LEDs: Good News in a Weak Economy|
Due to the current weak economic climate there is an increasing emphasis on cost cutting and savings in the commercial and industrials sectors. Businesses are increasingly looking for ways to increase operating efficiency while also reducing costs, without negatively affecting their production levels or employee base. Although layoffs and off-shoring of production continue to dominate the news headlines, there are many positive methods of improving commercial and industrial financial performance that receive less exposure yet are proving every bit as newsworthy.
One of the most significant positive trends that are rapidly yet quietly rising to prominence is the switch to energy efficient forms of illumination. With illumination representing a major portion of the energy costs associated with commercial and industrial operations, switching to more efficient forms of illumination is proving to be an effective way to produce substantial improvements in both operating costs and overall operating efficiency. Producing illumination makes up an average of 25-50% of the electricity usage in commercial applications depending upon their nature. Retail properties can see illumination accounting for up to 37% of their electrical usage for example, while Hospitals may see percentages as high as 50% or more.
Since the currently dominant lighting technology in the form of incandescent bulbs only produces 5- 30% energy efficiency as considered in the conversion of electrical energy to light output, it is clear there is a lot of waste taking place. Additionally, this 95-70% waste of energy is represented not just as wasted electrical power, but energy that is wasted as radiated heat. This adds to further increases in commercial energy consumption in the form of increased cooling costs due to the need to offset increases in heat levels within enclosed structures that utilize significant numbers of inefficient incandescent fixtures. This means that although most averages only consider the actual efficiency and costs of lighting alone, in reality lighting has a significant impact on energy consumption in other areas as well.
Clearly there is a great deal of room for improvement, and advancements in lighting technology are proving up to the task with LEDs leading the way towards significant reductions in energy costs.
Boasting energy to light conversion rates of up to 90%, LEDs represent a massive increase in lighting efficiency over traditional incandescent bulbs. To more clearly understand how large this difference is, consider that a single 100 watt incandescent bulb produces approximately 14-17 lumens per watt. Assuming peak efficiency, this means that a 100 watt incandescent bulb will produce 1700 total lumens. Now consider that a typical LED produces approximately 45-80 lumens per watt. This means that an LED fixture can produce 2000 lumens of light with only 25 watts. That is more light produced than the incandescent, with only one quarter the amount of electrical energy.
To further demonstrate the improvements in efficiency that LEDs represent, consider now the total energy usage over the life of a lamp or fixture. One of the big problems with acceptance of LEDs is the fact that the initial outlay for the lamp is considerably higher than that for a typical incandescent. Whereas an incandescent bulb may cost only $1.50, an equivalent LED lamp may cost $40.00. Upon initial consideration this may seem an excessive increase in initial outlay. However, this is deceiving when the total lifetime costs of both luminaries are considered.
A typical incandescent lamp has a lifetime of approximately 1,000 hours with some capable of achieving 2,000 hours in optimal conditions. In comparison, the average LED fixture is rated at 50,000 hours of operation, and in many cases as high as 100,000 hours. So, in order for an incandescent lamp to achieve the same operational period it would need to be replaced approximately 50 times. At $1.50 per replacement, that amounts to $75.00 in replacements costs, surpassing the one time outlay of $40.00 for the LED by $35.00. At this point the cost effectiveness of the LED is already demonstrably greater than the incandescent. However, we must now also factor in the energy usage of each over its entire lifetime.
A 100 watt incandescent bulb will use approximately $500 worth of electricity over 50,000 hours of use depending upon the costs for power per kilowatt. A comparable LED will use approximately $116.00 worth of electricity over 50,000 hours of use, resulting in a savings in electrical costs alone of $384.00. Total costs then for the incandescent will be $575.00 and $156.00 for the LED. This is a huge improvement, and when we consider that LEDs continue to improve in lumens per watt output and therefore efficiency, the disparity between the two will only increase in the LEDs favor. Imagine now, replacing every incandescent within a facility such as a hospital with LEDs. If we were to replace 4,000 100 watt incandescent bulbs with comparable LEDs, then we would be looking at a savings of approximately $1,376,000 over the lifetime of the fixtures. We haven’t even addressed the reductions in costs associated with cooling requirements due to the reduction in radiated heat LEDs represent, but at this point is it necessary?
When looked at comprehensively, it is clear that the initial impression of high cost that is associated with LEDs is quite misleading. The potential savings will also be increased by the dropping costs of LEDs as they become cheaper to produce and demand increases. There is yet another bright spot however that is also often neglected in the media regarding commercial efforts to improve efficiency and costs. This is the fact that about one-third of the nation's more than 3,200 utilities and energy cooperatives offer hardware rebate programs geared towards helping businesses and corporations that invest in energy efficient equipment offset the initial costs associated with upgrading or replacing existing equipment. In other words, the savings we’ve already tallied could potentially be even higher.
With companies like Larson Electronics offering a wide array of LED lighting solutions like the 2 Foot LED Tube Light - T-Series, and rebates and energy savings that promise to make initial outlay not only small, but returns on investment faster to appear, there is indeed a silver lining under all of the negative news that is dominating the media. Although the current economic climate may be weak, it has produced opportunities for savings and potential improvements in commercial growth that sharp commercial interests are quickly taking advantage of.