By 2020, the total potential market for efficient lighting will grow from the current value of 1.6 billion euros to 3.3 billion. A 106 per cent increase which, according to industry operators, will deliver enormous savings in terms of energy costs and environmental impact. To achieve this result, however, it is necessary to set in motion a virtuous mechanism built on information and simplification.

These are some of the findings that emerged from the Efficient & smart lighting report drawn up by the Energy&Strategy Group of the School of Management at the Politecnico di Milano, which sheds light on the potential and the business models that characterise the lighting market — from public lighting to residential, office, industrial and commercial buildings. Currently, LED lighting accounts for 5 per cent of total electricity consumption, a figure that could reach 26 per cent within a few years, thereby meeting the energy efficiency targets that Italy and Europe have set themselves under the 20-20-20 package.

A third of electricity saved

"Efficient and smart lighting" refers to the combination of two components: efficient lighting that, through the use of LEDs, guarantees lower energy consumption for the same level of performance, and smart lighting that, through hardware and software solutions, monitors and controls the use of light sources, maximising their effectiveness as well as their energy efficiency. According to the report, the potential market by 2020 can be broken down into 2,032 million euros when looking solely at LED light sources (+40 per cent compared with the expected market) and 1.3 billion euros (representing a boom of 580 per cent compared with expectations) when smart solutions are taken into account.

"Lighting in its various forms is responsible each year for over 32 TWh of electricity consumption and is above all an indispensable component of comfort in any building," explains Vittorio Chiesa, Director of the Energy&Strategy Group, in the report. According to him, by 2020 it could be possible to save over 10 TWh of electricity consumption: "However, the awareness among system owners is still too low — a lack of awareness that risks causing the loss of over 1.6 billion in market value and which therefore needs to be addressed."

Timescales and red tape the main obstacles

The lead times involved in carrying out interventions represent a brake on development. Leaner procedures and greater openness to mixed public-private financing arrangements or the use of advanced contractual forms such as EPC could decisively accelerate market development.

There is no need for ad hoc financial incentives, since in most cases the interventions are already covered by regulations on energy saving in buildings. Nevertheless, targeted measures — for example, extending to legal persons the tax benefits currently available to natural persons for energy efficiency improvements to lighting systems, or granting VAT concessions to public administrations — could, through their promotional effect, act as a catalyst and help spread awareness of the true market potential of efficient & smart lighting.