As cities and municipalities update infrastructure and street lighting systems, the smart lighting market will grow significantly in coming years. The market is expected to reach $22 billion by 2025, up from $7.93 billion in 2018 — a CAGR of 20% — according to new research from Reports & Data. Another newly released report, from MarketDigits, expects similar growth, saying the commercial lighting market will reach $21.8 billion by 2025.
Modernization and development of infrastructure to transform cities into smart cities, along with increased demand for intelligent solutions for street lighting systems, are the major factors driving the growth of the market. Other factors driving the growth include the need for energy-efficient lighting systems, increasing adoption and decreasing cost of LEDs, the surging use of integrated lighting control systems, and growing awareness about energy savings among consumers and governments worldwide.
However, hampering adoption of smart lighting control systems is the fact that the initial cost is high. Smart lighting is comprised of hardware components such as dimmers, switches, sensors, control systems, and software. Hence, the installation cost of smart lighting is higher than that of conventional lightings. This is primarily due to the requirement for highly expensive software, control systems, and LED light sources for smart lighting solutions.
Challenges for Developers
To meet demand, smart lighting technology developers will face significant challenges, including:
—A huge investment requirement in infrastructure, equipment, and process development;
—The need to develop different manufacturing processes as well as equipment compatibility;
—Lack of universal open standards for aiding communication between all IoT devices.
Players will require increased investments to tackle these challenges and facilitate growth in the coming years, according to the Reports & Data report. Meanwhile, rapid transition from traditional lighting to connected lighting solutions and increased adoption of PoE-based and solar lighting system are major opportunities for the commercial lighting market, the MarketDigits report says.
The outbreak of Covid-19 significantly impacted the lighting industry owing to the lockdown across many countries and disruptions in the supply chain. Thus, most of the lighting OEMs and integrators are witnessing a shortage of electronic components such as chips and LED drivers, MarketDigits writes. This has created an imbalance, resulting in a demand-supply gap and an increase in the prices of lighting products. For instance, Signify has announced a temporary price hike on all LED and lamp electronics as the costs in its logistics chain is on the rise due to the pandemic. Disruption in the supply chain would create an imbalance in the demand-supply equation and create pressure across entities in the smart lighting ecosystem.
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January 19, 2021 at 04:17AM
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Rapid Growth in Smart Lighting Market Driven by Smart Cities and Infrastructure Upgrades, Reports Say - Environment + Energy Leader
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