This article is based on the latest data and analysis from the ISA “SSL Industry Report 2025,” combined with our on-the-ground observations and reflections over the past few years in markets such as China, India, and Europe. We want to discuss: as the energy-saving dividend reaches its peak, what will the lighting industry rely on to survive next?
(Photo of Lawrence Lin delivering a presentation on stage at the 2019 DOE SSL R&D Workshop)
1. First, About ISA: Who is Mapping the Global “Ledification”?
ISA (International SSL Alliance) is composed of government departments, industry associations, research institutions, and leading companies from multiple countries. It is one of the most important global collaboration platforms in the field of solid-state lighting (SSL). Since its founding, ISA has accomplished three key tasks:
Bridging: Connecting policy, standards, and industry
- In regions such as China, Europe, and North America, ISA assists governments and standards organizations in aligning SSL technology roadmaps, efficiency targets, and industry realities.
- It participates in and promotes the development and revision of energy-efficiency standards, labeling systems, and energy-saving policies across multiple countries.
Mapping: Providing a “radar and compass” for global SSL development
- Regularly publishes global SSL industry reports and roadmaps.
- Systematically analyzes luminous efficacy limits, cost curves, application scenarios, and policy trends.
- Serves as an important reference for decision-makers, companies, and investors in forming strategy.
Accounting: Clarifying the contribution of energy saving and emissions reduction
- Quantifies the impact of improved lighting efficiency on carbon reduction, reduced electricity demand, and infrastructure pressure.
- Makes “promoting LED adoption” not just a technical choice but an inevitable option in energy and climate policy.
簡而言之：
Without ISA’s decade-plus efforts in bridging, mapping, and accounting, global consensus on replacing traditional light sources with LEDs would not have formed so quickly.
2. Norman and DOE: Turning Good Technology into Global Policy
One of the lead authors of the SSL Industry Report 2025 is the well-known Dr. Norman Bardsley. His role bridging ISA and DOE deserves special attention.
ISA’s Chief Architect
- Longtime chief analyst/advisor at ISA.
- Integrates policies, technological progress, and industry data into a “common language.”
- Enables decision-makers from different countries to discuss the future on the same map.
Key Strategist for DOE SSL Program
- Has participated for many years in the U.S. Department of Energy (DOE) Solid-State Lighting (SSL) Program.
- Helps set target efficacies, cost pathways, technical milestones, and demonstration projects.
- Turns “replacing traditional light sources with LEDs” into a national-level project with a roadmap and timeline.
Translating Technological Evolution into Industry Decisions
- He focuses not only on laboratory limits but also on commercial viability: when can it reach the market? When will costs be acceptable? Which applications benefit first?
- This is why his reports can persuade both the technical community and policy-makers, as well as investors.
3. Our Personal Experience: From “Full Spectrum” Skepticism at DOE to Today’s HCL Consensus
Lawrence Lin also has a personal connection with Norman.
In early 2019, at Norman’s invitation, Lawrence Lin attended the DOE SSL R&D Workshop representing LEDVANCE and delivered a keynote titled:
“Towards the Era of Full Spectrum LED Lighting.”
At that time, many were skeptical about “Full Spectrum”:
- Some thought it was merely a marketing term.
- Others questioned why so much effort should be spent on spectral quality under tight efficiency and cost pressures.
Looking back today, Full Spectrum LEDs became one of the key physical enablers for Human-Centric Lighting (HCL):
- Without LEDs closer to the natural spectrum, tunable, and easily measurable and controllable, discussions about circadian rhythm, mood, and visual comfort would have remained confined to labs and PowerPoints.
- For HCL to truly reach schools, hospitals, offices, and urban spaces, there first had to be a “good, well-behaved” light source.
Lawrence Lin has always valued the intense discussions with Norman and DOE colleagues at that meeting. Many of the points that were questioned at the time have since become industry consensus.
From “making LEDs more energy-efficient” to “making light more human-centric,” the bridge between these two was precisely “Full Spectrum + measurable human-factor metrics.”
4. After the “Energy-Saving Campaign” Was Declared Victorious
Over the past twenty years, driven by institutions such as ISA and DOE, global policies, subsidies, and research funding have elevated LEDs to a central position:
- The average efficacy of artificial lighting worldwide increased from about 50 lm/W in 2005 to nearly or over 100 lm/W by 2025.
- Humanity’s “use of light” has almost doubled — longer lighting hours, higher brightness, and more complex scenarios. We have never been more adept at using light than we are today.
However, in 2024–2025, several key signals emerged:
Governments say, “It’s time to step back.”
- Many countries are gradually reducing dedicated SSL funding.
- Relevant international projects are completing their phases — the energy-saving light bulb battle is largely over.
Industry media bows out
- Long-established professional media are either closing or transforming, and the industry focus is quietly shifting from “luminous efficacy and devices” to “applications and scenarios.”
Efficiency rises, electricity use doesn’t drop significantly
- Lighting electricity consumption has not halved despite doubled efficacy; in some years, it even slightly increased. Efficiency gains are outweighed by “more light, larger areas, longer hours.”
Our view:
The “energy-saving light bulb battle” is over. In the next decade, companies focused solely on lm/W will gradually lose influence. The new battleground is: light and humans, light and health, light and spatial value.
5. China’s LED Industry: Revenue Up, Profits Hollowed Out
The report’s analysis of China’s LED industry is particularly eye-opening:
- Listed companies focusing on LEDs still see overall revenue growth, but net margins continue to decline, with industry-wide profitability negative.
- Gross margins for packaging and general lighting businesses are low, and capacity utilization has fallen below warning levels.
- Export volumes remain substantial, but unit prices have dropped significantly, with many categories experiencing double-digit declines within a year.
This means:
Volume rises, “value” collapses
- Production lines are running, orders are not few, but net profits are thinning or even turning into losses.
China is the global “LED granary,” not the price setter
- Upstream in modules, light sources, and fixtures, the true leverage for project influence and brand premium lies in systems and solutions.
Price wars have exhausted traditional profit models
- Competing only on wattage, materials, and cost, without shifting to “good light + good space + good systems,” leads only to exhaustion.
Our judgment:
If Chinese lighting companies continue to view the world through “add more lines, make more molds” in the next five years, today’s financial reports may already be the most “presentable” pages.
6. Application Scenarios: Where Is the Real “Second Growth Curve”?
The ISA report analyzes mainstream applications separately: automotive, horticultural, roadway, displays, UV, NIR, and smart lighting. Here are a few critical for Chinese companies:
1. Horticultural Lighting: From Hype to Financial Reality
- The global LED horticultural lighting market is still growing, but growth is becoming rational.
- Several vertical farm projects in Europe and the U.S. suffered losses or bankruptcy — the accounting isn’t about fixtures, but the entire business model.
Summary:
- Fully artificial-light vertical farms have extremely high building, energy, and equipment costs. Without clear crop positioning and supply chain design, profitability is difficult.
- More promising are high-value crops like leafy greens, herbs, microgreens combined with renewable energy and precise control.
Conclusion:
Chinese companies in horticultural lighting should not just sell “lights,” but provide an integrated solution of crops + algorithms + energy + business model.
2. Automotive Lighting: Technical High Ground, Not a “Lifesaver”
- The automotive LED device market continues to grow, led by a few international brands.
- Technologies such as ADB adaptive high/low beams and dynamic taillights continue to evolve, but regulations, OEM platforms, and reliability requirements make this a slow-paced, high-entry-barrier field.
My view:
Automotive lighting is suitable for building technical and brand prestige but is unlikely to solve large-scale overcapacity in the short term. A more pragmatic approach is to reverse-apply automotive-grade optics and reliability thinking to human-centric lighting in buildings and cities.
3. Micro-LED and Displays: A Marathon of Capital and Time
- Some leading micro-LED companies saw revenue growth and narrowed losses from 2022–2024, but in 2025, inventory, exchange rates, and demand fluctuations caused sharp revenue drops and widening losses.
For most lighting companies:
Micro-LED is more like a “ticket to technical influence” rather than a “main business savior” in the next 3–5 years.
7. Human Factors and Health: HCL Becomes a Hard Metric
In recent years, from DOE to IES, CIE, and then WELL and LEED, everyone has been pursuing the same goal:
- Transform “good light” from an adjective into measurable, deliverable engineering language.
The report highlights three aspects in the “Light and Health” section:
Circadian Impact
- Expert consensus recommends daytime melanopic EDI at the eye level to support stable circadian rhythm and nighttime sleep.
- Under constraints of efficiency and glare, achieving full compliance using only electric light sources is not easy.
Blue Light and Photobiological Safety
- Typical residential lighting poses minimal skin risk; the main concern is high blue light output and retinal risk for specific sensitive populations.
- This requires finer classification and more empirical research.
Glare and Temporal Light Modulation (TLM)
- The point-source nature of LEDs and certain dimming methods complicates glare and flicker issues. Headaches, fatigue, migraines, and photosensitive epilepsy can be associated with improper TLM characteristics.
This echoes Full Spectrum LED:
- Without better spectral carriers, HCL cannot be truly implemented.
- Full Spectrum + measurable human-factor metrics is the essential bridge from concept to engineering practice.
Our judgment:
The next industry reshuffle will not favor the cheapest LEDs but those who can clearly define, implement, measure, and deliver human-factor and health outcomes.
8. Smart Lighting: From “Connected Streetlights” to “Urban Sensing Infrastructure”
ISA makes important observations in smart lighting:
In China:
- Thousands of medium and large smart lighting companies exist; many SMEs participate in subsystems and projects.
- Indoor and outdoor smart lighting shipments continue to rise.
Globally:
- Smart streetlight installations steadily increase; multiple cities achieve 50–70% energy savings using LED + intelligent control, often with payback faster than expected.
Our observations:
- The “financial logic” of smart lighting is proven: energy savings + O&M reduction + carbon reduction + data value is reflected in urban financial and operational data.
Chinese companies should avoid two traps:
- Being only a “hardware supplier”: delivering many nodes but outsourcing city operations, data, algorithms, and services.
- Treating smart lighting as a “one-off weak current project”: after handover, only short-term project profits remain, with no long-term operation or data accumulation.
Real opportunity:
Deliver integrated solutions of good light + good control + good algorithms + good operation, connecting human-centric lighting, energy savings, smart cities, and healthy buildings into a network.
9. Next 5–10 Years: Three Directions We See
1. “Good Light” Becomes a Moat, Not an Extra Cost
- Standards are evolving: IES, CIE, WELL, etc., are integrating health and circadian metrics into standards and certifications.
- Client awareness is shifting: from “replace LEDs to save energy” to “how much is lighting worth for employee health, efficiency, and brand experience?”
Recommendation:
- Supply chain companies should include photobiological safety, circadian photometry, TLM metrics in specs, not just CCT/CRI.
- Brands and system integrators should tell stories using human-factor metrics + project data, not only lumens, watts, and price.
2. Upgrade from “Product Logic” to “Space + People + Algorithms” Logic
- Future competition is not: “My current-generation fixture is 10% cheaper than the last.”
- It is: “I help your building / campus / city optimize energy use, maintenance, human efficiency, and brand value while ensuring health and experience.”
Recommendation:
- Organize product lines by scenarios: office, education, healthcare, hospitality, elderly care, industry, urban renewal.
- Each scenario requires measurable, deliverable, and reusable human-factor lighting formulas and dimming strategies.
- Make measurement and verification part of the solution: vertical illuminance, melanopic EDI, TLM, SVM, DGP, etc., must be measurable on site and presented in reports.
- Use a data loop for long-term operation: not just turnkey delivery, but continuous optimization according to seasons, schedules, and populations.
3. Chinese Companies Must Move Beyond “Exporting Fixtures”
- Current landscape: China is a major producer of LED chips, packaging, modules, and fixtures, and a key supplier for smart lighting hardware and platforms.
- However, China’s voice in global health lighting standards, spatial design influence, and human-factor research is still limited.
Recommendation:
- Actively participate in international standards and alliances (IES, CIE, GLG, WELL) not just by attending meetings but bringing data, cases, and solutions to discussions.
- Turn Chinese projects into international benchmarks: organize excellent campuses, hospitals, campuses, and cities into bilingual white papers and case libraries.
- Showcase that good light + good space + good systems are successfully implemented in China.
- Upgrade the “internal skills” of price competition into the “combined force” of an ecosystem: from chips, packaging, modules, fixtures, systems, algorithms, measurement, standards to operation, forming a Healthy Light Ecosystem Alliance to go global together rather than individually.
Conclusion: Turning Point Is Here — Different Choices, Different Futures
The 2025 SSL Industry Report by ISA, under the comprehensive analysis of Norman and other experts, gives a very clear signal:
- The era of “more energy-efficient lamps” is over.
- The industry is moving from the “energy-efficiency era” to the “Good Light Era”: good circadian rhythm, good mood, good spatial experience, good city nightscapes, good hospital wards, classrooms, factories, farms…
At this turning point:
- Some will continue competing on every LED chip and fixture;
- Others will raise their sights to focus on standards, scenarios, ecosystems, health, and city-scale lighting environments.
Those who endure will see a new world; those left behind often think it was just another “bad market cycle.”
If you are considering: “What should we move from ‘selling lights’ toward next?”, feel free to continue the discussion in the comments.
Sources and Copyright Statement
- Some data, charts, and judgments in this article are quoted from ISA’s SSL Industry Report 2025, whose lead authors include Dr. Norman Bardsley and other international experts.
- Any interpretation or extended commentary represents the author’s personal views; in case of discrepancies, refer to the original ISA report.
- Original data and charts are copyrighted by ISA and the respective authors.
- This article is intended for industry exchange and academic discussion only, not for commercial resale or republishing.
- If the original report authors or ISA have any concerns about citation, please contact the author, and adjustments will be made promptly.
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