At lighting trade shows such as Lightfair, there always seems to be a buzz on everyone’s lips. One year, it was light and health. Another, networked controls. Then internet of things. And always LED, LED, LED.

But 2023 felt different. The main narrative among Lightfair attendees seemed to be that this trade show wasn’t as strong as it had been before the pandemic. In an energetic industry that had grown accustomed to barely keeping up with all the change, it was sobering—though it probably felt familiar to the lighting veterans who remember the old days when progress was measured in smaller steps.

LED is king

For many years, the LED dominated new product development, achieving the first milestone of matching traditional source performance to next reach for new design approaches. The technology matured in performance and cost; the LED package that was once the highest cost in the lighting system is now among its lowest.

For all its exciting new capabilities, efficacy remained the primary driver. LEDs came to dominate utility lighting rebate program offerings and became a staple for commercial building energy code compliance. In the residential market, the Biden administration’s elimination of exemptions and enforcement of the backstop provision in the Energy Independence and Security Act of 2007 positioned LEDs to gobble up the majority of remaining general-service lamp sockets.

Various regional studies show significant conversion of the installed lighting stock to LED, particularly in regions with higher energy costs. For example, rebate program evaluation reports by utility consulting firm DNV projected market share ranging from 83% to 94% for LEDs in the linear ambient lighting market in Connecticut, Massachusetts, New Jersey and Rhode Island. Meanwhile, calls for elimination of mercury—resulting in seven states targeting mercury-containing lamps such as fluorescent—signal that not even this venerable lighting technology is safe.

In one sense, this is great news. According to the Department of Energy (DOE), LED lighting has reduced overall demand for electricity in the United States by about 5%. What used to eat 40% of an average commercial building’s budget has fallen to closer to 10%. Compared to yesteryear’s lighting systems, modern lighting now offers a veritable menu of energy efficiency, longevity, precision, aesthetics, flexibility, controllability, data and overall greater value. Fully realized, an LED lighting system today is far more of a building asset than simply another basic cost-bearing utility.

For some, however, it may feel like the party’s over with the low-hanging fruit largely plucked. Rebate programs evaluating LED saturation may eventually conclude that business-as-usual prescriptive rebates are no longer productive in achieving energy savings targets. Energy Star is sunsetting its residential listing for many LED products. The DOE isn’t as energetic about supporting market transformation as it once was.

What’s next?

I may be a realist with expectations, but I’m an optimist when it comes to outlook. I believe the LED revolution isn’t so much over as getting ready for Revolution 2.0. It may not be a major technological shift this time, but it will be focused on market opportunity. In one sense, this revolution may be even more exciting, as it enables U.S. lighting to achieve the technology’s full potential.

Lighting controls and upgrades from first- to second-generation LEDs offer significant energy savings. Utility rebate programs may transition to stronger support of advanced lighting controls and upgrading older LED lighting. Many older systems are first-generation technology, basic TLED lamp retrofits or lacking lighting controls. Upgrading to second-generation LEDs with advanced controls can deliver significant energy savings and other value. In particular, networked lighting controls (which can reduce lighting energy consumption by nearly half), luminaire-level lighting controls, tunable lighting and integration with other building systems such as HVAC and plug loads may receive a boost.

An increasing policy focus on decarbonization may lead to premium lighting and control systems becoming far more attractive. At the national level, electrifying transportation will impose more demand for electric power. At the local level, requirements for reporting carbon emissions and either offsetting or paying financial penalties for exceeding carbon caps will further incentivize energy efficiency and building data. 

Among leading commercial properties, there is a sentiment that minimizing energy costs and the carbon footprint can generate significant value in attracting and retaining high-quality tenants. Meanwhile, energy codes may evolve to become more focused on carbon savings or performance. 

As this metatrend develops, the most robust lighting options may become more attractive when the return on investment calculation includes all associated costs and incorporates applicable value beyond a direct ROI.

The above does not count market segments that are energetic and may see significant opportunities, such as horticultural, germicidal UV and circadian lighting. And of course, ongoing incremental progress—performance, quality, serviceability, etc.—over time adds up to real change.

Overall, the LED revolution may have won, but market conditions may be setting the stage for its next exciting phase.

stock.adobe.com / magraphics