The Total Cost of Light

You’ve probably heard the expression, “The more things change, the more they remain the same.” While preparing a presentation to a prospective client, it brought to mind the phrase, “Bid for your light bill, not just your light bulbs” — a phrase we have used for 25 years to promote energy-efficient lighting. Too many lighting users focus their attention on finding the bottom in terms of acquisition cost, which generally represents less than 10% of the total cost of light (TCL), and the 10% declines significantly in high rate utility areas. Simply put, energy to create light represents over 90% of the TCL.

There are many questions to ask yourself when selecting the right lighting solution: Where is your corporate energy focused? Is it in finding the least expensive light bulb (which is almost universally the least efficient)? Is it in finding the right mix of quality of light for your specific application, along with the longest useful life and lowest possible energy consumption? The question now becomes even more relevant today with the coming of the age of solid state lighting (SSL), particularly LEDs.

The lighting industry is in the midst of great change, starting with the consolidations and acquisitions of the last few years in both manufacturing and distribution, and now the sea change in technology that LEDs bring. Now more than ever, the lighting industry has the need to truly educate its clients on total cost of light (TCL) if it intends to be successful in promoting and selling LED products that can cost 10 times or more than the traditional products which LEDs are ready to replace. The end user now has an obligation to educate himself/herself on the stunning benefits of wise SSL choices and the dangers of wrong decisions; and wise decisions are not going to come easily, with so many previously unheard of questions to be answered before the product selection is made. Here are some basic questions from an LED performance assessment screening system we have devised:

• Is the product UL tested, or tested by a nationally recognized testing lab (NRTL) to UL standards?

• Does the manufacturer provide LM79 photometric and spectral reports?

• Does the manufacturer provide LM80 data on their LED chips to support their life ratings?

• Does the manufacturer provide a performance warranty that covers lumen maintenance and color shift?

• Whose LED chips are being used?

These are just a few of the go/no go screening criteria questions that can be assessed during a product evaluation and/or recommendation. The larger point here is that this isn’t your grandpa’s light bulb anymore, and the decision-making process is much more complex than ever before. Thus, there is a need for education, “enlightenment” and recognition of the value that your suppliers, manufacturers and distributor can — and must — bring to the table.

No retailer can afford a one-size-fits-all policy anymore when it come to light bulb specification if his facilities are in both high and low utility rate areas. Another way of looking at it is that it makes no sense to make product decisions using an average cost of energy when energy rates can vary by a factor of 3-4X (as low as < .08/kwh to as much as .30/kwh at peak demand times in the highest utility rate areas). Consideration should also be given to whether the location pays directly for its energy, or indirectly through a rent inclusion. These two factors should be considered to develop two different light bulb standards, one with using the best quality, most efficient lamp types, the other with the best quality, standard (less expensive) lamp types. Another component relating to the overall TCL is scheduled and routine lighting maintenance practices which are essential to good lighting. Not only should attention be paid to cleaning luminaires, re-aiming and re-adjusting track and downlights, but also planned, budgeted group relampings. Particularly, metal halide products should be part of every retailer’s program if they value the importance of good lighting as a merchandising tool. Finally, a few recommendations for your consideration include contacting your suppliers to educate you as much as you need to help you make solid product purchasing decisions, particularly when talking LED’s; create an internal lighting team to manage your lighting program and create the policies that will most benefit your bottom line; seek out the best of breed in manufacturer, distributor and product, and above all: “Bid for your light bill, not just your light bulbs!”