GaN-based light-emitting diodes (LEDs) became one of the most widely used light sources. One of their key factors is power conversion efficiency; hence, a lot of effort is placed on research to improve this parameter, either experimentally or numerically. Standard approaches involve device-oriented or system-oriented methods. Combining them is possible only with the aid of compact, lumped parameter models. In the paper, we present a new electro-thermal model that covers all the complex opto-electro-thermal phenomena occurring within the operating LED. It is a simple and low computational cost solution that can be integrated with package- or system-oriented numerical analysis. It allows a parametric analysis of the diode structure and properties under steady-state operating conditions. Its usefulness has been proved by conducting simulations of a sample lateral GaN/InGaN LED with the aid of ANSYS software. The results presented illustrate the current density and temperature fields. They allow the identification of ‘hot spots’ resulting from the current crowding effect and can be used to optimise the structure.