Bright Future: The Evolving LED Lighting and Controls Industry

­The LED lighting market continues its transformation into 2025. Once a niche alternative to traditional incandescent and fluorescent lighting, the more-efficient, longer-life, lower-cost LED (light-emitting diodes) now dominates global lighting applications. The LED lighting and controls market is estimated to exceed $155.70 billion by 2032, up from $84.46 billion in 2024. It’s projected to be $89.70 billion in 2025, with a 2025-2042 CAGR growth of 8.7%, according to a recent Consegic Business Intelligence report.

A big force shaping the LED market is governmental policy, with countries phasing out inefficient lighting in favor of LEDs. In the U.S., energy codes like California’s Title 24 and federal efficiency standards push commercial and residential buildings toward LED retrofits. Globally, countries from the E.U. to Asia are investing in large-scale LED deployment in public infrastructure.

Another major driver is innovation. LEDs are no longer just bulb replacements; “smart” LED solutions are integrated into building automation platforms and are controlled via mobile apps, voice assistants or centralized systems. Many of the newer LED lighting products are programmable and have every feature imaginable, including multiple interface standards. Features like tunable color temperature, occupancy sensing, daylight harvesting and networked controls enhance both user experience and energy savings. And with the rise of the Internet of Things (IoT), connected lighting is becoming a standard feature in new construction and high-end renovation.

Accessibility to the consumer market is also causing a rise in demand. LED bulbs that cost over $20 are now often less than $2, while touting lifespans of 15 to 25 years, although I find that LED lamps don’t last this long, especially in outdoor sealed fixtures.

The challenge is that the lighting market is a race to the bottom. Low cost is especially a factor in the low-end residential segment, placing pressure on manufacturers to differentiate through innovation and performance. In a previous role, I helped orchestrate a tactical retreat from the LED lighting market since we simply couldn’t compete with suppliers in Vietnam, China and Taiwan on costs or the pace of feature/technology. Meanwhile, users are concerned about product quality and reliability being less than advertised. Moreover, expectations of warranties of seven years plus make the risk of the market even more brutal.

The next phase of LED growth will likely focus on emerging applications and integration, such as smart cities, agriculture and human-centric lighting controls such as those supporting circadian rhythms. LEDs for sensors are expanding the market’s reach into healthcare, security and instrumentation applications.

In summary, today’s LED lighting market goes beyond energy savings—it’s a platform for digital transformation, sustainability and new applications and ways of thinking about the possibilities of light. Expect more, pay less. Wash, rinse, repeat.