Home > Cutting Spending, Investing > The Total Cost of Lightbulb ownership

The Total Cost of Lightbulb ownership

Want to accomplish a quick home project that will bring you a 3,000% return on your investment?  Of course you do!  It’s time to look at your lighting and decide what makes sense.  It gets really simple once you’ve had someone like me run the numbers for you…

When it comes to residential energy costs, lighting accounts for about 10%-15% of your home energy costs, so it’s worth reviewing.  The majority of home lighting consists of A19 type screw-in bulbs or replacement CFLs like the one shown above.

You’ve probably heard that CFL’s use 75% less energy, and they aren’t too much more expensive.  You’ve probably also seen a few articles about how LEDs are going to take over the world.  And then there are those pesky laws that are phasing out incandescent lamps over time.  What’s the right answer?

Well you can take the time to read through the energy star website, or you can trust my simple, yet thoughtful analysis.

The Specifications

So let’s start with the basics, incandescent bulbs, CFL’s, and LED’s all put out the same amount of light (measured in lumens), however it takes waaaaaay less energy to do the same thing in CFL’s and LED’s.

An incandescent will cost you about $.33 and use 60W (watts).  A CFL costs about $.75 and uses 14W.  And an LED costs about $15.00 and uses 12.5W.  That’s not a typo, LED’s are crazy expensive right now!

Incandescents last about 1000 hrs.  CFL’s last 8X as long as incandescents, and LED’s last 4X as long as CFL’s.  So if you aren’t confused yet, the reason you pay more for LED’s is because it’s a new technology that lasts way longer than anything else, and uses slightly less energy than CFLs. They also have better color rendering, but I wont get into that here.

Costs, Costs, Costs

Ok, now to the good stuff.  Which bulb actually costs the least to operate.  To make things consistent, I included both an energy cost (energy cost per hour of run-time), and a replacement cost (replacement cost per hour of run-time).

These two costs together yield our “Total Cost of Lightbulb Ownership”.

So as you can see, the more you use your lights each day, the greater the savings potential there is to switch away from incandescents.  It’s also interesting to note that LED’s and CFL’s have essentially the same total cost of ownership.

Right now, unless you have a particular reason to buy LED’s, like color rendering, cold temperature operation, or hard to reach fixture locations, CFL’s certainly make the most economic sense.

3000% ROI

Ok, so why is using CFL bulbs a great investment?

Let’s assume you have a lamp that is on 12 hrs per day.  If you purchase a CFL for .$75 and replace an incandescent bulb, you will be saving $23/year ($30-$7 on the graph).  You will make up your initial investment in 12 days.  That’s a 3,000% return on your investment!

Before you invest in stocks or bond, please invest in energy efficiency.  Nowhere else will you find such crazy-huge returns for doing something as simple as screwing in a lightbulb.

Does it really matter?

Ok, so let’s now assume that a particular lamp only get’s used 2 hours/day.  Does it really make sense to buy a CFL and replace it?  The answer: Yes, absolutely!!!

With this $.75 purchase, you will be saving $4/year ($5-$1, see the graph again).  That’s still a 500% return on investment.

Anyone with incandescent bulbs still in their house is leaving money sitting on the table!  I hope I was able to provide you with some great investment alternatives.  Go forth and use efficient bulbs!

The Future

So what does the future hold for lighting?  The future will almost certainly be LED for most applications.  There are some nich applications that will stay incandescent or fluorescent for a variety of more technical reasons.

But I feel confident in saying that all home replacement bulbs will be LED.  This is because they last longer, they are more efficient, and the price has been falling dramatically as of late.  I’d say they will probably make sense as replacement bulbs within 5 yrs or so.  (but we’ll see)

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  1. January 7, 2013 at 10:19 PM

    An entire blog post devoted to light bulbs! Love it! My electricity bill is way higher in my condo than in my apartments (by way higher, I mean it doubled from $30 for 2 months in my apartments to $60 for 2 months now lol), so I’ve been trying to investigate small ways to help with that.

    I’ve been keeping my stash of lightbulbs well stocked since I have WAY more lights than I did in my previous places and oh my are they expensive! I just spent about $15 on a 6-pack of CFLs. I only have 9 lights (only?!) that take those (lamps, mostly). I think my more expensive lights are the flood ones, of which I have probably closer to 15 in my place. I looked into buying CFLs for them on Amazon and all the reviews didn’t sound so good. Do you know much about indoor CFL flood lights?

    • January 8, 2013 at 7:56 PM

      I am a little crazy about energy efficiency…
      What did the reviews say about CFL flood lights? They should work fine for you, but a common complaint is that they take a few seconds to warm up (sometimes), and they typically have a super white (high color temperature) color that makes people think of hospitals. If that bothers you, you should got with an LED.
      Here’s a back of the envelope calc I just did to help you decide between CFL/LED vs incandescent.
      CFL: Costs about $10, pays for itself in 1.2 yrs
      LED: Costs about $30, pays for itself in 3.5 yrs

      Total CFL savings/yr = (15 bulbs)*(40W)*(4hrs/day)*(365days)*($.11/kwh)/1000 = $120/yr

      • January 8, 2013 at 9:52 PM

        People were complaining that they take a few seconds to warm up. I honestly haven’t had much trouble at all with the 40W replacement ones, so it’s probably not such a bad idea. I’ll re-evaluate once this batch of flood lights die.

  1. December 3, 2012 at 5:22 AM
  2. January 18, 2013 at 6:34 PM

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