LEDs turn up the competition in price war against CFLs

The New York Times recently reported that CFL shipments were down by almost 10 percent for the first quarter of 2015 compared with the same period last year, while shipments of LEDs were up by more than 150 percent, according to the National Electrical Manufacturers Association.

So what does this mean?

The demand for CFLs is dwindling, while the demand for LEDs is rising. For years, the cost differential was the only competitive advantage CFLs enjoyed; but now the playing field is leveling. While there are still applications that are better-suited to CFLs as opposed to LEDs, like areas which require high-intensity lighting, manufacturers like General Electric are shifting their focus towards LEDs.

In the past month or so, we’ve seen two relatively inexpensive LED bulbs come to market, thanks to GE and Philips.

The GE Bright Stik, a cylindrical 60-watt bulb, comes in a three-pack available for $9.97. The light bulb is geared toward businesses that typically use CFLs, like hotels, because its slimmer shape lets it fit into existing fixtures that were designed for CFLs.

Philips’ low-priced LED bulb was introduced to the market at $4.97 apiece, with a two-for-one deal for the first 90 days. The bulb is meant to serve as a utilitarian bulb that does not dim and can be used in places like basements, laundry rooms and anywhere that requires a consistent level of lighting.

Phillips Bulb

This is all positive news for the entire LED industry — sapphire manufacturers included. Prices for LEDs have dropped in part because of government regulations, but also because of increased efficiencies when it comes to LED and sapphire manufacturing.

By developing large diameter wafers, manufacturers have been able to maximize the usable area of a sapphire wafer, which effectively maximizes the number of LED chips produced per wafer. Then, through technologies like Patterned Sapphire Substrates, precise etching and patterning can increase the total light extraction efficiency as much as 30 percent.

With prices dropping, LEDs are now becoming a viable option for people’s lighting needs worldwide. From Africa to Asia to North America, LED lighting is helping to break new grounds. As LEDs continue catch on, the LED Revolution we have been discussing on this blog becomes less hypothetical and more a reality.

The Evolution of the Efficiency of the Light Bulb

On January 1, 2014, the classic 60-watt incandescent light bulb was banned in the United States forever.

Along with the U.S., governments across the world have developed and passed measures to phase out incandescent light bulbs in favor of more energy-efficient lighting alternatives. Led originally by Brazil and Venezuela in 2005, these phase-out regulations have effectively banned the manufacturing, importation and sale of incandescent light bulbs for lighting purposes. The regulations will only allow future incandescent bulbs to be sold if they meet specific energy efficiency criteria.

The classic light bulb was abolished in an effort to transition the U.S. to new and more efficient lighting technologies-known as light-emitting diodes (LEDs)-for the benefit of nationwide energy savings.

Following the incandescent bulb ban, compact fluorescent light bulbs and LEDs became the most popular alternatives. CFLs are the size of a standard bulb but have spindly, spiraling fluorescent tubes in place of filament. For their time, fluorescent light bulbs were a big step forward in terms of efficiency; however, nowadays LEDs surpass CFLs across all categories.

The chart below sheds some light on the evolution of the efficiency of the light bulb.

Incandescents vs. CFLs vs. LEDs

Adapted from: http://www.designrecycleinc.com/led comp chart.html

While prices on LED bulbs can vary widely from state to state, most coming to market these days are approximately $10. While this may sound expensive, LEDs make up the difference through energy cost savings and longevity.

As you can see, LEDs can last over six times longer than CFLs-with a calculated life span of 23 years if the bulb is on three hours per day-and the annual operating cost of an LED is less than half of that of a CFL. Since the lighting in our homes accounts for about one-quarter of our electricity bills, LEDs are the best way to save yourself some money in the long run.

Major cities across the country are receiving LED lighting upgrades and experiencing the economic and environmental benefits. As prices continue to fall, the adoptions and applications of LEDs are seemingly limitless.

Have LED Light Bulb Questions? Infographics & Such to “Enlighten”

Angie's List Infographic - LEDs

Angie’s List Infographic – LEDs

A lot of companies are participating in the new LED light bulb market, also called Solid State Lighting or SSL. These companies can be LED light bulb makers or participate by making some component of the LED light bulb ranging from heat sinks and LED chips to the sapphire growers, polishers and fabricators that make the foundation of the LED, the sapphire chip. All of them have a vested interest in helping consumers understand LED light bulbs and why they are different from CFLs and traditional incandescent light bulbs. We’ve gathered together some resources to help consumers understand their lighting options.

The US Department of Energy is leading the effort to educate consumers about their new lighting options and have enlisted companies that participate in the LED lighting market to help. The DOE has developed some very good resources on their own web site for the industry, http://www1.eere.energy.gov/buildings/ssl/. But they’ve also developed resources for consumers to learn more about their lighting choices. Some sample resources for consumers to learn more about LED lighting include a good FAQ here, http://energy.gov/articles/askenergysaver-led-lights.

The Federal Trade Commission requires a new lighting label, Lighting Facts, on all light bulb packages to help consumers understand what they’re buying. Optical and lighting publication Novus Light Today wrote about these new labeling requirements featuring an infographic from light bulb manufacturer Cree.

Cree, Lighting Facts Infographic

Cree, Lighting Facts Infographic

 

 

 

 

 

 

 

 

 

Many of these companies as well as consumer groups are producing infographics to help the consumer learn more. Here’s a round-up of links to additional resources for learning more about LEDs.

Angie’s List, Infographic: What’s in a light bulb?,

http://www.angieslist.com/articles/infographic-whats-light-bulb.htm

The information in the Angie’s List infographic is great, except for the pricing. LED light bulbs have gone down quite a bit in price with some at retailers in the US coming in at just under $10 and a few others cost less and are even more affordable when combined with rebates and other special offers.

Philips, The LED Lighting Revolution, http://community.lighting.philips.com/servlet/JiveServlet/showImage/102-1201-34-4943/Infographic_LED+Revolution_Philips+2012.png

Light bulb vendor Philips compiled a nice all around look at the energy-saving benefits of LED light bulbs and translates them into benefits for the environment and life.

Lumican, Can LED lighting really save energy and money?, http://lumican.com/portfolio-items/can-led-lighting-really-save-energy-and-money/

Canadian lighting solutions provider Lumican highlights US Department of Energy statistics and compares energy usage and savings of LED, halogen, CFL and traditional light bulbs.

LiveScience, NRDC Guide to Light Bulbs, http://www.livescience.com/42509-goodbye-to-old-lightbulbs.html

The NRDC does a great job at comparing LED light bulbs to CFLs and traditional incandescent light bulbs and gives a good explanation at the new light bulb packaging required by the US government.

We’ve also covered LEDs vs. CFLs on the Clearlysapphire blog. You can read them, here:

Clearlysapphire.com, Incandescent Extinction – Which light bulb will win? LED vs. CFL? http://blog.clearlysapphire.com/?p=601

Clearlysapphire.com, Confused about Your Home Lighting? – LED, CFL and Incandescent Compared, http://blog.clearlysapphire.com/?p=492

Clearlysapphire.com, Tipping Point 2: Finally, A Sub $10 LED Light Bulb, http://blog.clearlysapphire.com/?p=371

Clearlysapphire.com, Tipping Point: Earth Day, 100W Light Bulb Reprieve and Alexander Hamilton, http://blog.clearlysapphire.com/?p=169

LED Lighting Adoption – Lessons Learned

Incandescent lighting ruled the world for more than a century, but times have changed as the world looks to energy efficient alternatives to the incandescent bulb. In the 1970s, compact fluorescent light bulbs (CFLs) came along as the new alternative light source. Market penetration for CFL bulbs never rose above 1% of all units in the first 20 years following market introduction.

In the US, the US Department of Energy joined together with retailers and the lighting manufacturers to encourage consumer adoption of energy-efficient lighting including LEDs and CFLs. There has been careful consideration not to repeat the mistakes experienced with CFLs that led to that very slow adoption rate.

We’ve spoken a lot about the EISA phase-out of incandescent bulbs in Clearlysapphire.com. US legislators imposed strict energy efficient guidelines impacting incandescent light bulbs in the Energy Independence and Security Act of 2007. In a rolling phase-out through 2014, manufacturers stopped making 100-W, 75-W, 60-W and 40-W incandescent light bulbs. But that legislation is only part of today’s story.

Before the phase-out legislation, The Energy Policy Act of 2005 established the Next Generation Lighting Initiative, directing the DOE to “support research, development, demonstration, and commercial application activities related to advanced solid‐state lighting technologies based on white light-emitting diodes.” This legislation was an important part in establishing the DOE’s leadership in the adoption of solid state lighting (SSL).

The US Department of Energy reviewed the CFL experience and developed a strategy for leading the industry and supporting their activities for SSL.  The DOE analyzed both CFL adoption and early SSL experiences since they’ve launched to determine a strategy for the initiative. You can find links to the reports below in Further Reading.

Some of the lessons learned were quite reasonable. First, coordination and collaboration between government and industry should take place at a national level. Secondly, they needed to establish standards and product testing for minimum performance and back-up of long-life claims with standard-based projections and/or guarantees.  Thirdly, they needed to introduce new lighting technology in applications where the benefits were clearly established before moving on to others. They also found they needed to respond to the market and resolve problems and issues quickly. Finally, they needed to know and acknowledge technology limitations, determine and address compatibility issues with conventional lighting, deal with technology failures aggressively, and not launch a new product until performance issues were ironed out.

The parties in the initiative analyzed LED technology itself and possible bumps in the road to mitigate for consumers. They knew that consumers would have to get used to new language of LEDs. For example, the different way of communicating light brightness in lumens rather than traditional watts might cause confusion. The DOE worked with manufacturers proactively to communicate the new language of LEDs through the introduction of new package labeling, LED Lighting Facts program. They also established CALiPER program, to test a wide array of new LED lighting products for the public interest using industry-approved metrics. With a myriad of new LED light bulb offerings, consumers can find LED light bulbs that are qualified using 20 standards and procedures by the familiar Energy Star program. These proactive efforts were designed to smooth the transition and advance consumer adoption.

How successful have these government and industry efforts been?

There has been a very big change in the installed base of light bulbs between 2010 and 2012.  This is mainly due to the government mandated light bulb phase-out. According to Navigant Research and the DOE, the installed base of incandescent A-type lamps (traditional light bulb shape) decreased from 65 percent to 55 percent, while CFLs increased from 34 percent in 2010 to 43 percent in 2012.  LED installations in A-type lamps remained at less than 1 percent in 2012.

But taking note of lessons learned, it was interesting to see increased adoption in applications where LEDs have clear benefits — directional lighting such as lighting used in recessed lighting. According to the DOE and Navigant, installations of directional LED lamps went from 0.1 million in 2009 to 11.4 million in 2012, with an estimated 4.6% of all directional sockets in 2012 using LEDs.

Adoption is looking up for other lighting applications. Analysts expect LED-based lighting to grow, and fast. According to research firm IHS, 2014 will be a big year for LED lamps, accounting for 32% of the entire global lamp revenue.

The biggest barrier to consumer adoption in traditional A-type lighting so far is price, but the prices are coming down to more palatable levels for consumers. You can read more about the adoption of LED-based general lighting and pricing in these previous posts, Tipping Point 2: Finally, A Sub $10 LED Light Bulb and Tipping Point: Earth Day, 100W Light Bulb Reprieve and Alexander Hamilton.

For Further Reading

DOE, Solid-State Lighting: Early Lessons Learned on the Way to Market, http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/ssl_lessons-learned_2014.pdf

DOE, Compact Fluorescent Lighting in America: Lessons Learned on the Way to Market, http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/cfl_lessons_learned_web.pdf

Navigant Research for DOE, Adoption of Light-Emitting Diodes in Common Lighting Applications, http://apps1.eere.energy.gov/buildings/publications/pdfs/ssl/led-adoption-report_2013.pdf

Consulting-Specifying Engineer, Report: Lighting manufacturing leaders to shift, http://www.csemag.com/single-article/report-lighting-manufacturing-leaders-to-shift/7932342ed0c1f2c636596e85aa29d99f.html

 

Incandescent Extinction – Which light bulb will win? LED vs. CFL?

The second phase of the US light bulb phase-out hit a major milestone on Jan. 1, 2014, the deadline to end production of 40- and 60-watt incandescent light bulbs. The deadline passed by with not much notice from consumers.  But, the end of incandescent light bulbs sets up a new battle: LED light bulbs vs. CFLs.

Consumer Sentiments

A recent consumer survey by Osram Sylvania, a light bulb manufacturer, measured public attitudes about energy-efficient lighting and awareness in the US.  Here are some of the results:

  • 4 in 10 consumers are aware of the January 2014 phase out of 60W and 40W bulbs
  • More than half (59%) of consumers are excited about the phase out, as it will help Americans use more energy efficient light bulbs.
  • 46 percent of consumers plan to switch to CFLs,
  • 24 percent will opt for LEDs, and
  • 13 percent say that they will choose halogens.
  • This year, 30 percent of consumers say that they plan to buy a lot of traditional light bulbs where still available and will continue using them.
  • This is a sharp increase from the 2012 Socket Survey which showed just 16 percent said that they plan to stockpile bulbs.

Light Bulb Wars

Consumers still have time to make up their minds about their next light bulb because retailers still have supplies of 40- and 60-watt incandescent light bulbs on the shelves.  Retailers like Home Depot and Lowes have enough stock on the incandescent bulbs for consumers through the spring at least.  However, once the supplies dwindle, what should you buy? LED or CFL?  Let’s compare.

CFLs

A descendant of traditional fluorescent lights, compact fluorescent light bulbs (CFLs) contain argon and mercury vapor housed within that spiral-shaped tube. The bulbs rely on an integrated ballast to produce an electric current that passes through the mixture of gasses, exciting the gas molecules that produce the light.  The time for the ballast to produce the electrical current causes that typical CFL delay when it is turned on.  CFLs use 20-30% less energy than the typical incandescent and last about 9.1 years.  Of course, they do contain mercury, so cleaning up after breaking them and disposing of CFLs after they burn out becomes problematic.  Here’s a link to how to dispose of CFLs safely for you and the environment.

LED light bulbs

Unlike traditional incandescent bulbs, LED light bulbs generate light using a small “package” of several LEDs in a light bulb.  LED light bulbs are more efficient since they use a semiconductor to emit light or photons when electricity is passed through it.  LED light bulbs give off more than 80% of the energy used as light. The good news is that LED light bulbs can cut household energy use by as much as 80% and have a lifetime of as much as 22.8 years, about 2.5 times longer than CFLs.

So what do you choose?

Here’s a quick look at some of the LED and CFL light bulbs available on Homedepot.com (pricing as of 1/8/2014).  While Cree and Philips LED bulbs are a bit more expensive for a single bulb, they do produce a soft white light comparable to CFLS and traditional incandescent, but they last much longer.  If you are looking to save energy, you’ll want to know how efficient they are.  You’ll see this in the chart in the column lumens per watt.  This is a measure of how well the light source produces light.  The higher the number, the better your light bulb is at producing light.  Visit your local retailer to see how they look in person, since tastes vary.  For an explanation of the Color Rendition Index, read this previous post.

A Comparison Guide to LED and CFL Light Bulbs

A Comparison Guide to LED and CFL Light Bulbs

For Further Reading

Fox Business, Retailers Brace for Change Ahead of Incandescent Bulb Ban, http://www.foxbusiness.com/industries/2013/12/31/retailers-brace-for-change-ahead-incandescent-bulb-ban/

Osram, Sylvania Socket Survey, http://www.sylvania.com/en-us/tools-and-resources/surveys/Pages/socket-survey.aspx

NBC News, Majority of Americans still in the dark about incandescent light bulb phase-out, http://www.nbcnews.com/technology/majority-americans-still-dark-about-incandescent-light-bulb-phase-out-2D11805991

NBC News, With incandescents dead, smart bulbs step into the light, http://www.nbcnews.com/technology/incandescents-dead-smart-bulbs-step-light-2D11869426

Buildings, Incandescent Bulb Phase-Out Myths Debunked, http://www.buildings.com/news/industry-news/articleid/16806/title/incandescent-bulb-phase-out-myths-debunked.aspx

Newsday, Light bulb shopping choices under new ban, http://www.newsday.com/business/lightbulb-shopping-choices-under-new-ban-1.6706464

Clearlysapphire.com, Confused about Your Home Lighting? – LED, CFL and Incandescent Compared, http://blog.clearlysapphire.com/?p=492