Although LED lighting shipments accounted for only 7.7 percent of the total lighting market in 2015, they are projected to rise to 27.2 percent in 2020, according to a report from HIS Technology. This growth bodes well for vendors of power supplies and power semiconductors, which are both poised to grow by double-digit rates over the next five years.
LED lighting consists of two market segments: LED lamps, used in lighting fixtures, and LED luminaires, which are complete fixed lighting fixtures built with all components required for operation. Unlike power drivers in LED lamps, power supplies in LED luminaires are typically external.
Every LED light source requires a power driver or power supply to convert incoming ac power to the proper dc voltage and regulate the current flowing through the LED during operation. LEDs lamps, particularly those designed for residential use, contain internal drivers, rather than separate, external power supplies. Shipments of power drivers and power supplies for LED lighting are predicted to grow from 1.4 billion units in 2015 to 4.5 billion units in 2020.
Growth of power drivers and power supplies
The LED market is driven by the requirements of applications and uses, which dictates the design of the driver circuit and power ratings. Medium-power drivers, commonly used for applications in in the commercial/retail market, are predicted to make up 53.7 percent of power driver shipments in 2020. Although low-power drivers for the residential market are projected to make up 44.9 percent of the shipments in 2020, the relative simplicity of the driver circuit makes it easier for lighting OEMs to keep the manufacturing process in house.
High-power drivers offer the highest average selling prices (ASPs) for merchant manufacturers, but they are forecast to account for under 2 percent of the market between 2015 to 2020.
Unlike power drivers in LED lamps, power supplies in LED luminaires are typically external. Supply to the LED luminaire power supply market is very fragmented, because luminaire manufacturers require different current and voltage profiles, depending on regional requirements. This situation makes it challenging for merchant power supply companies to offer standard products and optimize manufacturing.
The market for power semiconductors
Power semiconductor design for LED lighting varies according to the application requirements. For example, in low-power luminaires, the power semiconductor solutions are typically integrated. In high-power LED lighting with more sophisticated power supplies, the number of discrete power semiconductors is likely to increase.
The power semiconductor market for LED lighting is predicted to grow from 7.3 million units in 2015 to 24.3 million units in 2020. Power semiconductor design for LED luminaires varies with application requirements. In low-power luminaires, the solutions are typically integrated. The FET, PFC controller, and the gate driver can all be integrated into an AC-DC controller. Many of the medium-power applications contain two strings of LEDs in parallel, which requires an additional DC-DC controller. High-power applications, the power supply design and semiconductors depend on the demands of the application.
Although they accounted for less than 1 percent of total unit shipments in 2015, microcontrollers – a self-contained system with a processor, memory and peripherals used as an embedded system – are set to grow the fastest over the next four years. IHS forecasts that the market for microcontrollers will grow at a compound annual growth rate (CAGR) of nearly 44 percent from 2015 to 2020. In LED lighting applications, microcontrollers are used for advanced functions including red-green-blue (RGB) for color changing LEDs and for peripheral communications via wireless technologies.
The global ASP for LED lighting is predicted fall at a CAGR of 8 percent from 2015 to 2020, despite dimming functionality and other value innovations in LED lighting products. This decline is mainly due to competitive factors, and many suppliers, particularly those from China, are sacrificing margins to gain market share.
However, the revenue decrease for the LED lighting end market is not expected to have a strong effect on revenue for power components. The mix for merchant power solutions has shifted to higher-end products with higher ASPs, which will help providers of power solutions for LED lighting maintain margins and revenue.