Lighting-as-a-Service in China Trends and Forecast
The future of the lighting-as-a-service market in China looks promising with opportunities in the commercial, industrial, and municipal markets. The global lighting-as-a-service market is expected to reach an estimated $5437.2 million by 2031 with a CAGR of 35.6% from 2025 to 2031. The lighting-as-a-service market in China is also forecasted to witness strong growth over the forecast period. The major drivers for this market are the increasing global demand for lighting technologies that use less energy, substantial R&D efforts by major organizations in the field, and the rapid adoption of light-emitting diode (LED) technology for energy-efficient lighting.
• Lucintel forecasts that, within the installation category, indoor will remain a larger segment over the forecast period due to its widespread use for impactful displays in malls and retail centers, as well as the explosive expansion of the commercial sector in emerging countries.
Emerging Trends in the Lighting-as-a-Service Market in China
The LaaS market is rapidly changing due to China’s fast pace of urbanization and its emphasis on sustainability. Technologies have become significantly more sophisticated compared to before. In support of energy efficiency across the commercial, residential, and municipal sectors of China in its move towards becoming a greener country, LaaS becomes important. Among these emerging trends are key changing dynamics of LaaS across environmental, economic, and technological aspects in the China LaaS market:
• Integration with Smart Technologies: The Chinese LaaS providers integrate smart lighting systems with IoT technologies for better control, efficiency, and automation. In China, where smart technologies are increasingly adopted, the demand for integrated smart lighting solutions is surging. With IoT, LaaS providers offer connected smart lighting that maximizes energy usage, supplies real-time information, and has greater automation capabilities. The devices allow users to remotely control lights and set adjustments based on presence or ambient situations, thus significantly saving energy and bringing efficiency to their operations. In the LaaS market, the smart lighting system is another major trend revolutionizing the landscape in China.
• Government Policy Support for Renewable Energy: The Chinese government has adopted several initiatives for green energy, which have created further demand for LaaS solutions. The Chinese government has placed significant emphasis on environmental sustainability. It is offering many incentives and policies for the adoption of energy-saving technologies, such as LaaS. Government subsidies and favorable regulations are motivating businesses and municipalities to adopt energy-efficient solutions in lighting to reduce energy consumption and support national sustainability goals. This is one of the driving forces behind the growth of the LaaS market, facilitating easier transitions by businesses and public institutions to sustainable lighting solutions.
• Moving Towards Renewable Energy-Based Lighting: Renewable energy is increasingly included in LaaS solutions offered across China. LaaS providers are also embracing renewable energy sources, including solar power, in lighting solutions in line with China’s clean energy commitment. Solar-powered lighting solutions reduce dependency on the grid and the associated energy costs while supporting environmental sustainability. One of the emerging trends is the integration of renewable energy in LaaS solutions. This allows organizations to adopt off-grid, self-sufficient lighting systems, which may be useful for remote or underserved areas. This helps reduce carbon emissions and supports the green energy targets of China.
• Urbanization and Smart City Projects: With rapid urbanization and smart city projects, there is a high demand for scalable and efficient lighting systems in China. The rapid urbanization of China is generating a demand for smart, scalable, and energy-efficient lighting solutions. As the concept of smart cities rises, municipalities are adopting LaaS models to deploy intelligent lighting systems that can be easily integrated with other urban infrastructure. Such systems offer benefits such as enhanced security, lower energy consumption, and improved traffic management. A major trend driving the growth of the LaaS market in China is the focus on making smarter, more sustainable cities, which aligns with national urban development goals.
• Subscription-Based Business Models: The rise of subscription-based payment models is making LaaS more accessible to a wide range of businesses in China. Subscription-based business models are gaining popularity in China. Companies can now tap into high-end lighting solutions without making significant upfront investments. This model allows businesses and municipalities to spread the cost of installation and maintenance over time, making it much easier to invest in energy-efficient lighting systems. SMEs as well as government departments, being less capitalized, are also attracted to the variable nature of subscription models. This is expected to bring more LaaS solutions adoption across various industries in China.
The emerging trends such as smart technology integration, government support for sustainability, renewable energy-powered lighting, urbanization, and smart city initiatives, as well as subscription-based models, are shaping the LaaS market in China. They are driving demand for more sustainable, efficient, and flexible lighting solutions that support the country’s environmental goals and urban development strategies. The Chinese LaaS market is undergoing rapid growth due to these trends, promising an energy-efficient, smart, and sustainable lighting landscape across the nation.
Recent Developments in the Lighting-as-a-Service Market in China
The lighting-as-a-service market in China has been rapidly developing over the past few years, influenced by technological innovation, changes in regulations, and a greater emphasis on sustainability. These developments have driven the growth of the market, allowing businesses and municipalities to embrace more efficient and cost-effective lighting solutions. Some of the key recent developments in China’s LaaS market are as follows:
• Smart Street Lighting Systems: Smart street lighting systems are increasingly being adopted in Chinese cities due to urban development and government support. Chinese cities are increasingly adopting smart street lighting systems to enhance energy efficiency and improve urban management. These systems integrate sensors and IoT technology to optimize street lighting based on traffic flow, weather conditions, and time of day. The development of smart street lighting is supported through government policies aimed at sustainability and energy efficiency. This trend promotes the growth of LaaS in China due to municipalities needing cost-effective as well as energy-efficient lighting for streets and other public areas.
• Rolling out Green Lighting Initiatives: Several cities in China are introducing green lighting initiatives to reduce carbon emissions and meet environmental targets. In response to growing environmental concerns, Chinese cities are launching green lighting initiatives that promote the use of energy-efficient lighting systems. These initiatives focus on reducing energy consumption and carbon emissions by encouraging the adoption of LED lighting and other sustainable technologies. The increasing focus on green lighting is driving demand for LaaS solutions, as they allow cities and businesses to adopt energy-efficient lighting without heavy capital investments. This trend is expected to increase as China is committed to increasing its environmental sustainability in development plans.
• IoT-Enabled Lighting Systems Advancements: IoT-enabled lighting solutions are developing in China and helping businesses remotely monitor and manage lighting systems. IoT-enabled lighting systems are becoming one of the key developments in the LaaS market due to the increased use of IoT in China. These systems enable users to remotely monitor and control lighting, facilitating easy optimization of energy use, lower maintenance costs, and improved efficiency. The integration of IoT technology is transforming the LaaS market by providing far more complex features and flexibility in lighting solutions. The demand for IoT-enabled solutions will increase rapidly as businesses and municipalities seek smart lighting systems.
• Funding Programs for LaaS Projects: Funding and incentives offered by the Chinese government to support energy-efficient lighting solutions across industries. As part of the push for sustainability and energy efficiency, the Chinese government has introduced various funding programs and financial incentives for LaaS projects. Such initiatives ease the transition for businesses, municipalities, and industrial sectors to adopt energy-efficient lighting solutions without significant upfront costs. Through subsidies and grants, the government is propelling the growth of the LaaS market and encouraging the mass adoption of energy-saving lighting systems in both public and private sectors.
• Expansion of LaaS in Industrial and Commercial Sectors: There is a growing demand for LaaS solutions in the industrial and commercial sectors in China, particularly in large manufacturing facilities and retail spaces. The industrial and commercial sectors in China are increasingly adopting LaaS solutions to reduce energy costs and improve lighting efficiency. Energy consumption is a significant operational cost for industries and businesses, which is reduced by LaaS. More specifically, large manufacturing plants and retail stores have adopted LaaS to improve their lighting solutions. They will save money over the long run and become more sustainable. It is one of the reasons for the growth of the LaaS market in China, where various sectors can realize the advantages of energy-efficient lighting solutions.
Recent developments in China’s LaaS market, including the growth of smart street lighting, green lighting initiatives, IoT-enabled lighting systems, government-backed funding programs, and expansion in industrial and commercial sectors, are greatly impacting the market. These developments are driving the transition to more sustainable, energy-efficient, and smart lighting solutions, supporting China’s environmental goals and urbanization efforts. The LaaS market in China is poised for continued growth as these developments reshape the lighting landscape in the country.
Strategic Growth Opportunities for Lighting-as-a-Service Market in China
The Lighting-as-a-Service (LaaS) market in China is experiencing significant growth as the country moves toward more energy-efficient and smart technologies. With increasing urbanization, sustainability goals, and a push for greater technological integration, the LaaS model provides flexible and scalable lighting solutions for various applications. The following key growth opportunities present a bright future for the LaaS market in China, tapping into urban, industrial, and governmental sectors.
• Smart City Applications: The development of smart cities in China presents an enormous opportunity for LaaS providers. The growth of China’s smart city initiatives has led to a high demand for intelligent lighting solutions. LaaS plays an essential role in providing scalable and energy-efficient lighting systems for cities. These systems incorporate smart technology, enabling cities to optimize their lighting based on real-time data, such as traffic and weather conditions. Smart city projects promote safety, sustainability, and cost efficiency. This creates demand for LaaS in public infrastructure and urban planning. The growth opportunity is reshaping urban lighting across China.
• Government Projects and Public Infrastructure: Government-led initiatives for sustainable development are driving the adoption of LaaS in public spaces. The Chinese government is actively investing in sustainable infrastructure, including energy-efficient lighting systems. LaaS solutions are well-suited to meet the lighting needs of public spaces, such as roads, parks, and government buildings. These systems help reduce operational costs and carbon emissions, aligning with China’s long-term sustainability goals. Government projects represent a prime opportunity for LaaS providers as both central and local authorities continue implementing policies encouraging energy-efficient technologies in public infrastructure, driving market growth.
• Retail and Commercial Sector: The retail and commercial sectors in China are increasingly adopting LaaS for energy-saving benefits. With the growing emphasis on energy efficiency, commercial buildings such as shopping malls, offices, and hotels are exploring LaaS solutions. These businesses can save significantly on lighting costs through flexible, subscription-based models that reduce upfront investments. The advantage of not owning or managing infrastructure allows businesses to maintain and upgrade lighting systems, benefiting from the latest technologies. LaaS providers are capitalizing on this demand by offering businesses a way to meet sustainability targets and improve operational efficiency.
• Industrial Applications: LaaS is being implemented in industrial facilities to optimize energy consumption and reduce operational expenses. In manufacturing and industrial industries, the need for energy-efficient lighting solutions is becoming more crucial. LaaS provides a way for industries to save energy without upfront capital expenditures. With the pay-per-use model, factories and warehouses can maintain lighting systems without owning the equipment. This trend is gaining momentum as industries seek more sustainable operations and improved energy management. LaaS for industrial applications supports both cost-saving and environmental goals, contributing to China’s push for greener manufacturing practices.
• Renewable Energy Integration: The integration of renewable energy into LaaS systems offers expansion opportunities, especially in off-grid areas. China’s push for renewable energy adoption opens opportunities for integrating solar power and other sustainable energy sources into LaaS offerings. Solar-powered lighting systems are gaining popularity, particularly in rural and remote areas. These solutions reduce reliance on the grid and provide sustainable lighting options. LaaS is integrating renewable energy in its offerings to help meet sustainability goals and support China’s broader green energy objectives. This trend could redefine energy consumption in off-grid locations.
The strategic growth opportunities in China’s LaaS market are significantly altering the landscape, focusing on smart cities, government projects, retail, industrial uses, and renewable energy integration. These opportunities help China achieve its sustainability objectives, enable technological innovation, and allow diverse sectors to adopt more energy-efficient and cost-effective lighting solutions. Increased demand in these areas will likely lead to the widespread use of smart and sustainable lighting systems in urban, commercial, and industrial applications, resulting in a greener and more efficient future.
Lighting-as-a-Service Market in China Driver and Challenges
The Lighting-as-a-Service (LaaS) market in China is driven by several factors, including technological advancements, government regulations, and economic pressures. However, there are also challenges related to market maturity, competition, and the pace of adoption. These factors shape the opportunities and limitations within the market. The following drivers and challenges highlight the evolving dynamics in China’s LaaS industry.
The factors responsible for driving the Lighting-as-a-Services market in China include:
• Technological Advancements: Smart lighting and IoT technologies remain major drivers in the LaaS market. IoT and smart technologies advance with each innovation. There is an increasing demand for connected lighting systems, allowing users to control and monitor their lighting remotely. These technologies help reduce energy costs by being more energy-efficient. The establishment of smart cities and urban development in China continues to fuel this trend. Technological innovation is rapidly enhancing the performance of LaaS offerings and making them more acceptable to customers across the commercial, industrial, and public sectors, who demand advanced lighting services.
• Government Policies and Regulations; Favorable government policies support the adoption of energy-efficient lighting solutions. The Chinese government has been a strong promoter of energy efficiency and sustainability. The government has implemented various policies that reduce carbon emissions and encourage the adoption of renewable energy sources. These initiatives are creating favorable conditions for the growth of the LaaS market. The government’s focus on sustainable urbanization and green energy is driving demand for energy-efficient lighting systems. Incentives, subsidies, and regulations that encourage the adoption of LaaS models help businesses and municipalities overcome the initial investment barriers associated with traditional lighting systems.
• Cost Reduction and Operational Efficiency: With increasing pressure in both the private and public sectors to drive down operating costs, LaaS is gaining acceptance. LaaS enables businesses and government agencies to significantly reduce capital expenditures by switching to subscription-based models. This reduction in capital costs is particularly appealing in China’s growing commercial and industrial sectors. Medium- to long-term operational cost savings also arise from the energy-efficient lighting systems that use LaaS solutions, reducing maintenance costs. With the persistent rise in energy prices and a focus on managing profitability, the financial benefits of LaaS are becoming another important driver of market adoption.
• Environmental Sustainability Goals: China’s carbon emission reduction commitment and clean energy promotion are driving LaaS adoption. China has set a target of achieving carbon neutrality by 2060, and the LaaS market will play an integral role in this vision. Switching to energy-efficient lighting systems will reduce energy consumption and carbon emissions, aligning with China’s environmental goals. Businesses and municipalities are increasingly adopting LaaS to show their commitment to sustainability and contribute to green energy. The growing demand for sustainable solutions in China is catalyzing the market as LaaS gains acceptance in multiple sectors.
• Urbanization and Smart Cities Development: The rise in urbanization in China contributes to the necessity of scalable lighting solutions. As cities develop smart infrastructure, lighting becomes a crucial element in a larger smart framework that includes sensors, energy management tools, and real-time data monitoring. LaaS solutions provide a scalable option for municipalities seeking to implement energy-efficient lighting across large urban areas. The rapid pace of China’s urbanization and smart city development is increasing the demand for advanced lighting systems. Smart cities are accelerating the adoption of LaaS as cities need to optimize their management and energy consumption.
Challenges in the Lighting-as-a-Services market in China are:
• Competition and Differentiation Challenges: Growing competition in the LaaS market creates challenges for providers. With the rapid growth of the LaaS market in China, competition among providers is increasing. More companies are offering the same solutions, making it difficult for providers to differentiate themselves. To stay competitive, companies must offer innovative features, better customer service, and cost-effective pricing. While the market holds strong growth potential, providers must continually innovate to maintain a competitive edge. The rise in competition could also lead to price pressures, potentially reducing profit margins and limiting growth for some providers.
• Slow Adoption in Rural Areas: The adoption of LaaS in rural areas is slower due to limited infrastructure and high initial costs. While urban centers in China are rapidly adopting LaaS, rural areas face challenges in embracing this model. Limited infrastructure and high installation costs prevent many rural regions from transitioning to energy-efficient lighting systems. A lack of awareness about LaaS and the complexity of installation in remote areas also contribute to slower adoption. Tailored solutions and government initiatives will be needed to promote LaaS adoption in rural areas. Until then, the LaaS market in rural China will remain a smaller segment compared to urban areas.
• Technological Integration and Compatibility Issues: Integrating LaaS systems with existing infrastructure can be challenging. The main challenge with new LaaS technologies is their compatibility with older infrastructure. In many cases, older lighting systems are not compatible with smart technologies and need to be upgraded or replaced. This integration issue results in higher initial costs and longer implementation times. Companies need to work on seamless integration solutions to overcome these barriers and allow businesses and municipalities to adopt LaaS without significant technological challenges.
The major drivers of the LaaS market in China are technological advancements, government policies, cost reduction, sustainability goals, and urbanization. However, challenges such as market competition, slow adoption in rural areas, and integration issues will hinder full market penetration. The LaaS market in China is still expected to grow as more businesses and government entities embrace energy-efficient and sustainable lighting solutions.
List of Lighting-as-a-Service Market in China Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies, lighting-as-a-service companies cater to increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the lighting-as-a-service companies profiled in this report include:
• Company 1
• Company 2
• Company 3
• Company 4
• Company 5
• Company 6
• Company 7
• Company 8
• Company 9
• Company 10
Lighting-as-a-Service Market in China by Segment
The study includes a forecast for the lighting-as-a-service market in China by installation, component, and end use.
Lighting-as-a-Service Market in China by Installation [Analysis by Value from 2019 to 2031]:
• Indoor
• Outdoor
Lighting-As-A-Service Market by Component [Analysis by Value from 2019 to 2031]:
• Luminaries and Control Equipment
• Software and Communication Systems
• Maintenance Services
Lighting-as-a-Service Market in China by End Use [Analysis by Value from 2019 to 2031]:
• Commercial
• Industrial
• Municipal
• Others
Features of the Lighting-as-a-Service Market in China
Market Size Estimates: Lighting-as-a-service in China market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends and forecasts by various segments.
Segmentation Analysis: Lighting-as-a-service in China market size by installation, component, and end use in terms of value ($B).
Growth Opportunities: Analysis of growth opportunities in different installation, component, and end use for the lighting-as-a-service in China.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the lighting-as-a-service in China.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
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FAQ
Q1. What are the major drivers influencing the growth of the lighting-as-a-service market in China?
Answer: The major drivers for this market are increasing demand worldwide for lighting technologies that use less energy, substantial R&D efforts carried out by the major organizations in the field, and quick adoption of light-emitting diode (LED) technology for energy-efficient lighting.
Q2. What are the major segments for lighting-as-a-service market in China?
Answer: The future of the lighting-as-a-service market in China looks promising with opportunities in the commercial, industrial, and municipal markets.
Q3. Which lighting-as-a-service market segment in China will be the largest in future?
Answer: Lucintel forecasts that indoor will remain the larger segment over the forecast period because it is widely used for impactful displays in malls and retail centers, and commercial sector’s explosive expansion in emerging countries.
Q4. Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 10 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the lighting-as-a-service market in China by installation (indoor and outdoor), component (luminaries and control equipment, software and communication systems, and maintenance services), and end use (commercial, industrial, municipal, and others)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.4. What are the business risks and competitive threats in this market?
Q.5. What are the emerging trends in this market and the reasons behind them?
Q.6. What are some of the changing demands of customers in the market?
Q.7. What are the new developments in the market? Which companies are leading these developments?
Q.8. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.9. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.10. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
For any questions related to Lighting-as-a-Service Market in China, Lighting-as-a-Service Market in China Size, Lighting-as-a-Service Market in China Growth, Lighting-as-a-Service Market in China Analysis, Lighting-as-a-Service Market in China Report, Lighting-as-a-Service Market in China Share, Lighting-as-a-Service Market in China Trends, Lighting-as-a-Service Market in China Forecast, Lighting-as-a-Service Companies, write Lucintel analyst at email: helpdesk@lucintel.com. We will be glad to get back to you soon.