Environment

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A Spot, a Point and a Direct light all assume that light is coming from a single point. Howvere in reality, light comes from all directions: bounced from the many surfaces of the surrounding environment. An Environment light emulates this by lighting objects in scene with an photograph of the scene. In order to do this, the photograph must have two special qualities:

  1. It must have captured the entirety of the scene... like a fish eye lens only more so. Many special formats exist to do this (lat long map, cube, angular map etc), but Nuke's Environment light only recognises one of them: the mirror ball (which looks pretty much like you expect it would). Fortunately Nuke offers a node which can convert these formats into the mirror ball: the SphericalTransform.
  2. It must express not only the details in the shadows, but also the details in the bright regions. Such a photo is understood as having a high dynamic range (HDR). Usually they are made by merging together many ordinary photos, using special software (such as PS's 'Merge to HDR' capacity).