New lighting market report release by McKinsey

Based on a worldwide survey of lighting professionals and consumers, as well as other input factors, McKinsey has developed a lighting market model that estimates the size of the global lighting market through to 2020, differentiated by application, geography, and light-source technology. The lighting market has been receiving much attention lately due to its high potential for CO₂abatement and its many new entrants. However, no comprehensive report exists providing a holistic view across all the key sectors and applications, geographies, light-source technologies and different stages of the value chain.

To close this gap, McKinsey & Company was commissioned by Osram to draw up a market report with an independent perspective on the global lighting market and its likely evolution.

The McKinsey report’s authors will present their findings in a presentation entitled “Lighting the Way: Perspectives on LEDs and the Global Lighting Market” during the Keynote Session at this year’s Strategies in Light Europe in Milan, Italy.

In order to develop a holistic overview of the global lighting market, including an estimate of LED market share going forward, McKinsey conducted a worldwide survey of lighting professionals as well as consumers from seven different countries (the US, Germany, Japan, China, Russia, Brazil, and India).

Based on this survey as well as other input factors, McKinsey developed a lighting market model estimating the size of the global lighting market through to 2020, differentiated by application, geography, and light-source technology.

Projections show that the global lighting market is expected to have revenues of approxi¬mately EUR 110 billion in 2020 – comparable to the global TV market. A number of megatrends underlie this expansion. Global population growth and urbanization are increasing the overall demand for lighting products. Resource scar¬city and climate change concerns are driving the industry trend towards more energy-effi¬cient lighting technologies. This is being accelerated by government regulation on energy efficiency around the globe.

The advent of LED technology – only the fourth lighting technology in the history of human mankind – is set to transform this industry. LED technology has not achieved a com¬petitive cost position in most applications up to now. But heavy investment from various companies is forecasted to cut costs at a rate of 30 percent per annum, and LED is becoming a broadly affordable technology.

Figures suggest that estimated global revenues from the LED lighting market will grow at 30% per annum, amounting to almost EUR 65 billion by 2020 – close to 60 percent of the overall lighting market.

The three most relevant sectors in lighting are general lighting, automotive light¬ing, and backlighting. This market report covers these 3 major sectors with a deep dive in general lighting: this is the largest sector, accounting for approximately 75 percent of the total lighting market.

McKinsey Report – Lighting the Way

LEDs may have reached “tipping point” with electrical contractors

A survey of 700 readers of Electrical Contractor magazine showed a majority of contractors believe LEDs are either now ready to replace incandescent and fluorescent lamps or will be ready by the Fall of 2012.

Electrical contractors may be reaching the point where specification and installation of LED lighting, where appropriate, is becoming the rule and not the exception.   Results of a survey of 700 readers of Electrical Contractor magazine indicate a majority of electrical contractors believe LED lamps are now ready or will be ready within a year to replace incandescent and fluorescent lamps.   The publisher of Electrical Contractor, John Maisel, said, “The more we educate [electrical contractors] on the technology and opportunities in the multibillion dollar LED market that’s growing more than 30 percent per year, the greater value they bring to their customers.” Electrical Contractor, which reaches over 85,000 electrical contractors in the US, is published by the National Electrical Contractors Association (NECA) in Bethesda, MD.   Among those readers who responded to the survey, 33 percent of electrical contractors said LEDs are ready to replace incandescent lamps, compared with 23 percent saying LEDs are ready to replace CFLs and 19 percent claiming LEDs are ready to replace fluorescent lamps (see figure).   Market readiness for LED replacement An additional 33 percent of electrical contractors believe LEDs will be ready to replace these traditional lamp sources within the next two years. The remaining respondents see LEDs becoming more viable later, or they “don’t know” when viability will occur. Of those who said LEDs were not ready or they didn’t know, 19 percent said that high cost was a factor, while 10 percent mentioned needed improvements in performance.   The survey was conducted by the firm Renaissance Research & Consulting (New York, NY) in the Fall of 2010. Participants included contractors working on residential projects, commercial/industrial/institutional (CII) projects and non-building projects (see figure).   Lighting work performed by construction type (Res, CII, NB) All things to all people?Lighting is an inherent part of the electrical contractor’s job. As such, it comes as little surprise that 97 percent of respondents indicated they work with indoor or outdoor fixtures (on a combined basis), while 95 percent perform work with lamps, 93 percent with ballasts and 85 percent with controls.   A substantial portion, between 45 and 60 percent of electrical contractors, perform all functions on the job including buying, specifying and installing lighting products. Ninety percent of contractors perform some lamp work, while about 60 percent work on all aspects, meaning they specify and install lamps.   Regarding lamp types, contractors mentioned fluorescent and compact fluorescent lamps the most, while LEDs actually were mentioned the least. However, the report says “ECs are proportionately more involved in LED specification than with other lamp types.” LEDs on building projects Beyond this recent survey, Electrical Contractor featured a special supplement entitled The LED Revolution, with its July issue. With articles addressing initial cost and payback, dimming and required drivers, compatibility with controls and LED standards, the issue provides a useful overview to contractors and distributors.   Out of the readership survey came important tips for electrical contractors. For instance, contractors should specify LED luminaires with well-designed optics to ensure the light reaches the intended surfaces. Controls are considered the largest contributor to improved efficiency through sophisticated addressable ballasts along with daylight and motion sensors.

About the Author

Laura Peters is a Senior Technical Editor with LEDs Magazine. Source: http://www.ledsmagazine.com/news/8/8/16

LED solutions for Mining applications

Worldwide, organisations are looking to implement technology that is environmentally conscious while providing increased efficiencies.  LED technology meets these criteria through its reduced impact on our environment and low cost of ownership.

Within the mining and industrial sectors the dependence on energy hungry HID (high intensity discharge) luminaires has further added urgency to the emergence of an environmentally sustainable alternative.  As late as 2 years ago there was very little choice for companies looking for an alternative, but with LED technology having matured with improvements in efficacy, design, thermal management, and lowered its overall cost, LEDs are now a viable and attractive alternative to traditional lighting technologies.

The following are 4 very good reasons (both financial and environmental) to consider an LED solution for new projects or retrofit into existing infrastructure:

1. Electricity Reduction – high efficacy (typical 80 lm/W, but now up to 95 lm/W) as well as direct, usable light means that applications requiring 400W MH (metal halide) can be replaced with as low as a 150W LED, effectively reducing electricity costs by >50%.

LED luminaires are also controllable and without re-strike times, and due to their instant on/off & dimmable capabilities are ideally suited to photo sensors and motion sensors.  Light is there when required, otherwise it is off, further conserving electricity.

In addition low inrush and operating currents mean reduced peak rates and start-up demands. A 150W LED will start up at 0.5 A, and run at 0.5 A.  Compared to an MH with a start-up of 15 A, and running current of 3 A.

This reduction in electricity usage corresponds directly to a reduction in C02-e generation.  With lighting typically being a large component of overall electricity use, a >50% reduction to C02-e emissions in this area is significant.

2. Maintenance & Replacement Savings -  many luminaires in the mining and industrial sector are critical to safe operation and are often in challenging environments.  This fact requires a diligent maintenance schedule and quick changes of non-functioning lamps, often requiring equipment (scissor lifts, scaffold) and electricians.

Current HID technology is susceptible to damage due to the presence of filaments, and bulbs, and typically has a maximum lifespan of 15,000 hours.  LED lamps are extremely durable, vibration resistant, and have lifespans in excess of 50,000 hours (L70), effectively halving maintenance and replacement costs.

As a further benefit to the environment, LED lamps do not contain any mercury (Hg), and are fully recyclable.  Traditional HIDs can contain up to 80 mg of Hg per lamp, the cost of which is ~$350 per kilo (of lamp) to dispose of properly.

 LED Solution Snapshot

*Calculations based on 24/7 runtime and QLD emissions factor of 0.89 kg CO₂-e/kWh.

 

3. Increased Safety – another inherent benefit of employing an LED solution is increased safety for employees.   Metal halide technology requires specialised UV filters to ensure that employees are protected from unwanted exposure.  If these filters become cracked or damaged employees can unwittingly be exposed to dangerous amounts of UV radiation.  LED lamps do not generate any UV, and do not require filters.

Should a metal halide HID be damaged or fail catastrophically employees in the immediate area may be subject to vaporised Hg, as well as hot glass and metal.  LED lamps do not fail in this manner and as mentioned, do not contain mercury.

4. Reduction of Light Pollution – considering the amount of light required and generated by mining operations, light bleed for surrounding communities and wildlife is a concern.

The direct nature of LED light, instant on/off capabilities and customisable beam angles limits unwanted light bleed.  Where required LED luminaires can also be customised to limit impact on sensitive wildlife.

For instance, LED lights in the higher wave spectrums (590nm) are being used with EPA approval in areas where there are nesting Sea Turtle populations.

With benefits extending across finance, safety and the environment more and more organisations are making a concerted effort to retrofit or specify LED technology.

Kevin Day

Kevin Day is the CEO of LED Light Works, an Australian company providing high quality LED technology to the worldwide market.  www.ledlightworks.com.au