north carolina utility savings initiativevapor lamp 1970s first red led ~1990 “high brightness”...
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Copyright © 2007, Cree, Inc. pg. 3
Cree Heritage
Revenue (Millions US $)
$155
$230
$307
$389$423
$-
$50
$100
$150
$200
$250
$300
$350
$400
$450
2002 2003 2004 2005 2006
Fiscal Year
• Founded in 1987 to commercialize silicon carbide (SiC) semiconductors
• Introduced first blue LED in 1989
• Publicly traded on NASDAQ since 1993 (Symbol: CREE)
• Market capitalization $ 2 B USD
Copyright © 2007, Cree, Inc. pg. 4
Cree Around the World
• Headquarters:
– Durham, NC, USA
• Global Locations:
– Santa Barbara, CA, USA
– Dulles, VA, USA
– Vienna, Austria
– Huizhou, China
– Tokyo, Japan
– Hong Kong
– Taipei, Taiwan
– Seoul, Korea
– Penang, Malaysia
• ~ 2,400 Employees *(* includes COTCO)
Copyright © 2007, Cree, Inc. pg. 5
Cree Solid State Lighting
History
• Cree started packaged LED development in 2003 with the charter of creating an LED lighting revolution.
Product Development
• XLamp packaged LEDs shipped in July 2004.
• Currently providing full portfolio of LED lamps in color and white with currents up to 1000 mA.
• All package design, engineering, and reliability testing are done in house.
• Cree has an extensive library of patents & IP.
Copyright © 2007, Cree, Inc. pg. 7
…A Brief History of Lighting
1879Edison Light
Bulb
U.S. 223,898
1901Fluorescent
Tube 1919Sodium
Vapor Lamp
1970sFirst RedLED
~1990“High Brightness”Red, Orange,
Yellow, & Green LEDs
1995“High Brightness”Blue, Green LEDs
2000White LED LampdemonstratesIncandescent
Efficacy (17 lm/W) 2005White LED LampdemonstratesFluorescent
Efficacy (70 lm/W)
• Current lighting technology is about 100 years old!
• LEDs began as just indicators, but are now poised to become the most efficient light source ever created – we call this the Lighting Revolution!
Copyright © 2007, Cree, Inc. pg. 8
A Long History of Success for Solid State
VHS DVD
Vacuum Tubes
Transistors
Film Flash Memory
CRTTV
Flat Panel TV and
Displays
Light Bulbs/
Fluorescent Tubes
Solid State
Lighting
1940s – 1950s
1980s –1990s
1990s –2000s
1990s –2000s
2000s – …
Copyright © 2007, Cree, Inc. pg. 9
0
10
20
30
40
50
60
70
80
Time
Market Opportunity
Color White (Today) White (Emerging) Backlighting Office/Home
Pote
ntia
l T
AM
= $
50 B
illio
n*
Drivers- Maintenance Benefit- Energy Savings- Battery Life- New Feature/Capability
*Source: Morgan Stanley Research
Emerging applicationsExisting LEDApplications
Copyright © 2007, Cree, Inc. pg. 10
Why Now?
• Latest generation of High Power LED technology
– The brightest production devices available today are 300% brighter than just 18 months ago, also 30% cheaper
• Economics are starting to make sense
– Every time they get brighter and cheaper, the economics begin to work on more and more lighting applications…
• Combined with..
– Energy prices and volatility – world politics, oil prices
– Regulatory – Energy Star®, light bulb bans
Copyright © 2007, Cree, Inc. pg. 11
Light Source Efficacy Trends
0
20
40
60
80
100
120
140
160
180
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Eff
ica
cy (
lum
en
s/w
att
)
Incandescent
CFL
Metal Halide
Fluorescent
High Volume LED
Production Best
Best Announced LED
R&D Capability
Cool White 1W Power LED*
LED Technology Is Accelerating
* US Department of Energy Projections, March 2007
Copyright © 2007, Cree, Inc. pg. 12
Cree XLamp® Technology
7090 XR
First Generation Power LEDs
Second Generation Power LEDs
25% brighter & 11% better efficacy
XLamp XR-E100 lm
Today“Lighting Class”
LEDs
XLamp XR-E80.6 lm
OCT 2006
40% brighter & 50% better efficacy
FEB 2006
Copyright © 2007, Cree, Inc. pg. 14
PN junction semiconductor diode that emits a monochromatic (single color) light when operated in a forward biased direction.
Light Emitting Diode (LED): How it works
• LEDs consist of several layers of semiconductor material
• Light is generated in the active layer when a current is applied
• Unlike an ordinary light bulb which emits a continuous spectrum of light, the LED light is monochromatic or a single color
• The color of light from the LED depends on the materials used
• There are two material systems (AlInGaP and InGaN) use to produce LEDs in all colors from blue to red
Copyright © 2007, Cree, Inc. pg. 15
XLamp® Packaged LEDs
LED die
ESD protection
Wire bondReflector
Lens
Substrate
Copyright © 2007, Cree, Inc. pg. 17
Producing White Light
• Two methods: “RGB” and “Blue + Phosphor”
– RGB: Higher quality, but higher price and power
– B+P: Lower quality (improving), lower price and power
• Most apps focused on “Blue + Phosphor”
Copyright © 2007, Cree, Inc. pg. 19
Basic Advantages of LED Light
• Are very energy efficient ���� >80LPW (still improving…)
• Are directional ���� No wasted light, any pattern possible
• Have very long lifetime ���� >50,000 hours to 70% LM
• Are inherently rugged ���� No filament to break
• Start instantly ���� nanoseconds vs. > 10 min (HID)
• Are environmentally sound ���� no Hg, Pb, heavy metals
• Are infinitely dimmable, controllable ���� New lighting features, power savings
• Love cold temperatures ���� No cold starting issues
LEDs can technically replace ANY incumbent lighting technology. Lum/$ remains a barrier for some applications, but is improving
Copyright © 2007, Cree, Inc. pg. 20
“The Promise” Energy Usage Comparison
0
10
20
30
40
50
60
Light Source
60W Bulb
CompactFluor.
LED
“Best” White LED and Compact Fluorescent vs. 60Watt Light Bulb ComparisonP
ow
er
Use
d (
Watt
s)
XLamp LED
Copyright © 2007, Cree, Inc. pg. 21
The LED Directional Advantage
• Conventional lighting is inherently omni-directional
– Lower fixture efficiency or “usable lumens”
• LED Light is inherently directional
– Higher fixture efficiency or “usable lumens”
~90°view angle
XLamp LED
Conventional Lighting
Reflecto
r
Copyright © 2007, Cree, Inc. pg. 22
Lighting System Efficiency
LumensPer Watt
Usable Lumens Per Watt
Fixture Efficiency
150 W Cobra Head Type II Streetlight
(HPS)
91 4650%
Luminaire Type
T8 FluorescentTube 80 6277%
400W HID w/Glass Housing (MH) 70 3854%
Incandescent 10 770%
CompactFluorescent 45 1533%
Copyright © 2007, Cree, Inc. pg. 23
Directional LED Light = Better Fixture Efficacy
Fixture Efficacy
32 lm/W65 lm/W
CFL
Coefficient of Utilization
58%x =
* Including loss for thermal equilibrium @ Tj = 65°°°°C
Coefficient of Utilization 77%
Loss for thermal 90%*46 lm/W =
Previous LEDs x
xFixture Efficacy
32 lm/W
XLamp XR-E 56 lm/W =x
xCoefficient of Utilization 77%
Loss for thermal 90%*
Fixture Efficacy
39 lm/W
Copyright © 2007, Cree, Inc. pg. 24
LED Lifetime and Lumen Maintenance
40%
50%
60%
70%
80%
90%
100%
110%
0 10 20 30 40 50 60 70 80 90 100
Operating Time (k hrs)
Lumen Output (%
)
100 W Incandescent
5mm LED
42W CFL
50 W Tungsten Halide
400 W Metal Halide
25 W T8 Fluorescent
Cree XLamp
• Operating under reasonable design conditions LEDS have a projected lifetime of 50,000 hours at 70% lumen maintenance
• LEDs inherently fail “gracefully” – no burn out, catastrophic failure
• Up to 100,000 hours (>11 years continuous life) can be projected
Copyright © 2007, Cree, Inc. pg. 25
Light Source Comparison
20-24k<5091High-pressure sodium
20k55-6074T8 fluorescent
20k96107T5 fluorescent
> 50k50-7080Cree XLamp XR-E
> 50k40-4747Cree XLamp XR
18k65-70120Low-pressure sodium
5k-15k<4070Metal halide
20k45-5060T12 fluorescent
10k12-2020Halogen
3k10-1717Incandescent
Lifetime (hrs)Usable* lm/W
Data Sheet lm/W
Light Type
* Typical expected performance in real-life applications
Copyright © 2007, Cree, Inc. pg. 26
Mercury Emission by Light Source
0123456789
10
Hg in CFL Hg in
Emissions
from Coal
Plant
60W Bulb
CFL
LEDMill
igra
ms o
f M
erc
ury
CFL Source: U.S. EPA Fact Sheet:http://www.nema.org/lamprecycle/epafactsheet-cfl.pdfLED Source: UCSB SSLDC estimate for 150lm/watt White LED
Copyright © 2007, Cree, Inc. pg. 27
Incandescent
FluorescentHigh Intensity Discharge
Compact Fluorescent Halogen
Pros: Cheap, efficientCons: Poor color,
long restart, short lifetime
Pros: Very cheap, great colorCons: Very short lifetime,
poor energy efficiency
Pros: Cheap, energy efficientCons: Can not run in cold temp;
difficult/costly to dim, control, Hg
Pros: Energy efficientCons: Poor color quality,
Can not run in cold,High cost vs. Incand, Hg
Pros: Great color, focused lightCons: Very short lifetime,
poor energy efficiency
No Perfect Artificial Light Source Exists (yet)
Copyright © 2007, Cree, Inc. pg. 28
Tipping Point is Close On All The Major Apps…
0
50
100
150
200
250
300
350
400
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Nu
mb
er
of
1W
LE
Ds N
eed
ed
0
25
50
75
100
125
150
175
Exp
ecte
d L
um
en
s p
er
1W
LE
D
150W Roadway
400W HID Met
4x T5 FL Troffer
Lumens/1W LED
Copyright © 2007, Cree, Inc. pg. 30
0
10
20
30
40
50
60
70
80
Time
Increasing the Adoption of LED Light
ColorSpecialty
White Specialty
Outdoor Light
Indoor Directional
Indoor General
XLampCool White
XLampWarm White
Market for LED General Illumination
Copyright © 2007, Cree, Inc. pg. 31
Making the Business Case Work
Initial applications will be driven by maintenance avoidance & energy savings
– Street & Parking lot lighting– Parking garages– Atrium– Tunnels– Hazardous work areas
Copyright © 2007, Cree, Inc. pg. 32
Light Source Comparison
2-3 Year Payback For End Customer
Conclusion: LEDs are now both bright enough and economical enough to work in outdoor lighting
Street Light Comparison Example
$-
$200
$400
$600
$800
$1,000
$1,200
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
HID Cumulative Cost
LED Cumulative Cost
Cumulative Value Created
Copyright © 2007, Cree, Inc. pg. 33
Attractive Financial Proposition For Fixture Co.
Tota
l F
ixtu
re C
oO
*
Bulb
$200
$0
$400
* NOT including power or initial installation labor
10-year Cost of Ownership*
Conventional HID Fixture
Initial Fixture
Sale
35 – 45%
GM
$300
Labor
Labor
LED Fixture
Initial
Fixture
Sale
50% GM
LED
Fixture
Type II Cobra Head Roadway Light
$100
MetalHalideFixture
Maintenance
Events
Bulb
Bulb
Bulb
Labor
Labor
Labor
Maintenance
EventsLaborLabor
Copyright © 2007, Cree, Inc. pg. 34
Cree LEDs in Emerging LED Markets
PortableLighting
OutdoorLighting
IndoorDirectionalLighting
Copyright © 2007, Cree, Inc. pg. 35
Refrigeration Display
• Wal-Mart announced last fall that it would retrofit refrigerator cases in more than 500 of its stores with LED lighting systems
• Wal-mart estimates that this move alone will save $3.8 million a year and reduce carbon dioxide emissions by 65 million pounds
• Reduction in energy of 10% for Wal-mart EQUALS the entire cost of transportation – 950 million miles last year
Wal-mart Operating
Expenses by Category
Copyright © 2007, Cree, Inc. pg. 37
Summary
• LED light offers significant advantages over traditional light sources– Long lifetime & rugged
– Efficient, directional light
• LED advantages create real value through:– Maintenance avoidance
– Energy savings
• Brighter LEDs = More LED lighting applications– Outdoor LED light revolution happening now!
– Indoor directional LED light revolution coming soon
• Need for efficient, long-lifetime light sources will help increase LED light adoption– LED City initiative
– CA Title 24, Australia, European Union, U.S. DOE
Copyright © 2007, Cree, Inc. pg. 38
LED City Initiative Overview
• Joint initiative between Cree & City of Raleigh, NC
– Launched February 12, 2007
– Broad commitment to LED lighting across the entire Raleigh city infrastructure
• Funding and resources
– Multiple target applications
• Parking garages, Parking lots, Street lights, Pedestrian lights,Portable lighting, Outside buildings
• LED City website will act as a hub of information
– Community of LED Cities sharing information
– Joint testing, deployment and promotion of LED lighting
www.ledcity.org
Copyright © 2007, Cree, Inc. pg. 39
One Tangible Example of Outdoor LED Light
Raleigh, NC, USA – “LED City” – Parking Garage
• XLamp LEDs in commercially available fixtures
• Delivering >40% total power savings
• Can deliver <5 year payback TODAY
100W HPS 75W White LED