Why not light a bulb or tube light? That too would remove darkness.
But the traditional oil lamp has a further spiritual significance. The oil or ghee in the lamp symbolizes our vaasanas or negative tendencies and the wick, the ego. When lit by spiritual knowledge, the vaasanas get slowly exhausted and the ego too finally perishes. The flame of a lamp always burns upwards. Similarly we should acquire such knowledge as to take us towards higher ideals.
Whilst lighting the lamp we thus pray:
Deepajyothi parabrahma Deepa sarva tamopahaha
Deepena saadhyate saram Sandhyaa deepo namostute
I prostrate to the dawn/dusk lamp; whose light is the Knowledge Principle (the Supreme Lord), which removes the darkness of ignorance and by which all can be achieved in life.
To Light lamp the Cow’s ghee is preferable but Til Oil is OK. This will genearte a positive energy in the house. The light is to be faced towards God. It gives a good feeling to see God in the flame’s light. Generally, Hindus perform Prayers at least twice a day.