July 16, 2012 — The price of a light-emitting diode (LED) bulb will fall by about half by 2020, hitting $11.06, according to Lux Research. With the LED chip package seeing 70%+ cost reduction, technology innovation will shift to the surrounding “balance of system” elements — thermal management, drivers and optics — to push costs lower.
Costs of the central LED chip package will fall by more than 70% to $2.14 in the next decade, but this makes up just 19% of the bulb costs in 2020. To drive overall costs lower, the related system elements will need to see similar cost reductions.
Read about blogger Dr. Phil Garrou’s costs saving analysis of an LED bulb in Bidding Adieu to Lester Lightbulb and Lester the Lightbulb vs CFL and LED : the Saga Continues
“We find that today’s balance of system technology solutions fall short of the dramatic cost reductions needed to mirror the LED package,” said Pallavi Madakasira, Lux Research Analyst, adding that existing alternatives are ineffective and uneconomical.
Lux Research analysts studied the key LED cost stack components of a 60 W incandescent equivalent LED bulb as well as the technologies available to accelerate cost cuts in order to understand the true pathways to LED bulbs’ potential. “LED lighting is by no means standardized, and potential disruptions to the component stack abound,” Madakasira said.
Thermal management is the biggest target for cost reduction past the package. Active thermal management technologies such Nuventix’s SynJet will lead to cost savings over aluminum-based solutions, but only from 2017 on.
Dimmable drivers are priced at a premium to non-dimmable ones because they enable precise control of the light output and lead to energy savings. Innovation in this area will bring about a 1% cost saving in 2020, boosting the performance of the LEDs overall.
Secondary optics account for about 5% of the total cost of a 60 W equivalent LED bulb. The field is dominated by specialists such as Ledil, Khatod, and Fraen, and innovation lies in improving the shape of the beam and the ability to collect more light from primary optics.
The report, Cheaper, Brighter, Cooler: The Need for Cost Reduction Past the Package, is part of the Lux Research Energy Electronics Intelligence service. Lux Research provides strategic advice and intelligence for emerging technologies. Visit www.luxresearchinc.com for more information.