.

REFERENCES
Air Conditioning, In Wikipedia, the free encyclopedia. Retrieved from http://en.wikipedia.org/wiki/Air_conditioning

44

CIA World Fact book - February 19, 2010. Retrieved from http://www.indexmundi.com/pakistan/electricity_production.html

CIA World Fact book - February 19, 2010. Retrieved from http://www.indexmundi.com/pakistan/electricity_consumption.html

Electricity Sector in Pakistan. In Wikipedia free encyclopedia. Retrieved from http://en.wikipedia.org/wiki/Electricity_sector_in_Pakistan

Pepco wants 48% Hike in Tariff Prices. September 01, 2010.Retrieved from http://www.dailytimes.com.pk/default.asp?page=2010\09\01\story_1-9-2010_pg7_28 Supply and Demand proposition .Retrieved from http://www.ppib.gov.pk/SupplyDemand.html\

Solar Energy History. Retrieved from http://www.need.org/needpdf/infobook_activities/SecInfo/SolarS.pdf Secondary Energy Info book, National Energy Education Development Project , Retrieved from http://www.need.org/needpdf/infobook_activities/SecInfo/SolarS.pdf

APPENDIX - 1

QUESTOIONNAIRE
Notice: Thank You for your participation in the survey. This survey is being exclusively conducted for the educational purposes, and the information provided by you would be kept confidential. It will neither be shared with nor

45
shown to any member outside our organization at any time. Your cooperation would be highly appreciated.

Respondents Name: ____________________________________________________ Location: ______________________________________________________________ Surveyor: ______________________________________________________________

Matriculation Or less1 Intermediate2 Under Educational Qualification Graduate3 Graduate4 Post Graduate5 Less than 18 years1 18-24 years2 25-31 Years3 31-45 Age Group Years4 46 Years and above5 Male1 Female2 Single1 Divorced2 Married3 Married with kids4 Less than Rs. 200001 Rs.40,000 Rs.59,9993 Rs. 80,000 or more5 Income Per Month Rs.20,000 Rs.39,9992 Rs.60,000 Rs.79,9994

Gender Marital Status

1-Do you have any Air Conditioner at your place?

Yes

No

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2-Which type of Air Conditioner do you have ? a.) window

b.) split.

3- What is the capacity of your cooling unit? a.)1Ton b.)1.5 Ton c.)2Ton d.)4Ton

4- How many months do you use your air conditioner in a year ? a.)3-5 Months b.)5 7 Months c.)7-9Months

5-How many hours do you use your cooling unit daily? a.)1-3 Hours e.)9-12 Hours b.)3-5Hours f.)More than above. c.)5-7Hours d.)7-9Hours

6-Have you heard about Solar Energy? Yes No

7-Would you like to have a solar air conditioner at your place? Yes No

8-If the company providing solar air conditioner gives after sale services and warranty what will be your purchase decision? Yes No May be Ill Buy

9-What is the most influential mode of advertisement?

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a.)TV

b.)Radio

c.)Hoarding

d.)Print

10-What factor is most important when you buy any product? a.)Price b.)Quality c.) Uniqueness d).Guaranty

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