The lighting as a service market is expected to grow at a CAGR of approximately 52% during the forecast period. The primary driver for the market includes the increasing demand for efficient lighting systems and the growing convergence of the Internet of Things (IoT) in the lighting system to have lower consumption of energy across various parts of the world. However, the subscription program for the service typically imposes a higher overall cost than the owner pays for the self-installation system, which is likely to hinder the market growth during the forecast period.

  • With the significant presence of commercial spaces available all around the world, it is expected that the commercial segment is likely to dominate the market during the forecast period.
  • Lighting as a service primarily uses LED (Light Emitting Diodes) lights to save energy and to reduce the electricity cost of an owner. LED are highly energy-efficient technology, that uses 75% less energy and have almost 25 times longer lifetime than the incandescent lights. It has been estimated that by 2030, the United States, with its technological developments, is planning to conserve more than 350 TWh of electricity, which is estimated to save nearly USD 30 billion. The plan is expected to create an opportunity for the market where the service can provide an efficient lighting system with maintenance service in the near future.
  • With a significant number of energy-saving projects in 2018, North America is estimated to dominate the market during the forecast period.



Key Market Trends

Commercial Segment to Dominate the Market

  • The commercial segment includes the space used for commercial activities like office, stores, etc. Commercial activity is one of the key tangible barometers to track the health of the economy of a region or a country.
  • During 2018, commercial space availed globally consumed nearly 18 quadrillions British Thermal Units (Btu) of electricity. With increasing commercial space over the years, it is likely to get increased to almost 20 quadrillions Btu by the year 2025.
  • With increasing electricity consumption, various commercial spaces are adopting 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.
  • Office projects like Michael Best LLC, a full-service law firm in the United States, has incorporated color temperature tuning lighting technology by Hubbell Lighting. The project includes varying lighting conditions depending upon the space and incoming natural light. It contains integral NX sensors that control the lighting system.
  • Moreover, various real state players are keen to take up the service, which gives them an extra edge to provide better commercial space to its clients and help to save expenses on the name of electricity bills.



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 it s 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 to reduce the energy consumption of the space.
  • Apart from the United States, Canada is another prominent country in the region that is concentrating on electricity conservation and are implementing various lighting standards and service projects. Thus, with the growing implementation of the service with various standards in the region is expected the market in the near future.



Competitive Landscape

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.

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