Health Benefits of LEDs Could Propel Lighting Controls Market Even Further

As more building owners and managers adopt LED lighting, local controls and sensors as a way to decrease energy costs, new research shows that the savings related to the health benefits of LED lighting might prove to be the biggest driver of all.

Dr. Jennifer Veitch, a psychologist and senior research officer at the National Research Council of Canada, has spent the past 15 years studying the way lighting impacts the health, well-being and productivity of employees working under illumination. At the recent Advanced Energy conference in New York City, Veitch explained that her team’s experiments have shown that when people think the lighting in the room they are in is better, they’re in a better mood, have fewer complaints and they rate their own performance at the end of the day higher than those who don’t like the lighting they’re working in.

In addition, when lighting is more attractive, as LED lighting tends to be, subjects in the experiments tended to be more satisfied with their workplace, which made them more productive and happier to be at work, explained Veitch at the Advanced Energy conference in New York this year.

“What people think about their lighting has beneficial outcomes for individuals and for organizations in terms of having people be more engaged in their work,” she said.

Veitch’s findings are interesting, but they have become even more so given the fact that the lighting controls market is undergoing major change.

A report from Navigant Research released at the end of August shows that the global market for lighting controls for commercial buildings is growing considerably and includes new buildings and retrofits. Building owners are demanding controls and sensors, and vendors are jumping to meet the new demands, reports Navigant.

“Demand for local controls such as occupancy sensors and photosensors, as well as networked controls, is on the rise as adoption rates of LED lighting begin to climb and controls technology improves and becomes less expensive,” states the executive summary of “Intelligent Lighting Controls for Commercial Buildings.” “Navigant Research forecasts that global revenue from networked lighting control equipment within commercial buildings will grow from $1.7 billion in 2013 to $5.3 billion in 2020.”

Much of the demand is driven by the need to reduce energy use and drive costs savings. However, there is a remains-to-be-seen dollar figure on the cost savings to employers and businesses regarding human capital and the lighting conditions in which people work. However, the cost benefits are, so far, nearly impossible to quantify.

Veitch said her team has unpublished data from an experiment in which employees had control over their lighting and were close to a window. Such employees were more satisfied with their work environment and had lower turnover and lower intent to leave their organization. Veitch said she realizes that lighting isn’t a solution for companies with high turnover, but is worth exploring further given the high cost and impact of turnover on an enterprise.

“Lighting is not the key for turnover problems for organizations,” said Veitch, but it’s worth paying attention to this because the lighting is cheap and the people who leave your organization are expensive to replace.”

In addition to greater feelings of well-being about their workplace, people in better lighting conditions tended to have fewer health problems and less reported time off. They also had less visual discomfort, she said.

Deborah Burnett, a principal at Benya Burnett Consultancy who spoke on a panel recently with Veitch, posited that energy efficiency in the traditional sense comes with its own cost savings, but these health benefits may present a different type of energy efficiency savings: those within humans themselves. Furthermore, as scientists connect the lighting conditions people work under to human biological functions, there will be better ways to understand the affects of better lighting on employees vis-à-vis the savings of energy efficient lighting, said Burnett.

“Lighting is the most cost effective and the most difficult to understand when you are trying to evaluate it from a human energy perspective,” said Burnett.

Innovative Venture Backed LED Lighting Companies

During a separate Advanced Energy conference panel, two innovative venture backed LED lighting presented their wares to investors and building managers, including:

Massachusetts-based Digital Lumens, which was founded in 2009 by ex-Philips Lighting employees, uses “big data” to create intelligent LED lighting systems for the industrial space. The company also rolled out a partnership program recently to integrate its software into LED systems built by other manufacturers.

Its lighting systems use remote optic sensors and incorporates demand response to produce “smart lights that are networked together, and centrally managed” said senior product manager Joseph Adiletta. Their systems generate substantial lighting energy savings, greater functionality and a higher quality light — “table stakes” for building managers, Adiletta claims. He says that their systems saved a recent customer 87% of its lighting energy with a payback in under one year.

Digital Lumens, who was named to the Cleantech Group’s 2012 Global 100 List, received a $10 million funding in January from existing investors including: Black Coral Capital, Flybridge Capital Partners, and Stata Ventures. That brings its total venture funding to over $26 million.

Enlighted, another innovative lighting company that develops sensors and controls and was also named to the 2012 Global Cleantech 100 List, received $20 million in a series C venture capital round in April from RockPort Capital, Kleiner Perkins Caufield & Byers, Draper Fisher Jurvetson, Intel Capital and DFJ JAIC.

Another company that presented at the conference was Austin-based Ketra, a maker of advanced lighting controls that uses a communication interface to control multicolor light source platform. The company was founded in 2009 and received venture funding by New Enterprise Associates.

According to Ketra’s V.P. of marketing Tom Hamilton, the key problem they were trying to solve is that building managers and lighting systems don’t currently “play well together.” He feels that their product solves this problem at the “holistic level”; its an easy to use wireless interface that enables lighting to be tuned to color and temperature and includes time and scheduling functions. They plan to launch their product this fall.

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