Article: “LED Street Lighting Market Growth: LEDs Magazine: How large is the street- and area-lighting market?

Vrinda Bandarkar: In 2010, it was a $327-million market, which is not huge, but street lights are sort of a gateway technology. When street lights become feasible, the markets for area lights, parking-lot lights, flood lights, wall packs, billboard lights and other lighting applications become available to LEDs.

What markets are included in that number?

That includes worldwide capital spending on street lights and tunnel lights; plus area lights, which includes parking-lot lights, canopy lights, flood lights and wall packs. This is a worldwide estimate of the market size, primarily made up of the US, Europe and China. Markets in other countries at this time are quite small.

What kind of growth do you expect going forward?

We are looking at a CAGR for unit growth of 28% from 2010 to 2015. However, because LED luminaire pricing will continue to depreciate, the revenue growth will be lower, at around 12% (see Chart). The slowdown in China is reflected in a temporary setback for the market in 2011.

What has been the role of stimulus packages, such as the American Recovery and Reinvestment Act of 2009?

The large installations, such as the one that happened in Anchorage, Alaska, and the one that’s currently happening in Los Angeles, were not implemented because of stimulus money. They happened because the cities wanted to reduce their operating costs – both the energy used and the maintenance cost of the street lights. These cities did use some stimulus funding, but more funding was provided through grants and financing through other channels such as environmental groups.`

LED Street Lighting Market Growth

But there are so many cities trying LEDs and those are potentially going to result in full-scale installations very soon. I think that was the role of the stimulus – it exposed city officials to this energy-efficient technology. Many people tend to get comfortable with the status quo, but when you are given money and asked to do something with it that will result in energy savings, you take advantage of something like solid-state lighting. Then, when everyone sees the results, there is strong motivation to want to implement LED lighting throughout the city or municipality. I don’t think this would have happened otherwise.

And what’s going to determine whether these pilot programs go to full-scale implementation, aside from solid performance from the pilot run?

The biggest hurdle for these cities is raising the capital, especially in this difficult economic environment.

Are there other benefits beyond the savings?

Yes, uniformity of light and fewer dark spots. But beyond those qualities, I don’t think we can underestimate the value of the political point it makes.

In your press release, you say the US market has taken the lead in proving the viability of LED technology for outdoor lighting applications. Can you elaborate?

Yes, the US put an early emphasis on street-lighting quality. Through several programs, such as the Department of Energy’s Municipal Solid State Street Lighting Consortium and the DesignLights Consortium, a great deal of effort was made to educate the consumers – meaning the cities – on LED technology, the energy efficiency it can provide, lumen depreciation, and other issues. 

Where do you see the greatest opportunities in this market?

The biggest opportunity exists where old technology is in place – starting with mercury vapor lamps, to fluorescent and incandescent lamps – these are no-brainer applications right now because they pay for themselves in energy savings alone.

Linear fluorescent tubes are common in many parking lots. The fluorescent tubes need to be changed out every year and a half to two years. With exposure to heat, cold and vibration, these fixtures do not perform to their maximum efficiency. They represent another obvious area.

In area lighting, people are also going after high-pressure sodium lights. LEDs offer superior light quality, directionality and the user can reduce lumens and increase uniformity of light, which is the biggest plus for LEDs.

Where do you see maintenance being the biggest factor?

For tunnel lighting, it’s critical. When a tunnel needs to be shut down or partially shut down due to luminaire change-outs, the effect on traffic is very disruptive.

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Orion Energy Systems’ exterior lighting wins gold at Plant Engineering awards

Fluorescent technology designed to reduce energy consumption, costs by 50 percent in outdoor applications

MANITOWOC, Wis. — March 31, 2010 — Orion Energy Systems Inc. (Nasdaq: OESX) was awarded first place in the lighting category at the Plant Engineering Product of the Year Awards held Monday.

Introduced in 2009, Orion’s exterior lighting uses fluorescent technology to reduce energy consumption and costs by 50 percent when compared to high-intensity discharge lighting traditionally used to illuminate parking lots and other outdoor areas after dark.

In a reader vote by plant managers and other Plant Engineering magazine readers, Orion’s exterior technology was selected over Cooper Lighting’s LED exterior fixture for the gold award. Winners were announced in an awards ceremony during the publication’s annual manufacturing summit in Chicago.

“We’re honored to receive a top award from Plant Engineering magazine for the second year in a row,” said Orion CEO Neal Verfuerth. “The fact that the publication’s readers selected our Apollo® solar light pipe as the Grand Award winner last year and our energy efficient exterior platform this year validates that plant managers recognize Orion as the energy-efficiency technology leader.”

Orion’s Apollo® solar light pipe harvests daylight and directs it to the work area of a facility using no electricity. Readers of Plant Engineering selected the technology for the awards’ highest honor as 2008’s Product of the Year Grand Award.

Coca-Cola Enterprises installed the award-winning exterior technology at its Milwaukee, Wis., facility after technology demonstrations revealed that Orion’s 100-watt exterior fluorescent fixture provided 144 percent more light than the company’s existing 400-watt high-intensity discharge (HID) fixtures and 1,718% more light than competing 111-watt LED fixtures.

Orion’s technology delivered 5 foot-candles, in contrast to the existing HIDs’ 2.05 foot-candles. The competing LED technology actually produced lower light levels at .275 foot-candles. Coca-Cola Enterprises will reduce their energy costs by 66%, or 91,655 kilowatt hours, and reduce their carbon emissions by 60 tons per year using Orion’s new technology.

In another test site at a Mayo Clinic in Jacksonville, Fla., Orion’s 220-watt technology increased light levels 50 percent on average, measuring 17 foot-candles in comparison to 8 foot-candles from the existing 400-watt HID technology, and 5 foot-candles from the competing LED technology.

Some of the other companies experiencing significant energy savings as a result of deploying Orion’s exterior technology include:

U.S. Foodservice, Las Vegas, Nev.

Annual cost savings: 58%

Annual energy savings: 157,568 kilowatt-hours (kWh)

Annual carbon dioxide emissions reduction: 103 tons

Kraft Foods, Granite City, Ill.

Annual cost savings: 52%

Annual energy savings: 157,501 kWh

Annual carbon dioxide emissions reduction: 103 tons

PreFlight Airport Parking, Philadelphia, Pa.

Annual cost savings: 49%

Annual energy savings: 47,511 kWh

Annual carbon dioxide emissions reduction: 31 tons

The energy reductions created by Orion’s exterior technology can have a staggering effect on the environment and the economy.

According to the U.S. Department of Energy, there are more than 20 million parking lot lights nationwide, of which only 4 percent utilize energy-efficient fluorescent technology. As a result, parking lot lights alone consume approximately 22.2 billion kilowatt-hours annually, which could be reduced by half using Orion’s technology.

The reduction would decrease carbon dioxide emission by nearly 7.3 million tons annually — the air-scrubbing equivalent of a 2 million-acre forest, or like removing 1.7 million cars from the road, according to the Environmental Protection Agency. The savings also would equate to saving nearly 1 billion gallons of gas every year

Orion’s technology has been rigorously tested to ensure high performance in all weather conditions, and has earned an Underwriters Laboratories (UL) listing for wet location, meaning the fixture showed no leaks when subjected to rain and snow.

Orion’s exterior technology is constructed of coated, galvanized steel and welded together to create a sealed interior to keep the lamps and ballasts free from moisture, dirt and bugs typically found in other technologies. The fixture features a proprietary, one-piece gasket that keeps unwanted elements from the ballast and lamps.

The lamps are protected by a polycarbonate lens that is impact resistant, reducing the threat of breakage and added maintenance costs to replace the broken lamps.

The fluorescent lamps provide a crisp, bright light that illuminates space more efficiently than the orange-tinted HIDs. And the fluorescent platform does not depreciate as quickly as HID, LED or induction technology, which can depreciate up to 30 percent, compared to Orion’s technology that depreciates only up to 7 percent during its lifetime.

Orion has deployed its energy management systems in 5,374 facilities across North America, including 123 of the Fortune 500 companies. Since 2001, Orion technology has displaced more than 504 megawatts, saving customers more than $782 million and reducing indirect carbon dioxide emissions by 6.7 million tons.

Orion Energy Systems Inc. (Nasdaq: OESX) is a leading power technology enterprise that designs, manufactures and implements energy management systems, consisting primarily of high-performance, energy-efficient lighting platforms, intelligent wireless control systems and direct renewable solar technology for commercial and industrial customers without compromising their operations.