Indoor LED Lighting Market SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2030

Global Indoor LED Lighting Market Trends

The market is driven by increasing population, green buildings, and government programs to promote LED adoption

• The world's population reached 8 billion people in 2023, up from 7.79 billion in 2020. The largest countries by population included China (1.45 billion), India (1.42 billion), and the US (336.8 million). Furthermore, global employment increased to 3.32 billion people in 2022 from 3.16 billion in 2015, an increase of almost 0.13 billion people. The use of LEDs will increase as more knowledge is spread throughout the population as a result of the rise in the number of employed individuals and population growth.
• Despite the COVID-19 pandemic, worldwide spending on energy-efficient construction increased by an exceptional 11.4% in 2020 to over USD 184 billion, up from USD 165 billion in 2019. The yearly growth rate for investments in energy efficiency surpassed 3% for the first time since 2015. The requirement for additional rooms in a house will result in increased demand for LEDs due to the rise in the development of energy-efficient buildings and to meet the residential needs of the expanding population.
• Globally, launches of new houses have been rising, creating more LED penetration due to the need for illumination. For instance, in India, new launches in the Mumbai Metropolitan Region (MMR) increased over two-fold to 1,24,652 units in 2022 from 56,883 units in the previous year. Brazil’s affordable housing program also restarted. The Brazilian President announced plans to restart the nationwide federal housing program for low-income individuals in February 2023. The President created the program, named “Minha Casa, Minha Vida,” which translates to “My Home, My Life,” in 2009. Such instances are further expected to raise the demand for LED lighting in the country.

Development of smart cities, green buildings, and government initiatives to drive the growth of the market

• The development of smart cities and homes is being supported by governments in North America, which are also adopting new technology in the residential and commercial sectors. As an illustration, green buildings in the US increased dramatically in 2021 and now exceed USD 83 billion dollars. This demonstrates the expansion of the green building sector, which is crucial for lowering the carbon footprint of the building and real estate industries. As LED is energy efficient, increased construction activity and the adoption of green building practices will encourage its use. As a result, the LED market in the area is expanding.
• Commercial electricity use lasts between 10 and 12 hours every day. Electricity consumption in the industrial sector accounts for 24 hours a day, while in the residential sector, it varies from 5.5 to 7 hours. The demand for energy-efficient lighting solutions is expected to rise in Asia-Pacific, in part because of government initiatives like India's UJALA and SLNP programs, which offer LEDs at reduced prices and LED installation projects for streetlights, respectively, and promote their use in a variety of industries.
• After governments began taking part in and supporting beneficial efforts, the growing need for energy-efficient lighting systems was mainly realized. Numerous governments all over the world are moving swiftly to phase out inefficient light sources through a variety of efforts like performance requirements, labeling, and incentive schemes. For instance, the EU modified requirements under the Ecodesign Directive and the Restriction of Hazardous Substances Directive, which essentially prohibited all fluorescent lighting in 2023 in Europe, where the transition to LED began more than ten years ago.

OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT

Segment Analysis: Indoor Lighting

Industrial and Warehouse Segment in Indoor LED Lighting Market

The Industrial and Warehouse segment dominates the indoor LED lighting market, commanding approximately 49% of the market share in 2024. This significant market position is driven by the rapid expansion of manufacturing facilities and warehouses globally, particularly in the Asia-Pacific region, which accounts for about 60% of the segment's revenue. The segment's growth is further supported by increasing investments in smart manufacturing facilities and automated warehouses. For instance, India's manufacturing sector is positioning itself as a global manufacturing hub, with its capacity expected to reach USD 1 trillion by 2030. Additionally, the automotive industry's transition to electric vehicle production has created substantial demand for new manufacturing facilities requiring advanced LED lighting solutions.

Agricultural Lighting Segment in Indoor LED Lighting Market

The Agricultural Lighting segment is emerging as the fastest-growing segment in the indoor LED lighting market, with a projected growth rate of approximately 9% from 2024 to 2029. This remarkable growth is primarily driven by the increasing adoption of vertical farming systems and controlled environment agriculture. The segment's expansion is particularly notable in Asia-Pacific countries, where significant investments are being made in innovative farming technologies. For example, the United Arab Emirates has established the world's largest vertical hydroponic farm, capable of producing over 1,000 tons of leafy greens. The Netherlands, as one of the leading producers of greenhouse vegetables, with around 80% of its vegetable production in greenhouses, continues to drive the demand for agricultural LED lighting solutions.

Remaining Segments in Indoor Lighting

The Commercial and Residential segments complete the indoor lighting market landscape, each serving distinct lighting needs. The commercial LED lighting market, encompassing office spaces, retail establishments, and other commercial facilities, is experiencing transformation through the adoption of smart lighting solutions and energy-efficient systems. The retail sector particularly benefits from specialized lighting solutions that enhance product displays and customer experience. The Residential segment, while more traditional in its applications, is seeing increased adoption of smart home lighting systems and energy-efficient solutions, driven by growing awareness of sustainability and energy conservation among homeowners. The built-in lighting market also plays a role in these advancements, offering integrated solutions that align with modern architectural designs.

Indoor LED Lighting Market Geography Segment Analysis

Indoor LED Lighting Market in China

China continues to dominate the global indoor LED lighting market, accounting for approximately 35% of the market share in 2024. The country's manufacturing sector has shown remarkable resilience, with industrial production increasing by 3.9% year-on-year in early 2023. The TMT (Technology, Media, and Telecom) footprint in Beijing's premium office market share has expanded significantly, rising from 15% to 21% in recent years, driving demand for advanced lighting solutions. The government's commitment to energy efficiency through standards like GB 30255-2013 and its replacement GBP 30255-2019 has created a robust framework for LED adoption. The country's focus on developing smart cities and sustainable infrastructure has further accelerated the integration of indoor architectural lighting systems across commercial, industrial, and residential sectors. Additionally, China's massive construction pipeline and urbanization initiatives continue to create substantial opportunities for LED lighting implementations, particularly in new commercial and residential developments.

Indoor LED Lighting Market in India

India's indoor LED lighting market is projected to grow at approximately 15% annually from 2024 to 2029, emerging as the fastest-growing market globally. The country's ambitious manufacturing vision, aiming to become a global manufacturing hub with a capacity increase to USD 1 trillion by 2030, is driving substantial demand for industrial LED lighting solutions. The government's proactive approach through initiatives like the production-linked incentive (PLI) scheme for LED lights, with a budgetary outlay of INR 6238 crore, has created a strong foundation for market expansion. The Bureau of Energy Efficiency (BEE) labeling program and Compulsory Registration Order (CRO) have established stringent quality standards, ensuring the market's sustainable growth. The rapid expansion of commercial infrastructure, coupled with increasing awareness about energy efficiency, has accelerated LED adoption across various sectors. The country's focus on smart city development and green building initiatives has further catalyzed market growth, particularly in the commercial and institutional segments.

Indoor LED Lighting Market in United States

The United States maintains its position as a key market for indoor LED lighting, driven by robust commercial and industrial development. The country's retail sector has undergone significant transformation, with approximately 53% of shoppers increasingly adopting hybrid shopping experiences that combine online and in-store visits. The Department of Energy's stringent efficiency standards, requiring a minimum efficacy standard of 45 lm/W for General Service Lamps, have accelerated the transition to LED lighting. The commercial real estate sector's evolution, particularly in Class A office spaces, has created substantial demand for advanced lighting solutions. The country's focus on energy-efficient construction, evidenced by the significant increase in green building investments, has further strengthened the market. Additionally, the expansion of data centers, warehouses, and industrial facilities has created new opportunities for LED lighting implementations, particularly in high-bay and specialized lighting applications.

Indoor LED Lighting Market in Germany

Germany's indoor LED lighting market continues to demonstrate strong fundamentals, supported by comprehensive regulatory frameworks and sustainability initiatives. The country's commitment to energy efficiency through programs like the National Action Plan on Energy Efficiency (NAPE) has created a structured approach to LED adoption. The Federal Office for Economic Affairs and Export Control's announcement of funding for efficient lighting technology, providing grants up to 20% of investment amounts, has stimulated market growth. The country's robust industrial sector, combined with its leadership in automotive manufacturing and technological innovation, has created sustained demand for advanced lighting solutions. The implementation of EnEV (Energy Conservation Regulations) and DIN V 18599 standards has established clear guidelines for energy consumption in buildings, further driving LED adoption. The focus on modernizing existing infrastructure and developing energy-efficient buildings has created a steady pipeline of projects requiring LED lighting solutions.

Indoor LED Lighting Market in Other Countries

The indoor LED lighting market shows diverse trends across other significant countries including France, Japan, Brazil, and South Korea. These markets are characterized by varying levels of technological adoption and regulatory frameworks supporting LED implementation. European countries like France demonstrate a strong emphasis on energy efficiency and sustainable building practices, while Asian markets like Japan and South Korea focus on technological innovation and smart lighting solutions. Emerging markets in South America, particularly Brazil, show increasing adoption rates driven by urbanization and infrastructure development. Middle Eastern countries are rapidly advancing their LED adoption through government initiatives and sustainable development goals. The regulatory landscape across these markets continues to evolve, with most countries implementing stricter energy efficiency standards and offering incentives for LED adoption. The commercial and industrial sectors remain key drivers of growth across these markets, with an increasing focus on smart building solutions and energy management systems.

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