The outdoor lighting industry is undergoing a pivotal transformation, driven by a global push for smart infrastructure, sustainability, and public safety. As cities expand and technology continues to reshape urban landscapes, outdoor lighting is becoming a vital component of the modern built environment. Market forecasts indicate strong and steady growth, supported by advancements in lighting technology, government initiatives, and increasing demand for energy efficiency.

This article provides a detailed forecast of the outdoor lighting market, offering insights into growth trends, technological developments, regional projections, and key factors that will influence the industry through the end of the decade.

Market Size and Growth Projections

The global outdoor lighting market is projected to grow from an estimated USD 13–15 billion in 2023 to USD 22–25 billion by 2030, registering a compound annual growth rate (CAGR) of approximately 6–8%. This growth reflects the increasing demand for efficient, connected, and aesthetically pleasing lighting solutions across municipalities, commercial areas, and residential sectors.

The strong performance of the market can be attributed to:

• Smart city development worldwide

• Infrastructure modernization in developing economies

• Rising awareness of energy conservation

• Enhanced public safety concerns

• Design-focused architectural lighting trends

Key Growth Drivers

1. Smart City Initiatives

Governments across the globe are investing in smart city infrastructure, where intelligent outdoor lighting plays a critical role. These systems use IoT sensors, real-time data, and wireless networks to adjust lighting based on traffic patterns, time of day, and environmental conditions reducing energy consumption and operational costs.

Forecasts suggest that smart outdoor lighting will account for over 30% of all outdoor lighting deployments by 2030, especially in urban centers across Europe, North America, and parts of Asia.

2. Shift Toward LED and Solar Technologies

LEDs continue to dominate the market, thanks to their long lifespan, energy efficiency, and reduced maintenance needs. Meanwhile, solar-powered outdoor lighting is becoming increasingly popular in rural and off-grid areas due to lower installation costs and independence from electricity grids.

By 2030, LED-based outdoor lighting is expected to capture over 85% of the market share, while solar lighting solutions are anticipated to grow at a CAGR of over 10%, driven by affordability and environmental benefits.

3. Public Safety and Urban Beautification

Cities are prioritizing well-lit streets, pedestrian zones, and public areas to enhance safety, reduce crime, and support nighttime economies. At the same time, urban designers are focusing on beautification through decorative and architectural lighting in parks, monuments, and commercial spaces.

This dual-purpose demand functional and aesthetic is encouraging innovation in fixture design and lighting control systems, boosting market growth across applications.

Segment-Wise Forecast

By Lighting Type:

• LED Lighting: Will continue to dominate due to efficiency and compliance with energy regulations.

• Solar Lighting: Fast-growing, especially in emerging economies and remote installations.

• HID and Fluorescent Lighting: Expected to phase out gradually due to high power consumption.

By Application:

• Street & Roadway Lighting: Largest share; significant retrofit activity and smart upgrades.

• Parking Lots & Campuses: Increased adoption of motion-sensing and timer-based lighting systems.

• Architectural & Landscape Lighting: Growing rapidly with tourism and high-end real estate projects.

By Installation:

• New Installations: Growing in developing markets due to infrastructure expansion.

• Retrofit Installations: Dominant in developed regions as outdated systems are replaced with smart, energy-efficient alternatives.

Regional Outlook

Asia-Pacific:

• Leading the market in volume due to rapid urbanization and large-scale infrastructure development.

• Countries like China, India, and Indonesia are major contributors.

• Smart city pilot projects and solar initiatives to drive future growth.

North America:

• Strong emphasis on smart lighting, safety, and sustainability.

• LED retrofitting of municipal lighting infrastructure is a key trend.

• Government incentives and technology adoption will continue to fuel growth.

Europe:

• Advanced lighting systems backed by stringent energy regulations and environmental policies.

• Smart lighting projects in urban centers like Amsterdam, Berlin, and Paris leading the way.

• Continued investment in low-carbon infrastructure will expand the market.

Middle East & Africa:

• Rapid infrastructure development and rising adoption of solar lighting in off-grid areas.

• Opportunities in hospitality, tourism, and public safety-focused installations.

Emerging Trends Shaping the Future

• Lighting-as-a-Service (LaaS): Subscription-based models to reduce upfront investment for municipalities.

• AI and Predictive Maintenance: Enabling proactive system monitoring and cost savings.

• Integration with Urban Mobility: Coordinated lighting with public transport, traffic systems, and pedestrian zones.

• Dark Sky Compliance: Eco-friendly lighting that reduces light pollution and conserves energy.

Challenges to Consider

Despite a promising outlook, certain challenges could impact the pace of adoption:

• High initial capital costs, especially for smart and solar lighting systems.

• Technical complexity in integrating new systems with legacy infrastructure.

• Data privacy and cybersecurity concerns in connected lighting networks.

Addressing these challenges through innovation, funding mechanisms, and collaborative urban planning will be key to unlocking the market’s full potential.

Conclusion

The outdoor lighting market is set to illuminate a smarter, safer, and more sustainable future. With robust growth forecasts, expanding applications, and increasing investment in smart technologies, the industry is on a clear upward trajectory. Market players who invest in intelligent design, energy efficiency, and adaptable business models will be best positioned to capitalize on the opportunities ahead.