Lighting as a Service

Lighting as a Service

Global Lighting as a Service Market to Reach US$31.6 Billion by 2030

The global market for Lighting as a Service estimated at US$3.0 Billion in the year 2023, is expected to reach US$31.6 Billion by 2030, growing at a CAGR of 39.9% over the analysis period 2023-2030. Software Component, one of the segments analyzed in the report, is expected to record a 39.4% CAGR and reach US$12.8 Billion by the end of the analysis period. Growth in the Luminaries & Controls Component segment is estimated at 43.2% CAGR over the analysis period.

The U.S. Market is Estimated at US$900.8 Million While China is Forecast to Grow at 37.2% CAGR

The Lighting as a Service market in the U.S. is estimated at US$900.8 Million in the year 2023. China, the world`s second largest economy, is forecast to reach a projected market size of US$4.2 Billion by the year 2030 trailing a CAGR of 37.2% over the analysis period 2023-2030. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at a CAGR of 35.5% and 33.3% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 26.4% CAGR.

Global Lighting as a Service (LaaS) Market - Key Trends & Drivers Summarized

Why Is Lighting as a Service (LaaS) Gaining Traction in the Market?

Lighting as a Service (LaaS) is an innovative business model that offers lighting solutions through a subscription-based service rather than a traditional purchase. This model is gaining traction in the market due to its potential to reduce upfront costs, improve energy efficiency, and simplify maintenance for businesses and municipalities. Under LaaS agreements, service providers install, maintain, and upgrade lighting systems, while customers pay a recurring fee for the use of the lighting service. The appeal of LaaS lies in its ability to offer state-of-the-art lighting solutions without the need for significant capital investment, making it particularly attractive to companies looking to upgrade their lighting systems to more energy-efficient options. As sustainability becomes a higher priority for businesses and governments, LaaS is emerging as a viable and cost-effective solution for reducing energy consumption and carbon emissions.

How Are Technological Innovations Driving the Adoption of LaaS?

Technological innovations are at the heart of the growing adoption of LaaS, as advancements in LED lighting, smart lighting systems, and IoT (Internet of Things) integration are making these services more attractive to customers. The transition from traditional lighting to LED technology is a key driver, as LEDs offer significant energy savings, longer lifespans, and lower maintenance costs. The integration of smart lighting controls and sensors within LaaS solutions allows for automated lighting adjustments based on occupancy, daylight levels, and energy usage, further enhancing efficiency and cost savings. Additionally, the use of IoT platforms enables real-time monitoring and management of lighting systems, providing service providers with the data needed to optimize performance and proactively address maintenance issues. These technological advancements are making LaaS an increasingly attractive option for businesses and municipalities looking to modernize their lighting infrastructure.

What Market Trends Are Shaping the Demand for LaaS?

The demand for LaaS is being shaped by several key market trends, including the growing focus on energy efficiency, the push for sustainability, and the shift towards service-based business models. As energy costs continue to rise and environmental regulations become more stringent, businesses are seeking ways to reduce their energy consumption and carbon footprint, making LaaS an appealing solution. The trend towards outsourcing non-core business functions is also contributing to the growth of LaaS, as companies look to streamline operations and focus on their primary activities. Additionally, the increasing adoption of smart building technologies is driving demand for LaaS, as integrated lighting systems that can be controlled and optimized remotely are becoming more desirable. The rise of circular economy principles, where resources are used more efficiently and products are kept in use for longer, is further supporting the growth of LaaS, as it aligns with the goals of reducing waste and maximizing the lifespan of lighting systems.

What Is Driving the Growth in the Lighting as a Service Market?

The growth in the Lighting as a Service (LaaS) market is driven by several factors. The increasing focus on energy efficiency and the need to comply with environmental regulations are major drivers, as businesses and municipalities seek to reduce energy consumption and carbon emissions. Technological advancements in LED lighting, smart controls, and IoT integration are making LaaS solutions more attractive and cost-effective, further driving adoption. The shift towards service-based business models, where customers pay for the use of a service rather than owning the product, is also contributing to the growth of LaaS, as it offers a flexible and scalable solution for modernizing lighting infrastructure. Additionally, the trend towards sustainability and the circular economy is supporting the market, as LaaS aligns with the principles of reducing waste and maximizing resource efficiency. The expansion of LaaS into new markets, including emerging economies where energy efficiency is a growing concern, is creating new opportunities for service providers and driving market growth.

Select Competitors (Total 42 Featured) -

• Cree, Inc.
• Future Energy Solutions
• GE Lighting
• Igor Inc.
• Italtel SpA
• Koninklijke Philips NV
• Lunera Lighting, Inc.
• Rcg Lighthouse
• SIB Lighting
• Zumtobel Group AG

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