LED lighting needs to have a unified standard, said Horng-Ching Hsiao, professor at National Taiwan University of Science and Technology and a member of The Illuminating Engineering Society of Taiwan. Hsiao noted that in recent years, the LED lighting industry has been facing problems such as patent infringements and diverse standards, which has been preventing the industry from expanding.
Hsiao believes LED lighting will dominate the lighting industry as firms continue to improve brightness efficiency and upgrade technologies.
2013: The year for indoor LED lighting
According to Hsiao, the LED industry expects the T5 tube lighting to remains the mainstream of the lighting market before 2020 because it is the most economical light source. But as the product contains mercury, it will eventually be eliminated from the market.
Hsiao believes 2013 will be an important year for the development of LED lighting because the maturity and price-performance ratio have reached a certain level. "2013 can be the year for indoor LED lighting to commercialize," said Hsiao.
The price-performance ratio for incandescent lighting is 600lm/US$1, and for fluorescent lighting it is 800lm/US$1. Hsiao pointed out that for LED lighting to replace traditional lighting, the price-performance ratio needs to exceed 250lm/US$1.
This target is attainable, said Hsiao, as the price-performance ratio in 2012 already reached 170-180lm/US$1. It is likely to see LED lighting with price-performance ratio of 250lm/US$1 in the beginning of third-quarter 2013. Hsiao added that the brightness efficiency of LED lighting is expected to reach above 170lm/W and costs of heat dissipation solutions will come down, and therefore the price-performance ratio in can be improved significantly in 2013.
From the technological roadmaps of international firms, the brightness efficiency of LED chips may reach 180lm/W in second-half 2013, making the cost structure of LED lighting similar to that of traditional lighting, said Hsiao.
Other than brightness efficiency
Hsiao believes indoor LED lighting cannot solely focus on brightness efficiency because customers preference depends on perceptions. Sufficient and even candle power distribution, suitable luminance, no glare, natural color rendering, comfortable color temperatures, and flicker-free are also important features when consumers choose lighting products, said Hsiao.
Energy-saving LED lighting with uncomfortable glare, for example, will be hard for the market to accept, added Hsiao.
The industry needs to improve the luminous flux, increase color rendering above 90, and focus on developing low color temperature products for LED lighting to gain share in the indoor lighting market, Hsiao suggested.
Standardization
According to market research, the percentage of lighting applications in the high-brightness LED market will increase to 52% in 2015 from 24% in 2011. in addition, Asia will continue to be a major market for the lighting industry and become the main LED market before 2015, said Hsiao.
Philips predicts the potential global LED lighting output value will be around EUR85-90 billion (US$110-117 billion) and in particular, the compound annual growth rate (CAGR) of the global LED lighting industry is estimated to be 32% from 2010-2020. By 2020, the global LED lighting market output value is likely to reach EUR55 billion. As LED prices continue to fall and price-performance ratio continues to rise, the prices of LED lighting fixtures in 2015 are forecast to be one-third of the prices in 2010, added Hsiao.
The prospect of the LED lighting market is optimistic but firms in Greater China are still incurring losses. This is because as the brightness efficiency increases, it takes longer for consumers to switch to new products, and hence firms see rising inventory levels, Hsiao explained. Furthermore, firms do not have core technology and have to pay a large amount of royalties every year.
The lack of a unified standard for LED lighting products is the industry's biggest problem, said Hsiao. Different products from different firms lack compatibility and interchangeability causing limited distribution channels.
Currently, the upstream epitaxial wafer segment faces oversupply while downstream firms lack distribution channels in Greater China. The upstream patents have been owned by firms in Europe, US, and Japan. Other firms only have two options, pay royalties or find niche markets by standardize specifications, Hsiao pointed out.
Greater China alliance
Although international makers have begun to standardize product specifications, Taiwan's industry has innovative skills, technologies and competitive costs. All these advantages, combined with the size of the market in China can help Greater China-based firms create a new market and challenge the dominance of international firms, according to Hsiao.
"I believe standardization of specifications can help the industry to grow steadily and lower inventory costs, and because the international community has yet to complete standardization, now is the time for firms in Greater China to develop this area," said Hsiao.
