The Solid-State and Other Energy-Efficient Lighting market to grow from USD 118.3 billion in 2015 to USD 174.5 billion by 2022, at a Compound Annual Growth Rate (CAGR) of 5.4% during the forecast period. The growth of this market is driven by the increasing awareness about energy-efficient lighting technologies. The objective of the report is to define, describe, and forecast the solid-state and other energy-efficient lighting market size based on technology, installation type, application, offering, and region.
“Market for service is expected to grow at the highest CAGR during the forecast period.”
On the basis of offering, the solid-state and other energy-efficient lighting market has been segmented into hardware, software, and services. The market for services is expected to grow at the highest CAGR during the forecast period. Growing urbanization and expansion of cities are the major reasons for the growth of services in the solid-state and other energy-efficient lighting market.
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“The automotive lighting segment is expected to grow at the highest CAGR during the forecast period”
In terms of application, the market for automotive lighting is expected to grow at the highest rate during the forecast period. Solid-state and other energy-efficient lighting technology is providing benefits such as high efficiency and long battery life to automotive manufacturers. Owing to these benefits, the automotive sector is largely adopting this technology for use in vehicles.
“APAC expected to account for the largest market share during the forecast period”
APAC is expected to hold the largest size of the solid-state and other energy-efficient lighting market during the forecast period. The increasing adoption of solid-state and other energy-efficient lighting in indoor and outdoor lighting in developing countries such as India and China is driving the growth of the market in APAC. Also, the increased construction activities in APAC are contributing to the growth of the market in the region
Driver: Greater Energy Savings Compared to Other Forms of Lighting
LEDs consume 50% and 85% lesser electricity than fluorescent lamps and incandescent lights, respectively. The long life of LEDs makes them the best lighting solution for museums and libraries. The impact of this driver is high since end users are inclined toward lighting devices and technologies with low energy consumption. The impact is expected to remain high for the next couple of years and will be one of the major factors for the lighting industry in terms of energy consumption. It is worth comparing the traditional tungsten incandescent light performance with new LED technology to look at energy reduction and savings potential by moving to LED lighting or solid-state lighting. The table below depicts the total cost of energy use. It includes the cost of replacing burned-out lights. Incandescent 100W light bulbs are already not in use in some countries and will soon be phased out in others.
Restraint: High Implementation and Equipment Cost
Though solid-state and other energy-efficient lighting is able to save costs in the long run, the initial cost of implementation and equipment is very high. LED lamps are approximately 20 times costlier than conventional incandescent lamps. However, the mass production of LED lamps and evolving lighting technologies are expected to reduce price and increase their demand in the future. The impact of this restraint is high across different end users. However, in the coming years, the impact is expected to be quite low.
Opportunity: Growing Adoption of LEDs in the Automotive Industry
The automotive lighting market has undergone a tremendous change in the last five years as many innovative and adaptive technologies penetrated the market. LEDs, which were first used as ambient lighting in car interiors and in indicator light applications, have become versatile backlight displays and headlamps. Similar to the evolution of microcontrollers, LEDs are being sold in module format in combination with a variety of widely used peripherals. LEDs have an adaptable design and are more energy efficient than most lighting technologies. The cost of LEDs is expected to drop in the next three years with the increase in engineering capabilities and technological advances. LEDs are expected to have the capability to replace all other types of automotive lamps. LEDs are already used in exterior lights (front and rear), brake lights, daytime running lamps (DRLs), and indicators. They are also used in ambient lighting and dashboard and instrument lighting.
Challenge: Rapidly Rising Testing Cost
With the increasing number of products and product variations entering the market, rapidly rising testing cost has become an important issue for manufacturers. While per-product testing plays a critical role in early product quality and buyers’ confidence in LED technology, it is becoming a hindrance to product line expansion. To meet the needs of the lighting market, testing costs will have to decrease to allow faster and more efficient lighting product line development.
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