Indonesia Lamps & Lighting Market Outlook to 2030

Indonesia Lamps & Lighting Market Overview

• The Indonesia lamps and lighting market was valued at USD 107 million, driven by rapid urbanization, government-backed infrastructure projects, and increasing demand for energy-efficient solutions. The growing focus on smart city initiatives and stringent regulations for energy conservation are pushing the market forward. The governments investment in public infrastructure, including the development of highways, bridges, and public buildings, is increasing the demand for smart and energy-efficient lighting systems.
• Jakarta, Bandung, and Surabaya dominate the market, primarily due to their high urbanization rates and industrial development. These cities are key hubs for commercial and residential projects, which in turn drive the demand for advanced lighting systems. Additionally, Jakarta is the epicenter of smart city initiatives, further contributing to its dominance in the lighting market.
• The Indonesian government's EECA aims to reduce energy consumption through the promotion of energy-efficient products like LED lighting. The EECA, enforced in 2023, mandates energy audits for large commercial spaces, compelling them to switch to energy-efficient lighting. In 2024, around 22,000 commercial buildings across Indonesia underwent energy audits, leading to increased demand for energy-efficient lighting solutions.

Indonesia Lamps & Lighting Market Segmentation

By Product Type: The market is segmented by product type into LED lamps, fluorescent lamps, incandescent bulbs, solar lamps, and smart lighting systems. Recently, LED lamps hold a dominant market share in Indonesia under the product type segmentation. The main reason for the dominance of LED lighting is the Indonesian government's energy efficiency policies, which promote the transition from traditional lighting to more energy-efficient LED alternatives.

By Application: The market is also segmented by application into residential, commercial, industrial, and public lighting. The commercial sector currently leads the market under the application segmentation, accounting for a substantial portion of the demand. The rise in commercial projects, such as shopping malls, office spaces, and hotels, has escalated the need for innovative and energy-saving lighting solutions.

Indonesia Lamps & Lighting Market Competitive Landscape

The market is dominated by several key players, both domestic and international. These companies have established their dominance through technological innovations, partnerships with the Indonesian government, and a wide product portfolio that caters to both energy efficiency and aesthetic design needs.

Indonesia Lamps & Lightings Market Analysis

Market Growth Drivers

• Increasing Demand for Energy-Efficient Solutions: Indonesia's growing focus on energy conservation is boosting the demand for energy-efficient lighting solutions, especially LED lamps. As of 2024, around 18.5 million households in Indonesia have switched to LED lighting, supported by the government's energy-saving campaigns. This shift is particularly strong in urban centers like Jakarta, Bandung, and Surabaya, where energy consumption has surged due to population density and economic growth.
• Rising Infrastructure Development: With the Indonesian government allocating IDR 422.7 trillion for infrastructure projects in 2024, including the construction of new airports, ports, and urban developments, the demand for lighting solutions, including street lighting and commercial lighting systems, has surged. The expansion of cities like Jakarta and the new capital city, Nusantara, has triggered increased consumption of lighting solutions across various public and private sectors, driving growth in the market.
• Government Initiatives for Rural Electrification: The Indonesian government's electrification program, aiming to reach full electrification of rural areas by 2025, is a driver for the lamps and lighting market. In 2024, about 4.7 million households in rural and remote areas gained access to electricity, spurring demand for basic lighting solutions such as CFLs and low-energy bulbs. This initiative not only brings electricity but also stimulates demand for lighting products in regions previously unconnected to the grid.

Market Challenges

• High Cost of LED Lighting: Despite the long-term benefits of energy-efficient LED lighting, the upfront cost remains a challenge in Indonesia. In 2024, the average price for LED bulbs is still around IDR 100,000 per unit, which is considerably higher than traditional incandescent bulbs, creating a financial barrier for lower-income households and smaller businesses. This price disparity limits the widespread adoption of more energy-efficient lighting products.
• Limited Local Manufacturing: Indonesias local production capacity for advanced lighting technology remains low. As of 2024, most of the LED lamps and other modern lighting technologies are imported from countries like China and South Korea. This heavy reliance on imports has caused supply chain disruptions, increased costs, and delayed projects, particularly during times of global trade challenges. The lack of local manufacturing also prevents competitive pricing for high-tech lighting solutions.

Indonesia Lamps & Lightings Market Future Outlook

Over the next five years, the Indonesia lamps and lighting industry is expected to grow, driven by continuous government support for energy efficiency and the growing adoption of smart lighting solutions. The shift toward renewable energy sources, such as solar-powered lighting systems, will further drive market expansion, particularly in the public lighting and industrial segments.

Future Market Opportunities

• Increased Adoption of Solar-Powered Lighting: Solar-powered lighting will play a crucial role in remote and rural areas with limited grid connectivity. By 2030, an estimated 5 million households in these areas are expected to adopt solar-powered lighting solutions, especially for outdoor and public lighting, due to government initiatives to promote renewable energy.
• Expansion of Smart City Projects: The Indonesian government's push for smart cities will drive demand for integrated lighting systems in urban areas. By 2030, Indonesia aims to have 100 smart cities, and each will require advanced lighting solutions like adaptive street lighting and sensor-based lighting systems, significantly expanding the lighting market.