Switching to LED lighting can significantly lower your energy costs. Here's how to estimate your own savings using a simple formula, along with a worked example.
How LED Lighting Saves You Money
LED bulbs use a fraction of the wattage of traditional incandescent or fluorescent bulbs to produce the same amount of light, while lasting many times longer. The savings come from two places: lower electricity use per hour, and far fewer replacement bulbs over time.
The Savings Formula
You can estimate your annual energy savings with this formula:
(Old Wattage - LED Wattage) × Hours Used Per Day × 365 ÷ 1000 × Electricity Rate per kWh = Annual Savings
Example Calculation
Say you're replacing a 60-watt incandescent bulb with an equivalent 9-watt LED, used 5 hours per day, with an electricity rate of $0.15 per kWh:
- Wattage difference: 60W - 9W = 51W
- Daily usage: 51W × 5 hours = 255 watt-hours per day
- Annual usage: 255 × 365 days = 93,075 watt-hours, or about 93 kWh per year
- Annual savings: 93 kWh × $0.15 = approximately $13.95 per bulb, per year
Multiply that by the number of bulbs you're replacing to estimate your total savings. A small office or home with 20 such bulbs could save close to $280 per year on electricity alone, not counting the cost of replacement bulbs avoided thanks to LED's longer lifespan.
Other Factors That Affect Savings
Your actual savings will depend on a few additional factors:
- Your local electricity rate, which varies by utility and region
- How many hours per day the lights are actually in use
- The wattage of the bulbs you're replacing versus their LED equivalents
- Reduced maintenance and replacement costs from the longer lifespan of LED products
Looking to estimate savings for a specific product? Check the wattage listed on any product page and plug it into the formula above, or request a quote and we can help you work through the numbers for your space.