As telephones have evolved into handheld computers capable of searching the internet, playing and shooting videos, and myriad other functions, a similar type of innovative transformation is beginning to occur with the lightbulb. In particular, modern light-emitting diode (LED) lighting systems are evolving from being simply an energy-efficient source of light to becoming a sophisticated network of sensors and software capable of capturing, transmitting, and analyzing vast amounts of data about the movements and even the habits of people. It amounts to a fundamental rethinking of lighting.
“Lighting is becoming a commodity. It has the opportunity to evolve into a services business, turning lighting into a strategic asset,” says Ran Ryan, chief executive officer of ByteLight, an LED lighting software company in Boston.
The newest LED “smart light” fixtures can be equipped with motion, photo, audio, environmental, and water sensors, along with a small computer processor, making them capable of counting and collecting data about actions, temperatures, humidity, carbon dioxide levels, rainfall, wind, and other conditions. In real estate, wireless LED sensor networks are cropping up on streetlights in Las Vegas, at commercial parking lots in California, throughout a public park in Chattanooga, Tennessee, inside an airport terminal in Newark, New Jersey, and as an entirely new strategy for in-store retail marketing.
Shorenstein Realty Services, a San Francisco–based commercial property owner and manager, retrofitted 80 pole lights to LED controls on a parking deck between two office towers in Santa Clara, California. The system includes wireless video cameras to monitor the garage’s entrances, plus a sensor network that dims the lights at night during unoccupied periods but can identify a person walking to a vehicle and then brighten the lights along his or her path. Shorenstein has been able to save thousands of dollars through an 86 percent reduction in the garage’s energy consumption, leading to an expected three-year return on investment. So now the company is looking to add LED networks at more of its properties that have surface parking lights, and possibly expanding the sensor capabilities to monitor parking space use.
“It could really change the way we do business in the future,” says Kevin Kirk, Shorenstein’s manager of engineering services.
Last year, global lighting giants Philips and General Electric each introduced a retail-oriented lighting system. Through sensors and a wireless network, the system can communicate with shoppers who download a special app, then it can send them targeted promotions for products they are looking at or standing near. Once a shopper opts into the service, the LED sensor network collects positioning information from his or her smartphone, then can instantly transmit data to the smartphone app with coupons or other special offers.
This innovation has piqued the interest of Edens, a national shopping center developer based in Columbia, South Carolina. Edens has begun talking with General Electric about ways to connect shoppers to all of the stores in a given center. “The possibilities are incredible,” says Gregg Edelstein, the vice president of property management for Edens. “It’s going to be a game-changer.”
Overall, some companies and properties that have switched to LEDs or which are contemplating doing so cite a host of benefits that LED network control systems can offer:
- Public safety—for detecting suspicious activity, responding to emergencies, and even recognizing license plates;
- Asset management—for uses such as notifying drivers of available parking spots or tracking the movements of boxes in a warehouse;
- Environmental monitoring—for measuring temperatures, greenhouse gases, and even earthquake vibrations; and
- Retail analytics—from individualized marketing promotions to deciphering trends in customer activities.
Then, of course, there is the energy efficiency of LED technology. Lighting accounts for 17 percent of electricity consumption in residential and commercial real estate, according to the U.S. Energy Information Administration, and streetlights can represent as much as one-third of a municipality’s energy costs, according to industry estimates. But LED bulbs use just 15 percent of the electricity of incandescent bulbs, and LEDs last ten years or more, which is three to five times longer than incandescent bulbs last. So the U.S. Department of Energy estimates that LEDs have the potential to cut in half the amount of electricity used in lighting.
Put it all together, and LEDs are joining what has been dubbed the “internet of everything” or the “internet of things,” a broader trend of smart-city sensor technologies for communicating with and managing all sorts of networked devices and services.
Advantages of LEDs
Sensors themselves are not new. Some luxury automobiles now include sensors that can automatically apply the brakes in an emergency. Some bridges use sensors to collect data about road conditions, traffic loads, and even corrosion of the bridge’s components.
Sensors are not new in lights, either. Modern offices use sensors to detect motion and turn lights on or off when people enter or leave a room. Such sensors can be included in any kind of light, whether it is metal-halide, fluorescent, or LED. “But LEDs will end up really driving the controls market,” says Jesse Foote, a research analyst on lighting for Navigant Research.
Why LEDs? Because it is easier to connect sensors and devices to them, so it costs less to run networked controls through LEDs than other lamp types. LEDs can be as small as a pinhead, and they form a semiconductor chip that can convert electricity into light. In short, every LED is a mini microprocessor, and some LED fixtures now come with standard sensors mounted on a circuit board that can detect motion, gauge air quality, and even measure the power consumed. Additional connections can add a camera through a round lens on the underside of the fixture housing. Wireless internet connectivity can be achieved through a cell modem, through building wi-fi, or through a fiber cable hooked to one of the networked lights.
“The LED is a Trojan horse. It’s carrying a more valuable package—all the devices and applications that are the real important things,” says Hugh Martin, chief executive officer of San Jose, California–based Sensity Systems, one of the trendsetters in LED sensor systems.
A couple of trends are driving the LED transformation. First, LED prices continue to fall, making the lamps more competitive with alternatives. In 2010, a 12-watt LED bulb—equal to a 60-watt incandescent lightbulb—cost $40. By 2013, the price was down to $20, and now the latest generation can be bought for $10. Similarly, LED streetlights are now marketed for less than $100.
Second, government regulations are requiring more energy-efficient buildings and phasing out incandescent bulbs, clearing out market competition for LEDs. The American Society of Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE) 90.1 code has become a standard in two-thirds of U.S. states, with the 2010 version requiring occupancy sensors and photosensors in many interior spaces. In addition, California’s 2014 update to its Title 24 Energy Efficiency Standards requires occupancy sensors and controls in interior open spaces and even aisles of most buildings, as well as in parking garages and loading docks.
“California is very aggressively pushing the envelope,” says Terry McGowan, director of engineering for the American Lighting Association, a manufacturers’ trade association based in Dallas. He notes, though, that it will take time for builders to adjust to the state’s changes.
With LEDs’ inherent advantages and favorable trends, industry experts foresee sales of lighting controls taking off during this decade, mainly for commercial buildings, since residential use of LED systems is still in its infancy. Technology research firm
Navigant predicts that the networked lighting controls market in commercial buildings will triple in the coming years, with global revenues jumping from $1.8 billion in 2013 to $5.3 billion in 2020, for an annual growth rate of 17 percent. Navigant believes that LED lamps are likely to be used in more than half of all global building retrofit projects by 2020, up from 5 percent in 2013.
Similarly, global consulting firm McKinsey forecasts that the lighting control components market in commercial buildings will grow by almost 20 percent annually, from approximately $2 billion in 2011 to $8.6 billion by 2020. “The market for lighting system control components is the fastest-growing value chain element in general lighting,” McKinsey reports.
At the beginning of this decade, Coolidge Park on Chattanooga’s downtown riverfront was becoming one of those places that adults avoided at night. After dark, youths gathered under the Walnut Street pedestrian bridge, and gang rivalries sometimes erupted into gunfire. The city was about to erect giant baseball field–like floodlights to flood the bridge area with light. But Don Lepard, chief executive officer of Global Green Lighting, then based in the city, convinced the government to try something else: a new series of LED lampposts in the park that could be controlled remotely to brighten, dim, or even flash the lights.
One night after the new lights were installed, Lepard went on a ride-along with a police officer patrolling the park area. With a laptop connected to the internet inside the patrol car, the officer could control the lights. So when the officer saw some youths congregating at the bridge, he tapped on his laptop and turned the lights near the bridge to flash mode. That sent the youths scurrying out of the park. Now the park is popular again after dark, even hosting prayer groups. “The lights give everyone a safer feeling,” Lepard says. “They basically reclaimed the park.”
That is just one of the cutting-edge applications emerging with LED sensor systems. Places ranging from the downtowns of Las Vegas and suburban Auburn Hills, Michigan, to such complexes as Chicago’s Navy Pier and Detroit’s Henry Ford Health System have installed streetlights that also act as emergency communications systems. The “Intellistreets” lights, from Farmington Hills, Michigan–based Illuminating Concepts, can include optional bomb sensors, digital signage, emergency calling capabilities, and speakers that can play mass notification messages. Or when no emergency exists, the LED system can play music, display advertising, or issue public announcements. Illuminating Concepts is now marketing the lights to the owners of health care campuses and big-box stores for use in parking lots.
“The real estate value of the light pole is changing,” says Michael Shulman, executive director for design and business strategy for Illuminating Concepts. “We are taking a light pole and producing entertainment and revenue off it.”
Meanwhile, Newark Liberty International Airport’s new LED fixtures above Terminal B include cameras that are connected wirelessly to a central hub monitored by security. According to the New York Times, the airport uses the video to spot long lines, watch unattended baggage, recognize license plates, and identify suspicious activity.
Elsewhere, Walmart last year installed General Electric’s LED fixtures in new supercenters across the Unites States as well as in stores in the United Kingdom, Asia, and South America. While Walmart promoted the deal as a way to save an estimated $34,000 annually in lighting costs per store, the company also has stated that it will incorporate “a variety of G.E. lighting technologies.” Some retail analysts have interpreted that to include shopping applications, using General Electric’s LED application that can communicate with shoppers’ smartphones. G.E.’s locational software is provided by Dan Ryan’s ByteLight.
Ryan says that retailers increasingly are looking for new ways to compete against the internet and entice shoppers to buy in their stores, and not just use the stores as showrooms where they can make price comparisons. “Three years ago, no one was returning our phone calls,” he says. “Now, retailers have expressed strong interest in locational technologies. It’s near the top of the list of technologies that retailers are looking at.”
Yet, as these new lighting technologies and services are emerging, some concerns are already being raised about privacy. In an age when web surfing is tracked by internet cookies and credit-card numbers can get hacked from stores, some people want to opt out of being tracked rather than to opt in. It is not surprising, then, that LED video and locational applications have drawn some criticism.
In the tech industry, the website of the Electronic Engineering Times ran an article last year with the headline, “Are LED Lights Spying on You?” When Illuminating Concepts’ Intellistreets were being piloted in Las Vegas, some local residents and out-of-town conspiracy websites raised alarms, calling them “big brother” surveillance lights that could watch and listen to what passersby were doing. Despite assurances from Las Vegas’s public works department that the lights were not being used to make video or audio recordings, an official with the American Civil Liberties Union of Nevada told the Las Vegas Sun, “The idea that they could be on the street eavesdropping to pick up conversations . . . seems like a privacy violation.”
So as the LED transformation advances and becomes more pervasive, real estate property owners must make sure they take privacy concerns into account. The retail locational systems, for instance, require a shopper to download an app and opt into their use.
“There is a constant tension between privacy and convenience,” says Tedrick Housh, chair of the data privacy practice at the Kansas City, Missouri, law firm Lathrop & Gage. “There is a call for more transparency and oversight over government intrusion into private lives. When it is a business, not government, collecting the information, it still comes down to trust and what an individual’s reasonable expectation of privacy is. Privacy is a malleable concept that will continue to evolve with technology.”
Jeffrey Spivak, a senior market analyst in suburban Kansas City, Missouri, is an award-winning writer specializing in real estate development, infrastructure, and demographic trends.