Category: LED

Shortly after the first transistor was invented some talented folks had the idea of crafting several on the same piece of silicon and the integrated circuit was born.  A few more transistors were added and the integrated circuit was renamed the Large Scale Integrated circuit, then the Very Large Scale Integrated Circuit, then the industry ran out of adjectives and concentrated instead on putting 4bn transistors on a chip.  So it is with the LED industry, where the definition of ‘high brightness’ is somewhat flexible, depending on whether the conversation is about LED die, light engines or luminaires.

Most LEDs emit visible light, with much of the current focus on the development of white LEDs to replace tungsten and fluorescent lights in general illumination.  A white LED that is 100 percent efficient would run slightly north of 400 Lm/W.  Modern high brightness LEDs are rapidly approaching 40 percent efficiency, meaning the remaining 60 percent comes out as heat. Unless this heat is removed, the LEDs will fail faster than you can say “tungsten filament” and a major part of developing LED lighting products is in devising effective thermal management solutions.

Of particular importance to the thermal management of LEDs is the substrate or circuit board to which the semiconductor components are attached.  High brightness LEDs are physically small, usually measuring less than 0.5 mm on a side.  This means that not only does a significant quantity of heat need to be removed but, more importantly, the thermal flux, which is the quantity of heat per unit area, is intense.  Consequently only a limited selection of materials are suitable for this application since candidates must possess the combination of low thermal resistance and good dielectric properties.  Tiles made from ceramics like aluminium nitride and beryllium oxide are technically superb but very expensive, while metal-in-board PCBs such as those based on Nanoceramic coated aluminium can provide similar thermal performance at a fraction of the cost with the added benefits of physical robustness, availability in large panels and 3D profiles.

It should be noted that the definition of “high brightness” is also influenced by the wavelength of the LEDs.  Aside from visible LEDs there is a rapidly growing industry, currently worth around $100m/annum that manufactures LEDs to emit UV radiation.  These are used in all manner of industrial processes from disinfection and sterilization through plant growth, printing to scientific instruments.  A key difference with white LEDs is that UV LEDs are incredibly inefficient.  A “high brightness” UVC LED might only be 5 percent efficient.  In other words, these LEDs are actually high power electrical heaters and produce the odd photon every second Tuesday.  Not only do UVC LEDs produce significantly greater heat than white LEDs, to make matters worse the small light output means the LED die have to be packed extremely densely in order to achieve acceptable optical output.  In this industry, it is not uncommon to find UVC LEDs that are operating at power levels of 150 W/cm².  To put that figure in perspective, a COB domestic white LED ceiling down lighter is running at about 5 W/cm², some 30 times lower.

For these high brightness UVC LEDs, the approach to thermal management is completely different. Rather than a heat sink to dissipate the heat to air, the LEDs are mounted on a water-cooled metal block, held at constant temperature by an industrially-sized chiller.  Between the LEDs and the cold plate there still needs to be a circuit board to provide electrical connection to the LEDs.  All organic materials are excluded since they would be rapidly destroyed by the UVC radiation.  Thus the choice reduces to metallized ceramic plates with their attendant economic and physical limitations or Nanoceramic coated aluminium, which, with a bit of ingenuity, can incorporate water cooling channels.

Efficiency gains probably mean that the next definition of “high brightness” in the context of white LEDs will not have to resort to water cooling.  Nevertheless, it is comforting to know that thanks to the UVC LED industry the thermal solution has already been proven and the required materials and components are available off-the-shelf, today.

Promising higher luminous efficiency and service life, environmental friendly LED lighting is revolutionizing the $110 billion dollar lighting industry. With more than $25 billion dollars in sales last year, the LED industry is around 11 percent of the size of the computer market, and is still growing. As a relatively nascent industry, it can be hard to predict and understand the LED industry by itself, but by comparing it to the more mature computer hardware market as well as understanding the particularities of the LED market, we can get a good idea of the current state of the industry and its future outlook.

In certain ways, an LED luminaire parallels a desktop computer; A complex finished product is assembled from components designed by various manufacturers, contractors and suppliers. Both are driven by semiconductor processes and just as Moore’s law has for years predicted growth in CPU and memory performance, improvements in transistor density and manufacturing have driven LED performance and continue to improve luminous efficiency.

But not everything is the same. Whereas the computer industry is monopolized by relatively few established brands, the LED industry is more of a green field market with a large number of players. Sales from the top LED lighting brands Philips, OSRAM, Panasonic, General Electric, Acuity Brands, Zumtobel, Toshiba, Cooper Lighting, Cree and Hubbell combined account for less than 30 percent of the market share in the lighting industry. The majority of the market space is occupied by smaller vendors and opportunities are ripe for companies with unique offerings and innovative business models.

GlacialTech makes the following outlook statements and development forecasts for the LED lighting industry:

Price competition in the LED lighting industry will become fiercer, especially in the LED package segment.
LED packages are made through the semi-conductor process and just like CPUs are driven by Moore’s law, but unlike the CPU industry which is almost monopolized by Intel, the LED manufacturing industry is much more competitive with several leading brands as well as a number of regional suppliers, Price competition in the this segment means LED package prices will continue to decrease while performance continues to increase. We expect that the price to performance ratio of the most efficient LED lighting modules will be $0.13/W by the end of the year, and the price of LED lighting modules with performance of 150 lm/W will drop to $0.10 /W or below by the end of 2016.

Value will shift from the LED lighting unit to the driver and thermal module.
The cost of a lighting module for a 100W LED luminaires will be around $10 by the end of next year. For the same 100W mid and high-end LED luminaires, the cost of the thermal modules or LED driver will be double or even triple that of the lighting unit. This is because compared to LED lighting packages, the cost of thermal modules and LED drivers is much more inelastic. Being dependent on the cost of raw materials and manpower. The cost of materials is almost constant unless the price of raw materials changes. There is seldom a huge rise or fall. In addition, the manufacturing process is still quite labor-intensive and involves complex manual procedures, whereas the LED package manufacturing process is increasingly automated.

Gross profit margins of LED lighting modules will continue to erode compared to others parts and components.
LED packaging requires high capital and human investment compared with LED driver and thermal design. To establish a packaging house, high capital costs are needed to procure equipment, and high operating costs are needed as well to compensate the diverse array of professionals required to design highly efficient products and control production quality. In power or heat sink industries, on the other hand, just a few senior design engineers are enough to design effective products with a high price-performance ratio, and therefore staffing costs are relatively low. The equipment used to manufacture LED driver and thermal module is often less specialized. If this equipment was already been used to manufacture other products over the years it may already be fully depreciated.

The COB package has a promising future.
Considering costs of materials and the continuous improvement of COB quality and efficiency, sales of COB packages will continue to rise in the following years, especially as the compact COB form factor is suitable for more LED luminaire designs than larger MCPCB packages. There are already 100W, 200W and even 300W COB LEDs on the market these days making it is easy for luminaire manufacturers to make a 100W~300W (system efficacy 100+ lm/W, CRI 80) lighting products with just one powerful COB coupled with a high quality lens, thermal module and power-efficient LED Driver. The material cost of this new kind of COB powered luminaire is lower than that of traditional LED luminaires in which multiple LEDs on a large MCPCB were used. In addition, assembly of these COB luminaire is simplified, leading to lower manpower costs.

Vertical integration will occur in price competitive segments while specialization will occur at the premium lighting product segment
In the lighting industry, bulbs and tubes are relatively low-priced, making them suitable for vertical integration to improve profit margins. Low-priced and competitive products should be manufactured with fully automated process at one production facility, from the LED package, to plastic injection, metal press, assembly, all the way through to the final packing process. Premium lighting products such as luminaries with differentiated designs and specialized applications may not be able to efficiently improve the price-performance ratio of individual components to make the products more competitive. Hence, companies involved in the premium product space benefit less from vertical integration and can consider specializing in their product segment to maximize profits and market share.

While big name brands own a large share of today’s LED market, there is high growth potential in this industry and plenty of opportunity for emerging companies with innovative technology and unique products.
Thanks to the abundant array of high quality LED package suppliers, luminaire manufacturers have many choices. With the development of COB LEDs, luminairecompanies can build a finished product with barely more than a thermal module and LED driver with appropriate control mechanisms. This is why more and more new companies continue to join the industry in addition to world-known brands and regional brands.  Just as innovate technologies and business models pushed the computer industry from big mainframes made by a few big brands to PCs manufactured by myriad smaller companies, the LED industry will continue to mature. The next generation of LED lighting will be driven by forward thinking businesses able to see market trends and take advantage of the latest technologies to drive industry growth.

We have described the current status of the industry and made the forecast above. However, each company which finds its own position in the same environment and selects the appropriate business model can generate higher economic profits than its competitors.

To date, Return on Investment (ROI) has been a guiding force in the adoption of commercial LED technology. If a $100 fixture saves $33 each year, the ROI is naturally 33 percent. If the LED fixtures earn a utility rebate that is either based on a prescriptive amount like $25 or a performance amount on the reduces annual kilowatt hours, the net hardware cost could come done to $75. Given that the installation labor may come in around $25 per fixture, the rebate often offsets a major portion of the installation, holding the ROI in this example to 33 percent, or a 3 year payback. Paybacks in three years or less are favorable, especially since the LED fixture may last for a decade. The rebates are a key aspect of the ROI, and many utility companies use the DesignLights Consortium (DLC) for their Qualified Products List (QPL) to determine eligibility on a fixture by fixture basis.

ROI is a very valuable assessment metric, but it does not address long term value when comparing one or more LED fixture to other options. Light output, measured in lumens, has been a performance metric in the lighting market relative to power consumption, measured in watts. The lighting industry has largely used lumens per watt (lm/w) as a guiding metric to determine fixture value. Lm/w is similar to miles per gallon (mpg) for vehicles, but it does not take into account cost. When buyers consider purchasing a car, the fuel efficiency is typically relevant, but mpg is only part of the decision relative to the total cost, features, and warranty on the vehicle. Lumens per dollar is a way to link the output of the light to the cost, and lumens per dollar over the warrantied life is a guide to determine lifecycle value and Total Cost of Ownership (TCO).

Lm/$ over LED life and TCO are strong sibling metrics in addition to ROI. You could have an ROI “winner” for fixture “A” that is a lower cost LED fixture, but if it has lower lm/w and a shorter warranty than other options “B” or “C”, it will actually cost more over time to operate and maintain. Think of LED fixtures as energy tools vs product commodities in assessing a new purchase.

Steps for Energy Intelligent Assessment of LED fixtures:

1. Open a spread sheet
2. Get the Specification Sheets for the LED fixtures that you are reviewing
3. Use the spread sheet rows for each LED light
4. Use the spread sheet columns as follows to enter the data (from left to right):
   A: Manufacturer Name, B: Product Number, C: Lumens Output, D: Watts, E: Warranty in Years, F: Product Cost
5. Run the calculations in additional columns for each LED light:
   G: Lumens/Watt, H: Lumens/Dollar, I: Lumens/Warranties Life, J: Lumen/Dollar over Warrantied Life

Given equal aesthetic appeal, functionality, installation cost, the winner should be easily apparent in the column with Lumen / Dollar over Warrantied Life.

The answer is YES. Today, some US LED manufacturers have already “cracked the code” on beating the Chinese at price, while maintaining high quality. This may be surprising to many business owners, energy advisors and lighting professionals. In a presidential election year, candidates on both sides of the aisle have spoken about the benefits of increasing US manufacturing and the resulting job creation. Domestic manufacturing alone does not create economic growth if the products that are produced are not competitively priced and purchased by consumers.

The formula for competitively priced US made LED fixtures is based on several key factors:

LED Automation: We have to work smarter and not harder. The Chinese labor costs are far below the US costs. So, automated technology “labor” combined with select human labor for quality assurance is key for cost control. We can also engineer the LED fixtures in modular ways to integrate with automation more cost-effectively.

LED Shipping: The “landed” cost with the US Customs cost of imported goods are surprisingly higher than most consumers would image. By making products in the US close to population hubs, like the US northeast corridor, Chicago, Los Angles, etc. the domestic products can shave off dollars that add to the cost of the Chinese imports. For large size fixtures such as warehouse high bays, the shipping cost from half way around the world is often a larger percentage of the cost than something like socket bulbs that replace the Edison lamps and Compact Fluorescent Lamps (CFLs).

LED Niches: The Chinese LED manufacturers are typically focused more on mass market volume than custom niches. So, there are “riches in the niches” for American manufacturers. As an example, there is some demand for protective impact cages on gymnasium lights at schools where students playing lacrosse may use the lights for target practice…against the wishes of their coaches. Needless to say, a high speed lacrosse ball can do significant damage to a metal halide, fluorescent, or LED light. The demand for impact resistant LED gym fixtures is much less than the mass market demand for many other types of lights. The Chinese have focused on the volume over the specialty fixtures, so their costs go up dramatically if they have to engineer a specialty application and interrupt a production line to make it. This photo is an example of an impact resistant LED high bay that is lower in cost than Chinese imports both with and without the cage. The apples to apples metric for evaluating cost is Lumens per Dollar, and this fixture wins the day. 

Efficiency and TCO: The output of light relative to the energy consumed (lumens per watt) is also the default metric for comparing products. If a US made fixture has a higher lm/w than an imported fixture, it may be due to more advanced thermal management or more advanced and expensive diodes. If that is the case, the fixture will cost less to operate every month. It may cost a little bit more upfront but save more money over its life. The Total Cost of Ownership (TCO) may be lower with the US made LED fixture. Just as lm/w is a key factor in determining the lowest TCO, so too is lumens per dollar. Not all fixtures in the same “category” have the same output, so make sure to also compare what you get (lumens) for what you spend (dollars).

Warranty and TCO: Lumens per watt and lumens per dollar have a third sibling in determining the lowest Total Cost of Ownership (TCO) – Lumens per Dollar over the Warrantied life.  The length of the warranty is key, as is the coverage in the warranty language. If a Chinese LED fixture has a 5 year warranty, and a US fixture has higher quality components, better thermal management, and higher overall quality controls in the manufacturing process, then the total output in lumens will far exceed the import across the life of the fixture. Time is money, so if you do not have to spend the time re-installing a fixture in five years or buying a new fixture in five years, then the US made fixture just got a whole lot less expensive than the import.

Top Tip on LED Price Comparison: If you are in the market to change your existing lights to energy saving LED fixtures, or if you have new construction projects then take a careful look at the Lumens per Watt, Lumens per Dollar and Lumens per Dollar over the Warranties life…and not just the price of the fixtures. If you are an Electrical Contractor or Value Added Reseller (VAR) providing lighting solutions, then make sure to compare the prices and the warranties, beyond just the length of the warranty coverage. If you are a lighting designer or architect, take a hard look at US LED manufacturers before making an assumption that US products are more expensive than imported Chinese LED fixtures.

In our last post, Hugo da Silva argued that cutting-edge LED applications demand cutting-edge LED materials. While this is an accurate statement, its counterpoint is also true: Advances in LED materials can help to advance LED applications.

This is evident in two coinciding trends: The accelerating adoption of high refractive index (RI) LED encapsulants based on phenyl silicones, and the increasing application of LEDs in general lighting.

To be clear: There are other, independent trends driving adoption of LEDs in general lighting applications – most notably, the strong worldwide demand for more efficient light sources. Currently, lighting consumes nearly 20 percent of global electrical generation, and accounts for almost 6 percent of worldwide greenhouse gas emissions, according to the en.lighten initiative. Governments around the world have responded by planning or implementing stringent regulations to promote more energy-efficient light sources, such as LED-based lamps and luminaires. Yet even as this opportunity beckons, it also puts greater demands on LEDs themselves to deliver more lumens per watt.

Meanwhile, there are only so many ways to incrementally improve the output efficiency of LED chips. And as LED chips approach their theoretical limits for efficient light output, every small improvement becomes increasingly capital intensive. This has prompted LED designers to consider alternative approaches to boosting output efficiency, which is where advances in LED encapsulants are playing a role.

As a class of optical materials, silicones have raised the bar for reliability, performance and cost in along the entire LED value chain. Yet not all optical-grade silicones perform equally. Although all share the same basic silicon-oxygen foundation, silicones fall into two distinct chemistries distinguished by the phenyl or methyl end groups distributed along the molecular backbone.

These chemical nuances have significant real-world implications for LED lighting manufacturers hoping to compete for a share of the general lighting market. Namely, the comparatively higher (1.54) RI of phenyl-based silicones translates into 7 percent greater light output – independent of the LED chip, case or input power. More importantly, this significant boost in LED output derives from a simple change in encapsulant materials, which is a highly cost-effective alternative to achieving a comparable improvement in LED chip performance.

Years ago, there was a perception among seasoned LED designers that phenyl silicones came with certain trade-offs in thermal stability. That is no longer the case. Advances in phenyl-based silicone chemistry now enable optical silicone encapsulants able to perform reliably in the latest generation of 5 W to 50 W chip-on-board LED architectures. In addition, phenyl-based silicone encapsulants offer comparatively higher mechanical strength and a stronger gas barrier than methyl products. This helps protect the silver electrodes inside LEDs against moisture and corrosion that can turn them black and degrade both their performance reflective properties.

More to the point, these advances in phenyl silicone technology come just in time to improve the efficiency, reliability and competitive value of LED lighting as it targets new applications emerging in today’s general lighting market.