In LEDs Magazine, Financial analyst Jed Dorsheimer of Canaccord Genuity estimates the LED portion of the Bill of Materials (BOM) at $25. Jed argues that number needs to drop to $4 to enable a $10 retail price for a 1000 lm bulb. He says the cost is critical because he estimates the current payback time for an LED bulb to be 11 years in residential applications. Estimates on the industry are that LED light bulbs will last about 50,000 hours (more than 2000 days if lit 24 hours a day) versus 1,000 hours for the typical incandescent bulb.
Dorsheimer sees a move to larger diameter sapphire wafers necessary to the success of LED lighting. He says migrating from 2-inch wafer to 4- or 6-inch diameter wafers offer better thermal stability and ultimately better yield. Dorsheimer stated, “Yield trumps all in this industry.” He said that lighting could consume more than 100 billion additional LEDs by 2020.
LED light bulb
Haitz’s Law is an observation/prediction about the steady improvement over the years of light-emitting diodes – LEDs. It states that every decade, the cost per lumen (unit of useful light emitted) falls by a factor of 10, the amount of light generated per LED package increases by a factor of 20, for a given wavelength (color) of light.
It is considered the LED counterpart to Moore’s Law, which states that the number of transistors in a given integrated circuit doubles every 18 to 24 months.
Sapphire is used for LEDs much like the computer industry uses silicon as a foundation for computer chips. Roughly 80% of the LED market uses sapphire for a foundation. Bridgelux has made some noise about building a larger diameter wafer out of silicon. Bridgelux contends that leveraging silicon would bring down costs by using existing automated semiconductor lines. However, the company admits that a number of the processes used to produce LEDs would have to be modified because some materials used are incompatible with silicon substrate manufacturing.
Bridgelux maintains that have to work 12 to 24 months to catch up with the sapphire companies. Rubicon Technology is already in volume production of 6 inch and 8 inch sapphire wafers for LED manufacturing. Others like Monocrystal and STC have been working to produce larger diameter sapphire wafers as well.
In an interview with Efficien’Si Magazine, Rubicon Technology CEO Raja Parvez says that LED manufacturers “want 8-inch production because it is more cost effective and re-utilises the current infrastructure available to them.” He says that a company like Rubicon can help companies move to larger diameter “through specification alignment and participation in customer design-of-experiments for process optimization. Many of our engineers are from the optoelectronics and semiconductor industries. Since we have this experience, and work with many LED chip companies, we can reduce the cycle time at the R&D level and reduce the trial period so they can move to production faster.”
Recently, LEDs Magazine featured an article by analyst Tom Hausken, Director of the Components Practice, at Strategies Unlimited about the recent bump in MOCVD reactor sales. MOCVD reactors are used to manufacture LED chips. According to Tom, the LED world needs more, better reactors. But, the likelihood is that this new generation of reactors will be used for high-end LEDs – the hardest to make.
On the surface, many industry observers reacted to the shopping spree in reactors negatively. Many think it is a bubble, but Tom thinks otherwise. What’s behind all this new interest in reactors? Subsidies from the China government have been encouraging a new “LED Valley” in China. The new investment is drawing in investment from Taiwan and Korea to build joint venture plants in this new “LED Valley.” Again, this is just at the surface. These reactors are likely to contribute to low-end cheap LEDs.
His rationale is that high-end LEDs need experts to run the MOCVD reactors. There are only so many of these guys for hire in China and they are paid very handsomely for that expertise, like CEOs and rock stars, at as much as $250,000 a year. Tom writes “…none of this is likely to impact the market for high-end LEDs, which are the most difficult to make. The high-end suppliers know their process well, and are likely to expand capacity regardless of subsidies.”
Who wins? According to Tom, “the end-user gains, no matter what. China gains some experience that it didn’t have, and more domestic production to serve its vision for a greener future. If overcapacity leads to a glut of LEDs, the most pressure will be on lower-tier LED suppliers.”
Recently, market research firm Yole Developpement put on a webcast about the sapphire substrate market for LEDs. The webcast featured Yole analyst Philippe Roussel and Rubicon Technology president and CEO, Raja Parvez.
During the webcast Yole’s Roussel shared market data about the significant progress six inch sapphire wafers are making into the LED market. By 2020, Yole expects six inch large diameter sapphire to dominate the market with a 70% market share.
Source: Yole Development
Rubicon’s Parvez walked through Rubicon’s approach to making large diameter sapphire. Parvez highlighted the high barrier to entry to the large diameter market and the need to grow sapphire in an unconstrained environment to maintain quality to maximize yield and throughput to produce the commercial volumes needed to support the high growth LED lighting industry.
Rubicon Technology Sapphire Boules
You can view the Webcast archive here: Sapphire Substrates for LED: The Big Move Toward 6″ Has Already Started
We want our LED TV! NASCAR premiered the world’s largest LED TV at the NASCAR All-Star Race on May 21st at Charlotte Motor Speedway. The display stands 110 ft. above the race track centered along the backstretch giving the crowd a great view of the racing action. It took Panasonic 11,000 man hours over four months to build the 16,000-square-foot screen using 158 panels made with LEDs. The 332-and-a-half-ton structure is the largest HDTV in the world. The screen is made up of 158 panels illuminated by nine million LED lamps.
Dale Earnhardt Jr., NASCAR’s most popular driver, took the HDTV for a test drive that showed him taking virtual laps around the legendary 1.5-mile track using an iRacing simulation. Click this link for the video.
Dale Earnhardt, Jr. gets a sneak peek at the world's largest LED TV.
Lighting is an energy hog worldwide. For example, lighting accounts for about 17.5% of global electricity use and, within the United States, the majority of lighting energy is consumed in commercial buildings. The United States alone accounts for approximately 20% of the world’s total electricity consumption for lighting at an annual cost of over $40 billion.
Recent innovations in lighting technologies like solid state lighting based on LEDs has the potential to save a lot of energy. Solid state lighting brings significant long-term potential for energy savings in the commercial building and residential sectors.
The largest share of electricity is used for lighting commercial and public buildings, followed by residential lighting, industrial sector lighting, and outdoor/street lighting. According to Pike Research, fluorescent and light emitting diode (LED) lighting technologies will play an increasingly important role in the U.S. market, making up over three quarters of that market by 2020.
Today we’re going to talk about the demand for LEDs. A lot of people don’t realize the amount of products that take advantage of LEDs. 85 percent of the LED market is based on LEDs, so as the markets for products grow, that demand for LEDs will grow, leading to even greater demand for sapphire.
Large diameter wafers are fundamental to helping the LED manufacturing industry scale to support the consumer electronics, automotive and general lighting industries. The first stage of the LED market was driven by LED use to backlight the displays in mobile phones, tablets and GPS systems, and larger backlighting applications in laptops, desktop monitors, LCD televisions and signage. The next market for LEDs was the automotive market for use in headlights and other exterior lights, interior lighting and dashboard lighting.
The next high growth stage of the LED market is general lighting. The energy efficiency of LED lighting makes it attractive to commercial and residential applications worldwide. As government entities around the world pass legislation banning incandescent light bulbs, LEDs are becoming an attractive alternative. According to market research firm Strategies Unlimited, the global market for LED luminaires (that’s the whole LED Lighting fixture) is expected to grow from $3.8 Billion in 2010 to $8.3 billion by 2014.
We expect to look out our windows and have a clear picture of our surroundings whether it is at home or in a vehicle. But, not all windows are created equal. In an industrial setting, regular windows based out of silicon glass just don’t cut it. In fact, many industrial windows and applications depend on the second hardest material on earth – sapphire.
Sapphire windows are used in some of the world’s harshest climates and beyond – in space. Here are some cool uses for sapphire:
• Missile dome windows for advanced weaponry that come into contact with large variations in temperature and dusty environments
• Instrumentation – they are used in probes that are exposed to hazardous and corrosive chemicals
• Windows in space vehicles and cameras that are exposed to harsh environments
As we mentioned in an earlier post about the production of the first 12-inch wafer, we wanted to take a look at the rationale for the move to the larger diameter wafers. And it’s all about affordable real estate. Not land, but the amount of quality space on a sapphire wafer that can be used to produce LEDs.
As LED-based products from tablets and HDTVs to residential light bulbs become more popular, the LED manufacturers that supply LEDs to consumer electronics and general lighting markets need to scale up operations to meet the growing demand for LEDs. That means they need more materials to make LEDs like sapphire substrate. Relying on 2- and 4-inch diameter sapphire substrates won’t produce the volume needed to help the consumer electronics and general lighting industries scale up to production levels needed to satisfy the demand.
The table below is an “order of magnitude” guide to the number of LED chips expected from each wafer size. The numbers are estimated based on typical dimensions for a HB (High Brightness) chip. As wafer size increases, more LED chips can fit along the outer perimeter due to reduced curvature, especially for the larger HB chips. This is called the “edge effect” and provides incrementally more chips than just a raw calculation of geometrical area. For example, a 6” wafer will produce approximately 10X to 12X more chips as compared to a 2” wafer, although the geometrical area increase is 9X.
Wafer Size Surface Area # LED Chips
||# LED Chips
||4.5 N ~ 5 N
||10 N ~ 12 N
|| 20 N ~ 22 N
|| 45 N ~ 50 N
Caption: Chips per wafer guide for various wafer sizes