The US LED market was valued at USD 8.82 billion in 2018 and is expected to register a Cagr of 12.6% over the forecast period (2019-2024). Residential LEDs, especially ENERGY STAR rated products, use at least 75% less energy, and last 25 times longer, than incandescent lighting. Widespread use of LED light also has the most significant potential impact on energy savings in the United States.
The high efficiency and directional nature of LEDs make them perfect for multiple industrial uses. LED lights are increasingly being incorporated in parking garage lightway, walkway, street lights, modular lighting, and task lighting among other things.
The LED lighting penetration in terms of cumulative installations is significantly lower compared to its market share of unit shipments. There are two primary reasons for this phenomenon. Firstly, the total number of lighting products installed, i.e. the U.S. inventory of lighting, is significantly larger than the total number shipped each year, since the lifetime of lighting products in several applications exceeds one year.
Secondly, the cumulative installed penetration of LED lighting increases as it replaces conventional lighting technologies. Therefore, when an existing LED product installed is replaced by a newer LED product, either due to failure or lighting upgrade, it results in almost zero net gain to the installed penetration of LED lighting. The importance of this phenomenon increases the longer a technology is available on the market and affects the cumulative installed stock of LED lights.
General Purpose Lighting to Hold Major Share
The alternatives to incandescent light bulbs, which are energy efficient, have been available for a long time. Since the past few years, market conditions have been favoring and LED bulbs are poised for widespread consumer adoption.
Moreover, price decrease, energy savings, and an independent certification for rigorous performance standards are bolstering customer satisfaction. Traditional incandescent light bulbs comprising of 100-40W bulbs have catered to the basic lighting needs in the country for more than a century. However, 90% of the energy used is wasted as heat and only 10% is used to deliver light.
The adoption of LED bulbs has been majorly augmented by the Energy Independence and Security Act (EISA) of 2007 general service lamp standards. The maximum wattage standards, which began to take effect from 2012, requires a 25% efficiency increase for all general service lamps.
The Scope of US LED Market (2019-2024):
The United States LED market is segmented into two categories, indoor and outdoor, based on the type of use. The indoor segment is further subdivided into the residential, commercial, and industrial sector. Based on category type, the market is further segmented into general purpose, integrated fixture/luminaire, linear, and reflector.