Any new technology that enters the marketplace usually comes with a very high price tag. That was certainly the case with LEDs when they showed up about a decade ago: LED lamps and luminaires were significantly more expensive than their incandescent, halogen, and fluorescent counterparts, as manufacturers sought to recoup their R&D investments.
Research and Markets’ March 2015 report “United States LED Lighting Market Forecast & Opportunities, 2020” forecasted that the U.S. lighting market would reach $5.2 billion (U.S.) by the end of last year. Then, in their May 2015 report, “World LED Lighting Markets,” the market research and analyst group said, “By late 2014, LED lighting was closing in on 40% penetration of the global lighting market.” That’s a significant market share given that LED overproduction in China has flooded the market and shrunk profit margins for companies dealing in individual LEDs.
In the consumer market, November 2014’s “The Evolving Price of Household LED Lamps: Recent Trends and Historical Comparisons for the US Market” from the Lawrence Berkeley National Laboratory (LBNL), found that since 2011, U.S. sales of LED replacement A-lamps had increased tenfold, while the price had fallen by a factor of two or more. The rapid price decrease is attributed by the LBNL to a couple of things. One is “Haitz’s Law, which is the observation that the per-lumen price of LEDs has fallen by a factor of 10 in each decade since their invention in the 1960s.” The second is the “general observation that new technologies tend to fall in price as their production increases.” Early generations of LED A-Type and PAR replacements lamps, for example had price tags of $75 to $200. Now that range has fallen to between $10 and $100.
But purchase cost is not the only way to evaluate LED lamp and luminaire prices. Willem Sillevis-Smitt, vice president of sales and marketing for Xicato, notes that the operating cost of the fixture over its lifetime is just as important and should be taken into consideration. •
