Ready. Set. JUMP!?
April 23, 2013
When do I make the jump to LED?
I’ve been asked that question by countless customers.
When should we start promoting LED?
I’ve been asked that question by many coworkers.
When you consider the many markets pondering the jump to LED, answering these questions are complicated. So complicated that I couldn’t possibly contain them in one blog or white paper. However, while the answers are different for each market, the follow-up questions are essentially the same. In this post, I’m going to share these questions. Then, continue to watch this blog as I get into detail, by market, in upcoming posts. I’ll explain how the answers to these questions can make a huge difference, and give my best estimation of when to jump for each market.
So, you’ve asked me, “When do I make the jump to LED?” I answer with these questions:
What type of facility is it? This first question is the reason I’m addressing this topic by market segment. Trying to look at all types of buildings at once would’ve made the answers too complicated to be useful.
Do you care about Payback or Total Cost of Ownership? The answer is probably “yes,” as in you would say that you care about both metrics. In my experience, unless the Total Cost of Ownership (TCO) is telling a vastly different story, most customers focus almost exclusively on payback. LED broke through the TCO barrier fairly recently on many types of projects, but for the foreseeable future (3-4 years) LED solutions will have a bit longer payback than non-LED solutions. There will be certain instances where that is not the case, but generally speaking fluorescent will pay back more quickly than LED.
Where is the building? Facility location determines the electric utility, which helps us understand energy rates and incentive opportunities. All other things being equal, in locations where the kWh rate is double than that of others, you can expect to see project payback cut in half. That’s why project prioritization can make a massive difference. Not only can LED incentives significantly improve payback, but as utility companies start to shift to LED incentives (away from fluorescent), paybacks can get longer for fluorescent solutions.
What’s your existing lighting? The 2000’s saw a big dent in the population of HID lamps in the market (especially in high energy rate areas). There are still a lot of HIDs out there though. Now, some of those high energy rate areas with facilities that have previously converted to fluorescent are almost ready for a re-conversion.
Does your company have Green Initiatives? A small segment of customers would choose LED for other reasons. LED fixtures have come far enough now, where it’s not crazy to blindly select LED as the solution for your building.
So, subscribe to this feed or follow me on Twitter to know when I’ve blogged about each market. I’m off to Lightfair. Hopefully, I’ll see you there.
Tony Johnson is Energy Management Collaborative's Technology Manager. In this role he combines his background in lighting & controls design and solid state light fixture design with his expertise in energy savings to evaluate emerging technologies for EMC customers.