Cree says its new LEDs will cut lighting costs 40 percent

Cree is launching new LEDs that it boasts will reduce the cost of LED lighting fixtures by up to 40 percent.

“It is world-leading technology at every level,” said Mike Watson, vice president of product strategy.

The Durham-based company also says its new SC5 Technology Platform, a combination of technologies that spawned its latest LEDs, will be incorporated into its own next-generation LED bulbs, which are expected to be available soon. Cree currently makes the top-selling LED bulbs, which are sold exclusively by Home Depot, and says its upcoming LED bulbs will be cheaper and provide better light.

Cree believes its new technology platform will accelerate the adoption of LED lighting, which is a small but fast-growing segment of the lighting market. LED lights cost more up-front but are cheaper in the long run because they last much longer and use less energy.

Cree plans to announce Thursday that the first of its new XHP (extreme high power) LEDs are now available in sample quantities for its commercial customers. Cree makes LED light bulbs and indoor and outdoor light fixtures as well as components other companies use in LED lights. Its LEDs also illuminate mobile phones, televisions, electric signs and car dashboards.

The new technology platform developed by Cree researchers in Durham and the new LED chips are being manufactured locally. As of Oct. 1, Cree had 2,613 employees locally and 7,073 worldwide.

The new LEDs will feature double the lumens on a single LED compared to what was previously the company’s brightest LED. Lumens are a measurement of a light’s brightness.

In addition to the extra brightness, the new LEDs incorporate a host of other features that will drive down the costs of the other components of LED lights – such as heat sinks that dissipate the heat, the lens that directs the light and the electronic drivers that turn lights on and off and enable dimming.

For example, the LEDs work reliably at a higher temperature, which enables less costly heat sinks. And having more light per LED permits using a smaller lens.

Falling prices

Reducing the cost of these other components is crucial, Watson said. The reason: Although LEDs used to be the most expensive piece of an LED bulb or light fixture, LED prices have declined to the point that they now represent 30 percent to 35 percent of a lighting system’s total cost.

So although the cost of the new XHP LEDs is roughly the same on a per-lumen basis, the total cost of a lighting system can be reduced by up to 40 percent.

“Our competitors, all they offer is incremental lowering of LED costs because they’re not dealing with the entire system,” Watson said. “The people who make bulbs ... who make fixtures are demanding continual, dramatic system cost savings.”

In addition, Watson said, “getting that amount of light that can operate at that high a temperature in that small a space allows designers to come up with really creative new designs that may not have existed before. We are opening up the design possibilities as well.”