Lighting as a Service Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

The Lighting as a Service Market is Segmented by End-Users (Commercial, Outdoor, and Industrial), and Geography (North America, Europe, Asia-Pacific, South America, and Middle-East and Africa)

Lighting as a Service Industry Overview

Lighting-as-a-Service Market Forecast
Study Period: 2019 - 2028
Fastest Growing Market: North America
Largest Market: Europe
CAGR: 50.04 %

Major Players

Lighting-as-a-Service Market Companies

*Disclaimer: Major Players sorted in no particular order

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Lighting as a Service Market Analysis

The lighting as a service market is expected to grow at a CAGR of approximately 50.4% during the forecast period of 2020-2025. The primary driver for the market includes the increasing demand for efficient lighting systems. The growing convergence of the Internet of Things (IoT) in the lighting system has a lower consumption of energy across various parts of the world. However, the service's subscription program typically imposes a higher overall cost than the owner pays for the self-installation system, which can likely pose a challenge.

  • Lighting-as-a-Service (LaaS), also known as Light-as-a-Service, is a service-based business model in which light service is charged on a subscription basis rather than via a one-time payment. It is managed by third parties more precisely by specialized service providers and may include light design, financing, installation, maintenance, and other services. The LaaS model has become more common in commercial and citywide installations of LED lights, specifically in retrofitting buildings and outdoor facilities, with the prior aim of reducing installation costs. Light vendors have used the LaaS strategy in selling value-added services, such as Internet-connected lighting and energy management.
  • For instance, global LED use has increased substantially in recent years, rising from a market share of 5% in 2013 to nearly half of global lighting sales in 2019, with integrated LED luminaires making up an increasing share. Several developed markets, including the United States and Europe, are responsible for the rapid expansion of the luminaire market segment. At the same time, China has built a substantive domestic and global manufacturing base.
  • Moreover, lighting accounts for nearly 10% of electricity usage in households and 18-40% of commercial premises. There is a growing need for energy saving across the globe, creating scope for the market. It is expected that the transition to energy-efficient lighting would reduce the global electricity demand for lighting by 30-40% in 2030. Using 50+% less energy consumption, LED lights to produce brighter, clearer light without the flicker that often irritates the optic nerve leading to employee complaints about headaches and fatigue. Additionally, LED lights contain NO hazardous materials, don't flicker or strobe, and are completely recyclable.
  • Countries across the world are widely adopting LED lighting. For instance, New York planned to replace 250,000 streetlights with LEDs, which was to be followed by the replacement of decorative lights in the urban areas. Barcelona (Spain) deployed more than 3,000 smart streetlights based on LED technology, gathering information about pollution, humidity, noise, and the overall environment. Moreover, the US Department of Energy (DOE) anticipates that, by 2020, more than 75% of the outdoor luminaire shipments will be light-emitting diodes (LEDs).
  • Additionally, with the continuing spread of COVID-19, technology vendors across the smart building sector are launching new propositions to help firms improve their buildings' infection control. In March 2020, lighting services firm Eco Energy Group (Eco E) launched a new suite of lighting products to help firms improve infection control in buildings. It launched the 'Smart UVC Solution' ultraviolet (UV) light, which can kill bacteria and viruses on surfaces. The 'Smart UVA Solution' can also disinfect surfaces through safe lighting rays. Eco E will deliver these solutions through a lighting-as-a-service business model that requires no capital expenditure.

Lighting as a Service Industry Segments

The lighting-as-a-service market studies the business model where the customer does not buy its lighting equipment. Rather it enters a multilayer contract that stipulates a flat fee for the lighting needs. The lighting player provides the lamps, luminaries, and controls and, in some cases, can also offer additional services, such as data analysis and financing arrangements. Separate installation companies install the lighting system and receive a fee from the lighting company for maintaining that equipment over the life of the contract. The study further covers the market growth by different end-users and their impact on the regions around the world.

End User
Commercial
Outdoor
Industrial
Geography
North America
Europe
Asia-Pacific
Latin America
Middle East & Africa

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Lighting as a Service Market Trends

This section covers the major market trends shaping the Lighting as a Service Market according to our research experts:

Commercial Segment to Dominate the Market

  • The commercial segment includes the space used for commercial activities like office, stores, institutions, hospitals, etc., primarily those spaces that are not residential, industrial, or manufacturing. Compared to other types of Lighting, commercial Lighting tends to have a higher initial cost, longer lifespan, better durability, higher maintenance and service costs, and better energy-saving options. Commercial activity is one of the key tangible barometers to track the health of the economy of a region or a country.
  • With increasing electricity consumption, various commercial spaces adopt Lighting as a Service (LaaS) model, in which the owner pays for the light rather than the equipment that delivers it. The owner buys Lighting on a subscription basis over an agreement that offers LED technology lighting with maintenance service.
  • The energy savings and cost reductions offered by Lighting as a service (LaaS) constitute an attractive offer for commercial end-users because of the growing corporate focus on sustainability and energy efficiency. Overall cost reductions accelerate the widespread adoption of LaaS by numerous commercial organizations. For instance, using LED retrofits in various commercial application cases in the US showed a potential result. For instance, in Building Exterior Lighting, the result reflected a 63% reduction in energy cost.
  • However, COVID-19 has affected the construction of new commercial buildings. For instance, According to the Bank Pekao SA, Of all types of buildings, only commercial buildings, e.g., office buildings, have seen their production fall by 20% year-on-year in Poland. Additionally, with the implementation of work-from-home policies across the globe, it is expected that these instances would hamper the market growth in the shorter run.
Lighting as a Service Market Report

North America to Dominate the Market

  • North America includes 23 countries, with a cumulative GDP of around USD 24.98 trillion in 2019. The major country with significant development in electricity consumption in the region is the United States, which is adopting various plans to increase the efficiency of the lighting system in the country.
  • During 2019, the Trump administration announced its plans to use much more energy-efficient light bulbs to reduce the energy consumption rate and to help in controlling carbon emission that primarily gets generated in the United States from natural gas-powered plants for electricity generation. As per the plan, all light bulbs sold in the United States must be either LED or fluorescent to meet energy standards.
  • Among various projects in the region, Bristol-Myers Squibb in Lawrenceville is one of the prominent efficient lighting projects that include lighting renovation work for office space of 275 thousand square feet. The project used a distributed relay control system and vacancy sensors to harvest daylight in all areas and reduce the space's energy consumption.
  • Apart from the United States, Canada is another prominent country in the region, concentrating on electricity conservation and is implementing various lighting standards and service projects. Thus, with the growing implementation of the service with various standards in the region, it is expected the market in the near future.
  • With a strong footprint across North America and diverse capabilities, including comprehensive multi-site installations, real-time energy monitoring and analytics, and networked light management systems, it is possible to penetrate the multi-billion lighting market. For instance, Canadian cities are continually promoting smart LED lights to increase energy efficiency, thus encouraging market growth.
Lighting as a Service Market Analysis

Lighting as a Service Market Competitor Analysis

The lighting as a service market is fragmented. The key players in the market include Every Watt Matters, Lumenix, Stouch Lighting, LEDVANCE GmbH, Signify Holdings, and ESB Light Manufacture of LED Luminaires among others. The players leverage the market growth by enhancing their product line driven by efficiency, ease of use, and technological advancements. Moreover, various government implementation is further leading to more adoption of LED lighting, which is catering to the market growth of lighting as a service

  • August 2020 - LEDVANCE GmbH announced the LEDVANCE and Bosch Smart Home lighting solutions for the smart home. The integration of LEDVANCE Smart+ products into the Bosch Smart Home System makes the application even easier for customers it is a high-quality solution for a safe home without the need for an additional bridge.
  • July 2020 - Enlighted Inc offers its award-winning technology in a new Surface Sensor designed for quick and easy deployments at scale across enterprise portfolios. Enlighted’s latest sensor makes activity-based workspaces, conference rooms, and commercial buildings smarter, safer, more efficient, and improves the occupant experience. The sensor captures data including occupancy detection, temperature, ambient lighting levels and is also equipped with Bluetooth LE capabilities to communicate with other IoT devices and applications.
  • January 2020 - Signify NV extended its LED Toplighting compact range to simplify switch to LED grow lights in the greenhouse. The company introduced a high-efficiency version to reduce running costs or for a high output version for different crops. The solution offered can be connected with GrowWise Control System and consumes 50% less energy.

Lighting as a Service Market Top Players

  1. Every Watt Matters

  2. Lumenix

  3. Stouch Lighting

  4. LEDVANCE GmbH

  5. Signify Holdings

*Disclaimer: Major Players sorted in no particular order

Every Watt Matters, Lumenix, Stouch Lighting, LEDVANCE GmbH, Signify Holdings

Lighting as a Service Market Report - Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Assessment of the COVID-19 Impact on the Industry

    3. 4.3 Recent Trends and Developments

    4. 4.4 Government Policies and Regulations

    5. 4.5 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.5.1 Bargaining Power of Suppliers

      2. 4.5.2 Bargaining Power of Consumers

      3. 4.5.3 Threat of New Entrants

      4. 4.5.4 Threat of Substitute Products and Services

      5. 4.5.5 Intensity of Competitive Rivalry

    6. 4.6 Value Chain / Supply Chain

    7. 4.7 Market Drivers

      1. 4.7.1 Government Policies for the Adoption of Energy-efficient Lighting Systems

      2. 4.7.2 Adoption of IoT with Lighting Systems

    8. 4.8 Market Challenges

      1. 4.8.1 Higher Overall Cost of the Subscription programs and Challenges for the Manufacturers Due to Price Fluctuation in the Near Future

  5. 5. MARKET SEGMENTATION

    1. 5.1 End User

      1. 5.1.1 Commercial

      2. 5.1.2 Outdoor

      3. 5.1.3 Industrial

    2. 5.2 Geography

      1. 5.2.1 North America

      2. 5.2.2 Europe

      3. 5.2.3 Asia-Pacific

      4. 5.2.4 Latin America

      5. 5.2.5 Middle East & Africa

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Company Profiles

      1. 6.1.1 Every Watt Matters

      2. 6.1.2 Lumenix

      3. 6.1.3 Stouch Lighting

      4. 6.1.4 LEDVANCE GmbH

      5. 6.1.5 Signify Holdings

      6. 6.1.6 Electricity Supply Board (ESB) Group

      7. 6.1.7 Enlighted, Inc

      8. 6.1.8 General Electric Company

      9. 6.1.9 LumenServe Inc

      10. 6.1.10 Lighthouse

    2. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

**Subject to Availability
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Lighting as a Service Market Research FAQs

The Lighting as a Service Market is studied from 2019 - 2028.

The Lighting as a Service Market is growing at a CAGR of 50.04% over the next 5 years.

North America is growing at the highest CAGR over 2019 - 2028.

Europe holds highest share in 2021.

Every Watt Matters, Lumenix, Stouch Lighting, LEDVANCE GmbH, Signify Holdings are the major companies operating in Lighting as a Service Market.

Lighting as a Service Industry Reports

In-depth industry statistics and market share insights of the Lighting as a Service sector for 2020, 2021, and 2022. The Lighting as a Service research report provides a comprehensive outlook of the market size and an industry growth forecast for 2023 to 2028. Available to download is a free sample file of the Lighting as a Service report PDF.

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