Energy Efficiency translates to reducing wastage resulting in real money savings. The more energy efficient, the higher the savings. In the case of LED Lighting; there are many other intangible benefits as compared to the traditional Incandescent or fluorescent tube. They are:
- Traditional Fluorescent generates heat. Thus, the Air-conditioner needs to work harder to maintain a comfortable room temperature.
- A old T12 contains up to 24 mg of hazardous hard metal, Mercury. Once improperly disposed, it goes into the earth water system. There are many documented ill effects of mercury poisoning particular to the nervous system.
- LED is Long lasting. The linear fluorescent has both the lamp lifetime and ballast lifetime shorter than an LED equivalent. Thus, for direct replacement T8 lamp, the ballast could be a failure point in the long run.
- and many more.
The focus of this blog is to demonstrate how Energy Efficiency translates to Money Savings.
Fig. 2 shows the Annual Electricity Bill comparing a Linear Fluorescent with an LED equivalent. The green bar shows the minimum savings. Some could go as high as 70%.
Savings over the lifetime of the lamp
The first bar is the Electricity Bill for a 40W fluorescent lamp. Assuming the T8 LED to replace the fluorescent only consumes 20W, then, every year one will see 50% reduction in the bill. The green is the savings or consider as positive cash flow or profit to the building owner. The green bar could be translated to less overheads to operate a building. If the lamp is 10.5W, the savings will be 70%.
For a 24 by 7 factory with many sites, a 200,000 tube replacement could translate to 30 headcounts reduction, lamp inventory and the need to change the lamp daily. LED is long lasting; thus, less operation disruption and less headcount to replace the lamp.
The biggest negative for LED replacement is the initial cost of the lamp. As suggested, due to price pressure, manufacturer has created a $2 tube; however, it could have many repercussions. This article only relates to industrial grade tubes which are more expensive but make more sense for a industrial setting. Choose wisely.
Zero Risk Value Proposition
If initial cost of the lamp is a bottleneck, one could approach Energy Management companies or Energy Service Company. They are in the business of providing Lighting as a Service (LAAS). Thus, no capital, positive cash flow on the first month by leveraging on the massive savings from reducing the wastage. Instead of paying for the wasted energy, the savings is used to finance the lamps. This is a zero risk proposition.