Lighting Retrofit Cost Savings

A lighting retrofit is the process of replacing components of an existing lighting system with parts that are more energy efficient. Naturally, there are some costs associated with making the transition, yet for many it’s a sensible choice since the changes not only make a facility more eco-friendly but can result in significant energy savings over the long-term.

How does it save money?

How to save money on lighting

The formula for determining your facility’s energy consumption is rather straightforward:

Energy Consumption (kWh) = Input Watts (kW) x Time (hours operated in a given year)

So, the only two ways to reduce energy use are by decreasing the amount of input watts or cutting back on the time your system is used. Lighting retrofits can meet both of these needs, as modern parts are more energy efficient and many have high-tech controls, such as occupancy sensors or day lighting monitors, that keep you from using light unnecessarily.

How much will you save?

The amount your facility will save by performing a lighting retrofit will vary depending on the makeup of your current system and what new products you adopt. However, typical operations reduce energy costs by 50% or more, and considering lighting typically accounts for 30-40% of a facility’s electric bill, that can equate to significant overall savings. Additionally, if your retrofit includes lighting controls, you may save as much as 90% in energy costs.

To find out exactly how much you will save with a proposed retrofit, multiply the input watts of all your fixtures by the amount of time they are used in a year. Then multiply that by your utility costs (kWh rate), and compare the number to how much you are currently spending on lighting. Or, to make things easier, simply input your variables into our online lighting calculator.

To get a general idea of how long it will take to payback your lighting retrofit investment, use the following formula (or use one of our calculators):

Payback (Years) = Net Installation Cost ($) ÷ Annual Energy and Maintenance Savings ($)

In addition to lowering energy and maintenance savings, many lighting retrofits come with rebates and tax incentives, which can lower your upfront costs.

Types of lighting retrofits

Saving money on retrofit lighting

There are a large variety of lighting retrofit options available, including simple bulb replacement (a quick fix) or exchanging fixtures and housing (a comprehensive solution). Some of the most popular upgrades are:

  • Replace incandescent bulbs with CFLs or LEDs — Use 75% to 90% less energy and can last ten times longer or more.
  • Switch from HID light fixtures to linear fluorescent fixtures — Last longer, have better quality light, turn on/off instantly.
  • Swap magnetic fluorescent ballasts with electronic fluorescent ballasts — Saves 40% or more in energy savings, has better light output, and is required by the 2005 Energy Policy Act.
  • Replace switches with occupancy sensors — Reduces energy by 30% to 90%.

While you’re considering retrofitting, remember energy savings is just one of the many benefits of switching to modern lighting solutions. Today’s products also offer better illumination, require less maintenance, improve safety, reduce heat, and much more. To help you decide if a lighting retrofit makes sense for your facility, contact a lighting specialist.

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