How Do I Know How Much I’m Really Saving on Energy?

energy cost savingsAdvancements in LED lighting technology continue to offer greater energy cost savings for businesses and homeowners.

Justifying Converting to LED Lighting
Justifying converting to LED lighting is fairly easy when IPL or Duke rebates are applied.  These rebates help offset the initial cost difference between the newer and older style lamps. But it is still important to know just how much the energy cost savings for your relamping project will be.  And even more so, if rebates do not apply to your specific project.

When reviewing your options between incandescent and LED lamps, there is always the trade off between initial product costs versus long term energy savings.  So when making the comparison how do you know what your real energy cost savings will be?

Calculating energy cost savingsIt’s All In The Calculation
Comparing initial purchase price of the different lamps is one factor to consider, but can be misleading on the potential for real long term savings.  To assess the value of converting, let’s use an example of replacing a 60 watt incandescent lamp with a 9 watt LED bulb.

Step 1:  Determine the difference in wattage
In this example the difference between the 60 watt incandescent and 9 watt LED is 51 watts.

Step 2:  Calculate Kilowatts/hour (Kwh)
Divide the difference in watts by 1000 to convert watts to kilowatts.  Then multiply this value by the number of hours those lamps are normally in use.  Kw x hours = Kwh

Step 3:  Determine total watts used and cost of energy
Count the number of lamps in use and find out what you are paying for each Kwh used.

Energy SavingsStep 4:  Calculate Energy Cost Savings
Calculate energy cost savings by taking the kilowatt hours consumed each hour and multiplying this number by the number of lamps in use, and then multiply this total by your cost of energy.

In our example we’ll replace 20, 60 watt incandescent lamps with 20, 9 watt LED lamps and make the assumptions that the lights are used 2000 hrs/year and the cost of energy is .123/Kwh (residential rates).

(51watts/1000) x 2000 x 20 x .123 Kwh = $250 annual savings

Unless the initial product cost difference is greater than $12.50 per lamp, you get all of your money back in less than 1 year by converting to the more energy efficient LED lamp.

Product Life Also Factors In
Energy savings alone are not the only way the new LED technology offsets the initial higher cost of the LED lamp.  The average product life of a LED bulb is 15,000 hours compared to an incandescent lamp life of 1000 hours. As a result you will have to purchase 15 of the lower priced incandescent lamps before needing to buy another LED lamp.  Once you have purchased the fourth incandescent lamp you will have spent more than the initial price of the LED lamp.

Let Us Do The Math For You
Let Culture Lighting help you do the math.  We offer a FREE energy assessment to help you determine what approach is best for your business.  Just give us a call at 317-471-1129 or send us an email at

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