Project Drawdown defines LED lighting as: the use of efficient light-emitting diodes (LEDs) in commercial or residential buildings. This solution replaces conventional commercial and residential lighting solutions (bulbs, ballasts, and systems in commercial buildings and bulbs in residences), such as incandescent or fluorescent lighting.
LED lighting offers great potential to reduce greenhouse gas emissions in lighting. This is not only due to the high luminous efficacy of LED lighting, but also due to the size of the lighting sector in both residential and commercial buildings.
Traditionally, there have been four types of lamps used in residential lighting: incandescent lamps, halogen lamps, compact fluorescent lamps, and linear fluorescent lamps. Globally, the incandescent and halogen lamps, which have the lowest luminous efficacy, have been the most widely used. That trend is changing, however: in 2011, the market share of incandescent and halogen lamps was approximately 53 percent of global residential lighting, but in 2020, their market share is expected to decrease to 10 percent. There are good-quality LED lamps available at decent prices, but LEDs currently only capture 2 percent of the residential lighting market. If the challenges in product quality are overcome, the prices reduced, and the luminous efficacy increased further, LED lighting is expected to take over the residential sector nearly entirely by 2050.
There has been an additional lighting type used in the commercial sector: high-intensity discharge lamps, but globally, linear fluorescent lamps have traditionally been the most widely used at approximately 75 percent of installed lighting in the commercial sector. However, this is expected to change, as LED lighting products (lamps and luminaires) penetrate the market.
Project Drawdown’s LED lighting solution takes into account the entire luminaire, including the light source, the control gear, and the luminaire housing. The luminous efficacy of the entire luminaire indicates that LED luminaires are more energy-efficient than conventional technologies. Global estimated average luminous efficacy for all commercial luminaires is: 94 lumens per watt for integrated LED luminaires; 56 lumens per watt for LED luminaires with replaceable LED lamps; 61 lumens per watt for linear fluorescent lamp luminaires; 42 lumens per watt for compact fluorescent lamp luminaires; 63 lumens per watt for high-intensity discharge luminaires; and 12 lumens per watt for incandescent lamp luminaires (all assuming an estimated luminaire efficiency of 70 percent). The most modern conventional technologies, especially linear fluorescent lamp luminaires, may currently have greater overall luminous efficacy than some LED luminaires; however, LED luminaires are expected to reach a luminous efficacy of 230 lumens per watt.
The analysis below estimates the potential financial and emissions impacts of high adoption of LEDs in residential and commercial buildings, compared to conventional technologies.
The implementation unit in the analysis is lumen: a measure of the visible light emitted by a source, corresponding to the rate at which a lamp can produce visible light. The functional unit is lumen-hour, which describes the amount of visible light produced. For residential buildings, only the lamps, not the entire luminaire (housing), were compared. The same luminaires in residential buildings can be equipped with different lamp technologies having the same cap type, facilitating easy replacement. For commercial buildings, the entire luminaire was compared between the conventional and solution technologies.
Total Addressable Market
The total lighting demand was estimated separately for residential and commercial buildings. These are based on the Project Drawdown integrated buildings TAM model which collectively calculates the TAM’s of building floor area, roof area, lighting, and all other floor-area driven TAM’s used in the building sector. The estimated areas are also subdivided by building type (residential and commercial), and by building region. This model used numerous sources. From a total floor area estimate, we apply an estimated lighting demand per floor area to get the annual lighting demand market for LED lighting household (37 petalumen-hours in 2018), and LED lighting commercial (62 petalumen-hours in 2018). These data were from several sources, including the International Energy Agency. Current adoption of LED lighting was estimated to be 3 percent of the total commercial lighting market, and 2 percent of the residential lighting market.
Impacts of increased adoption of LED lighting (commercial) from 2020-2050 were generated based on two growth scenarios, which were assessed in comparison to a Reference Scenario where the solution’s market share was fixed at the current levels.
- Scenario 1: It’s assumed that LED can linearly grow to 90 percent of the residential market, and 80 percent of the commercial market by 2050.
- Scenario 2: It’s assumed that LED can linearly grow to 95 percent of the residential market, and 90 percent of the commercial market by 2050.
Direct grid emissions (with emissions factors from the Intergovernmental Panel on Climate Change - IPCC), as well as indirect production emissions, were included in the climate calculations. Emissions from the conventional options were weighted by market share. Commercial LED systems generate 2.4 times as much indirect emissions as weighted conventional options, but residential LED bulbs generate less than their conventional counterparts.
Firsts costs for LEDs average at $61 per kilolumen for the commercial units, and $17 per kilolumen for residential units. This compares to a weighted conventional average of $42 per kilolumen and $4.70 per kilolumen for commercial and residential units respectively. A learning rate of 8.31 percent was only applied to the LED. Operating costs account for the price of electricity, and differ for the commercial and residential buildings, and also for different conventional technologies. No maintenance costs were included.
Drawdown’s LED solutions were integrated with others in the Buildings Sector by first prioritizing all solutions according to the point of impact on building energy usage. This meant that building envelope solutions like Insulation were first, building systems like BAS were second, and building applications like Heat Pumps and LED’s were last. Thus, the commercial LED energy saving potential was reduced to represent the prior energy savings of the higher-priority solutions. No integration effects were taken into account in the residential model, as no other Project Drawdown solution affected household lighting.
In the Scenario 1, the global greenhouse gas emissions reduction of LED lighting was estimated to be approximately 5.9 gigatons in commercial buildings and 10.2 gigatons in residences over 2020-2050. Additionally, the lifetime operating savings amount to $1.4 trillion for commercial buildings and $3.2 trillion for residential buildings at a net cost of less than the conventional options since LED prices are dropping and they have long lifetimes (saving of $1.7 trillion).
The Scenario 2 shows a very similar impact at 17.5 gigatons overall, at a net installation saving of $2 trillion mainly on the commercial side. This produces lifetime operating savings on the order of $5 trillion.
LED’s financial potential, high luminous efficacy and long lifetime should be key to rapid adoption in the coming decades, leading to the emissions reduction potential being realized. The purchase price of LED products is still hampering the wider penetration of the technology, but the price is decreasing. LED lighting offers greater energy efficiency compared to conventional lighting technologies, but its adoption assumes that buyers are aware of and have access to it. To achieve this, educational campaigns can be run, and global distribution should increase as demand rises and prices fall.
Given the expected future efficacy development, LED lighting should offer even higher energy efficiency compared to conventional lighting technologies soon. In addition, LED lighting enables advanced lighting controls including dimmable lighting, various colors of light, and color tuning.
Despite the high purchase price, the total life cycle costs of LED commercial lighting are typically somewhat lower than those of conventional technologies due to the low operating costs. The high energy efficiency, reduced operating costs, and reduced amount of greenhouse gas emissions are considered to be the main benefits of LEDs, but the much longer service life—usually 50,000 hours—is also very attractive.
 The amount of visible light produced for a given power supply.
 The amount of visible light produced for a given power supply.
 The light housing.
 Light output ratio.
 A lumen is a measure of the visible light emitted by a source. We present adjusted units in this summary according to the context: a kilolumen corresponds to one thousand lumens, and a petalumen corresponds to one million billion lumens.
 Adjusted units are presented in this summary according to the context: a kilolumen corresponds to a thousand lumens, and a petalumen corresponds to a million billion lumens.
 For more on the Total Addressable Market for the Buildings Sector, click the Sector Summary: Buildings link below.
 Current adoption is defined as the amount of functional demand supplied by the solution in 2018. This study uses 2014 as the base year.
 To learn more about Project Drawdown’s growth scenarios, click the Scenarios link below. For information on Buildings Sector-specific scenarios, click the Sector Summary: Buildings link.
 All monetary values are presented in US2014$.
 For more on Project Drawdown’s Buildings Sector integration model, click the Sector Summary: Buildings link below.