LED technology and market challenges addressed in Taiwan

SEMI Taiwan

TAIWAN: With increasing awareness of global climate change and the importance of energy conservation, more and more countries have launched LED lighting projects and subsidy policies. As a result, even though the growth of the LED market in 2012 was hampered by global economic challenges, overall demand has continued to be on the rise.

To help the Taiwan LED industry tackle the increasing challenges, an in-depth analysis of LED global market opportunities and technology breakthroughs were recently provided at the "2013 LED Market and Outlook" seminar held by SEMI Taiwan.

During the seminar, Carson Hsieh, VP of EPISTAR Corp., mentioned that the LED applications have now expanded beyond backlight modules to include general lighting. Demand for high-power white LED is now growing at a rapid pace.

Yellow and natural light LEDs will both exceed 200 lumen/watt in power rating by 2015 and even surpass 250 lumen/watt by 2020. OEM bulb prices are expected to drop from $23 per 1,000 lumen in 2012 to $10 per 1,000 lumen in 2015 and then down to $5 per 1,000 lumen by 2020. The next few years will therefore see strong growth in the LED lighting market.

LED lighting market continues to grow from 2011 to 2016, with 45 percent CAGR
Daphne Kuo, an analyst with ITRI Industrial Economics & Knowledge Center, added that the global market for general lighting has an annual growth rate of between 3 and 6 percent.

The global market is expected to be worth $114.7 billion in 2020, with the LED lighting market reaching a compound annual growth rate of 45 percent between 2011 and 2016, and 15 percent between 2016 and 2020. The LED lighting market could therefore reach a value of $79 billion.

In terms of the LED lighting market structure, LED home lighting will be the largest market in 2020 at $32.1 billion accounting for 41 percent of the total LED lighting. The next two largest markets will be outdoor and office lighting, with both approaching $11.3 billion. The overall market will itself be divided into the new installation market and the replacement market (i.e. lighting fixture is retained and only the internal lamp is replaced).

The relative scale of the two markets is approximately 80:20. The scale of the replacement market is however expected to begin contracting after 2015 as LED penetration increases and lighting technology improves.

Different regions, different approaches
Kuo also analyzed the differences in regional development within the global general lighting market. According to Kuo, currently Western nations account for 50 percent of the general lighting market and the Asian market accounts for 40 percent, so these two large regional markets remain evenly balanced. However, future growth will be driven mainly by emerging nations, and the BRICs in particular, because of strong government support for LED lighting.

China will be the largest among them and account for approximately 70 percent of the BRIC lighting market. As China is also accelerating the pace of urbanization, its domestic market is very large as well. The China market is estimated to account for 45 percent of all demand in Asia, or 18 percent of the global lighting market.

Nevertheless, demand for LED lighting in China mainly comes from government projects.. With local firms and governments joining forces to protect their vested interests, it is very difficult for outside firms to make any headway. Any company wishing to enter the China market must therefore pay attention to the parochial nature of the lighting market. Adopting a profit sharing model and establishing a solid partnership with regional lighting channel operators is essential when entering the LED lighting market in China.

Keys to increase market: Lower production cost and improve efficiency
In addition to the market challenges there will also be a number of technological challenges in the future. EPISTAR's Carson Hsieh noted that solving problems with thermal resistance remains the number one priority. The current trend is using Flip-Chip technology to reduce chip-level thermal resistance. Another approach is to improve light emission efficiency.

Light emission efficiency is in turn governed by internal quantum efficiency and light extraction efficiency. While improvements have been made in internal quantum efficiency, factors such as material absorption, uneven current distribution, and threshold loss mean that even high internal quantum efficiency within the LED produces relatively little external light. The bottleneck in LED light extraction efficiency must therefore be overcome.

Hsieh went into further details on derivative developments and talked about the use of crystal growth on sapphire substrate for high-brightness LED. The current tend is using Patterned Sapphire Substrate (PSS) technology as it has the advantage of increasing LED light extraction efficiency. Another method, called Nano Patterned Sapphire Substrate (NPSS), not only increases light extraction efficiency but also boosts epi wafer output.

Increasing light extraction efficiency will not only boost overall light emission efficiency, but also reduce thermal loss, allowing LED bulbs to do away with heat sinks and reduce costs even more.

By using GaN LED on Si technology to grow the epi layers on large silicon wafers, it will also be possible to adopt a production process that is compatible with semiconductor production lines and significantly reduce overall costs as well. However, GaN has a far higher thermal expansion coefficient than silicon so this may lead to technical problems such as epitaxial film rupture or wafer warping that will need to be overcome in the future.

Technology breakthroughs lead to further reductions in LED costs. This will in turn increase market acceptance and usher in of the era of high growth for the LED lighting market.