Accounting for The Cost of Light

Author: Kevin Neisen | Branch Manager | Waterloo, IA

Have you ever struggled to figure out if that new LED lamp can really save you money? Learn how easy it is to solve with just a few steps.

The best way to look at the savings is to not just compare the cost of the lamps but to look at the total “cost of light.” To do so, you need to know a few things about the lamp that needs to be replaced and the available replacement options.

To get a good idea if an LED lamp is worth the extra cost upfront, use the following questions and simple equation to help you compare. We'll use a simple 100 watt incandescent lamp and compare it to one of the new LED replacement lamps available on as an example.

1. What do you pay for electricity? We will be using $0.12 per KWH* in this example.

*KWH = 1,000 watts burned for one hour.

Most people will only look at what they are charged per KWH, but to get a true cost you should consider the taxes and other charges showing up on your bill. The best way to figure out exactly what you are paying is to take the total and divide by the number of KWH used for your real cost per KWH.

2. What is the wattage of each lamp? The 100 watt incandescent lamp will be compared to an 18 watt LED replacement.

3. What is the rated life of each lamp? A 100 watt incandescent has an average rated life of 750 hours. The 18 watt LED has an average rated life of 25,000 hours.

In this example, you would have to buy and change the incandescent lamp 33.3 times to every one LED lamp's rated life. LED lamps cost on average $10.00 each and 100 watt incandescent lamps cost on average $0.50 each. This means that over the rated life of the LED lamp, you will need to buy roughly 33 incandescent lamps at a cost of $16.50.

Incandescent Total Cost: $16.50

LED Total Cost: $10.00

Let’s look at the energy costs to light each of these lamps.

Energy used during the rated life of an incandescent lamp: $300

100 watts x 25,000 hours = 2,500,000 watts 
2,500,000 watts divided by 1,000 (to get KWH) = 2,500 KWH
2,500 KWH x $0.12 = $300

Energy used during the rated life of an LED lamp: $54

18 watts x 25,000 hours = 450,000 watts
450,000 watts divided by 1,000 (to get KWH) = 450 KWH
450 KWH x $0.12 = $54

Notice the updated totals.

Incandescent Total Cost: $316.50

LED Total Cost: $64.00

This example shows a savings of $252.50 per LED lamp over its rated lifetime. If you start adding in the labor costs required to change out incandescent lamps in a business, the savings grow even more.

The takeaway

Use caution when comparing lamp prices and consider the total “cost of light," which gives you better insight into the true cost.

Contact your local Crescent Electric branch today to discuss a retrofit for your facility!


Shop today for all of your lighting needs.