Market opportunities for lighting industry in western europe

Business from Innovative Use of Light:

Market Opportunities for Lighting

Industry in Western Europe

Risto Huhta-Koivisto Senior Consultant

Pekka Tolonen VP, West Europe & Africa

Time to grasp the business

opportunity

Examples of successful Finnish businesses

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Drivers of the Market Opportunity

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• Rising electricity prices in Western Europe is a continuous trend: Need to cut costs in energy consumption.

• Energy efficiency directives by EU create demand for new type of energy efficient solutions and expertise in lighting.

• Green city-type projects in most EU countries.

• State and municipal incentives to improve the energy efficiency.

Did you know: 8 billion light bulbs

will be changed to LEDs by the year

2020.

New Customers: Western Europe is a Booming

Lighting Market

• Development way ahead

compared to Finland.

• Demand for new lighting

technology and solutions in

innovative LED lighting e.g. in

architectural sights, hospitality

business and lighting regulating

human, animal and plant

biorhythms.

– Greenhouse business using

increasingly LED lights.

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Opportunities in Greenhouse Business

Greenhouse sector growth continues. Ongoing trend of energy efficiency,

sustainability and productivity opens up markets.

• Greenhouses offer a market not only for LED lighting but also for other

solutions in irrigation systems, cooling, ventilation and fertilization.

• Dutch sector, leader in Europe, is a forerunner: Growers are concerned about

continuous improvement and government is subsidizing business to promote

competitiveness and sustainability.

– Old greenhouses are replaced and updated: new technologies, business

process improvement e.g. supply chain integration and marketing is

needed.

The Dutch Greenhouse Market

• Horticultural market represents 4% of the Dutch economy, providing 24% of world supply. In added value Dutch sector outperforms global average by 50%.

• Greenhouses cover 0,5% ( around 10 500 ha) of arable land and produce 22% of agricultural output.

• Greenhouse growers, most SME’s, can control the factors affecting yields and quality. Growing essentially 12 months/year.

• Dutch are excellence driven by technology and infrastructure.

– Grower’s associations

– Logistical Hubs

– Automated and systemic technologies

• High concentration of specialized Dutch companies throughout the supply chain.

– The supply sector is capturing increasing share of value vs. the primary production sector (the growers). By 2020, supply sector estimated to surpass.

Why first to Europe?

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Why first to Europe?

• Forecast: by 2020 LED

lighting market will amount

up to 60 % of the global

lighting market.

• Europe, a market likely to

lead going forward in LED

penetration.

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Source:

The Largest Lighting Sectors

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General lighting

• A complex market with multiple applications

• 75 % of the total lighting market

Automotive lighting

• Sector continues to grow, driven mainly by conversion of automotive headlamps to LED technology

Backlighting

• Market will decline due to a decreasing number of LEDs required for example per TV

General Lighting Applications

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Residential lighting

• Around 40 % of the total general lighting market.

Architectural lighting

• LED covering 85 % of the market.

Hospitality, shop and outdoor

• LED applications are expected to see fast growth in market share up to 70 % or more by 2020.

Office and industrial applications

• Slower market development due to the high penetration of cost-competitive linear fluorescent lamps.

Greentech Media

Forecast of LED Adoption by Sectors

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Snapshots from Germany

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Düsseldorf

• 60.000 street lights, of

which 43.000 electric,

17.000 gas powered

• expected CO² reduction

by year 2015: 8.000 t

• change into LED lights

started already in 2007

• As there were no proper

LED street light on the

market at that time, city

Düsseldorf developed

together with university a

own product

Hannover

• 60.000 lights

• Aim to gain experience of

luminance, light

distribution, quality, and

maintenance

• Pilot project to learn more

about service need and

durability

• Wanted manufacturer

with good image and

references

• First feedback : adequate

lighting with a 46 %

reduction in light energy

Kissing

•Among first municipalities

in Germany planning an

entire switch to LED

technology in street lighting

• first LED lights 2009

• Better control over the

light distribution and

avoiding light pollution also

considered as key factors

Snapshots from Italy

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Bergamo

• Deep Frame LED

luminaires for foyer lighting

in architectural lighting

renovation

Autostrade per l’Italia

• LED systems already

been tested and installed at

a number of junctions and

toll plazas in order to

optimize lighting and

improve visibility

Autovie Venetie

• Refurbishment on next 4

years (2013) include

installation of the latest

generation of LED lamps.

Upgrading of the lighting of

interchanges of Redipuglia

has just been completed.

Magenta

• 3 km of bicycle road as

turnkey project

Torraca

• 700 LED light points

installed. Commitment to

convert 100% of outdoor

lighting to LED in mid-2007.

Resulted in 75% energy

savings.

Tunnels

• Installed 6,378 lights in

2009 in motorways tunnels.

Further 10,766 LED lights

installed in 2010. Annual

energy saving in tunnels

estimated as 3,992 MWh.

Snapshots from the UK

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Birmingham

•City Council’s £70 million

rollout of Philips/Indal LEDs

across Birmingham is the

biggest LED deployment in

Europe, expected to bring

energy savings of 50%.

Tesco grocery stores

• Opened the first store

2012 to run solely on LED

lighting. All external signage

installed using LED fittings,

as well as the sales floor

and in staff areas.

Bromley

• An £8.5 million investment

programme of state of the

art LED street lights across

Bromley over next years.

27,000 street lamps will be

replaced .

Transport for London

• Deep Frame LED

luminaires for foyer lighting

in architectural lighting

renovation

Salford

• 2011 pilot retrofit of 2000

LED street lights across

300 streets in Salford.

Council now approved the

roll out of a further 24,000

street lights across the city .

Sheffield

• All 68,000 of Sheffield’s

street lights will be

replaced by LED lights.

… and more snapshots from Europe

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Eindhoven, Netherlands

• Replaces all orange

street lighting with LED

lighting in 2013 for soft

white light and perfect

colour rendering, improves

social control in the area.

The system is ‘floating’ i.e.

lights are integrated in

cables instead of poles.

Paris, France

• Switch to LED replace the

250,000 light points in

RATP’s 302 metro stations

and 66 RER stations will

reduce the energy needed

to light up the Paris metro

and suburban RER

stations by more than 50%,

while improving the light

quality at the same time.

Barcelona, Spain

• City Council is introducing

LED technology in the

replacement of 13 000

traffic lights in the city, with

an estimated annual

saving of 800,000€.

Barcelona decided in 2010,

after a pilot project with

LED street lighting in six

pilot areas, that the

technology still has to

evolve, but seems to be

available in a short term in

competitive conditions.

Our Promise

Finpro helps Finnish companies to grow and

succeed in international markets

We work with you to:

• Plan your internationalization process

• Help you with funding by providing access to the

right contacts

• Put your plans into practice and gain a

successful foothold in target markets

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Finpro’s Global Network

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Acquisition

Candidate Search

Market Monitor

Sales Accelerator Entry Options Partner Search International

Growth Plan

Test Drive

Right Markets

Sales Channel

Development Direct Sales

Establishing

Company

Supplier Evaluation

Export Partner

Groups

Trend Pulse

Improving

Market Position

Establishing

Presence

Right tools to Optimize Your Company’s Growth

10/25/2013 18 © Finpro

Planning

Market Entry

Preparing

Growth

Industrial Services

Finpro References in

Energy and Environment Industry

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Finpro and GreenStream

Network developed a

cooperation model and

GreenStream Network could test

five markets with moderate

investments and had a quick

access to new emerging EUA

markets.

The cooperation with Finpro

succeeded very well and we

received relevant market

information. We were able to

acquire the first hand information

straight from customer interface,

which was very valuable for us.

Our experience from Finpro was

all in all very positive. Local

experience and presence in target

markets were remarkable benefits.

With the contribution from

Finproners we could get a good

understanding of the markets. It

was a very cost-efficient way to

test the markets.

Harri Roto, Executive Vice President,

GreenStream Network Plc

GreenStream Network is a leading Nordic developer and

manager of green investment vehicles. The company is

established in 2001 and has its headquarters in Helsinki.

GreenStream Network`s home market is Northern Europe.

China and South-Africa are company`s key areas for growth.

GreenStream Network had positive experiences from Baltic

Countries and in 2008 company wanted to extend their

operations to Eastern Europe. Establishing own offices and

finding own agents was considered to be too expensive and

slow way to proceed. It was also estimated that traditional

market research couldn`t reveal relevant issues from customer

interface.

Finpro and GreenStream Network developed a cooperation

model, where Finpro sales consultants acted as GreenStream

Network`s representatives in five countries: Bulgaria, Czech

Republic, Hungary, Romania and Slovakia. They contacted

potential customers and arranged meetings. After half a year

presence GreenStream Network discovered the East-European

markets less attractive than estimated and decided to

concentrate in faster growing markets like China.

GreenStream Network could test five markets with moderate

investments and had a quick access to new emerging EUA

markets. Other benefits for GreenStream Network were

systematic and professional market information, client

identification and preparing of deals. At the moment

GreenStream Network continues the cooperation with Finpro to

find new markets in South-East Asia.

Sofi Filtration is a Finnish

company founded in 2011

offering state-of-the-art water-

filtration technology. Cooperation

with Finpro has resulted in the

company finding two good

agents in the German market.

Ville Hakala, Sales Director and

Chairman of the Board, Sofi Filtration

Oy

We're truly impressed by the way

in which Finpro operates. They

were exceptionally successful in

identifying agents for us in the

German market, and the Go

Global program was an efficient

way of benefiting from Finpro's

extensive geographical network

and local knowledge. Our

cooperation has given us

credibility in global markets and is

certain to continue.

Founded in 2011, Sofi Filtration is a Finnish company offering state-of-

the-art water filtration technology. The company's main product is Sofi

Filter, a high-capacity polishing filtration solution for industrial

processes. Based on an innovation by Pertti Rantala, one of the

founders of Sofi Filtration, Sofi Filter has been commercialized with the

help of funding from Tekes - the Finnish Funding Agency for

Technology and Innovation - and the private sector.

Even though Sofi Filtration is a so-called 'born global' company, it is

small and only recently-established, and does not have the resources

needed to embark on the internationalization process alone. Finpro

helped Sofi Filtration with client segmentation, its value proposition

and the definition of channel models, and with professional agents to

open up international channels.

Sofi Filtration participated in the Uusimaa Go Global program, during

which both potential markets and client sectors for the company's

products were defined, as well as all of its sales material and

webpages were renewed. Primary markets were identified in countries

where the mining sector is strong: Australia, Canada, Chile and South

Africa. Together with Finpro, a strategy for achieving an international

technological breakthrough was also drawn up, and Germany was

chosen as the target because the resulting credibility would support

efforts in other markets. The German car manufacturing industry has

expressed interest in Sofi Filter technology.

Through cooperation with Finpro, Sofi Filtration has found two good

agents in the German market. Pilot versions of equipment for testing

are currently being prepared. Discussions with a representative of the

Canadian mining industry are also ongoing and an agent agreement

for Belgium has been signed. The company believes it saved at least

six months by initiating its survey of international markets with Finpro's

help during the final phase of the commercialization process.

Rahoitusvaihtoehtoja

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26 © Finpro

Valmistelurahoitus

max. 15 k€/ 70 % tuki

Projektin max. arvo 21400 €

Yrityksen

kehittämisavustus

n. 15–100 k€ / 50 % tuki

Yhteishankintakoulutus

n. 30-130 k€ /70 % tuki

Tekes T&K avustus

n. 20–500 k€ (50 % tuki) ja

T&K laina (50-70%

kustannuksista)

Tekes De minimis avustus

max. 100 k€ / 35-50% tuki

Tekes nuoret innovatiiviset

yritykset

50 k€ + 250 k€ + 750 k€ / 75

% tuki

Go Global Plus

(ELY/Finpro) arvo n.17.5 k€,

johon n. 75 % tuki

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