Commercial LEDs Lower Energy Costs, Increase Property Values

A commercial LED retrofit does more than lower energy and maintenance costs. Even accounting for the initial capital investment, commercial LED lighting can dramatically increase property values.

Here’s one example: A big lighting retrofit in Los Angeles County cost the property owner $60,000. Because the client financed the project, paying for it over time, the savings exceeded amortized costs in Year 1. But the big win was market value, according to Don McDougall, general manager, Solid State Capital Services (SSCS), which finances lighting upgrades.

“The savings in energy usage were so pronounced that the property’s market value was increased by $426,000,” McDougall wrote in a 2014 issue of LEDs Magazine.

Commercial Clients See Immediate Savings with LED Projects

Lighting accounts for about 19 percent of commercial electricity consumption. A LED retrofit can cut monthly lighting bills in half.

Recently, SunGreen replaced 900 conventional lamps with LED fixtures for one of our own clients, Mortech Manufacturing, as part of a bigger project that included installation of a solar PV system. The company, based in Asuza, will save $19,000 per year on its lighting bill alone.

A few other examples:

• Starbucks cut energy consumption at its stores by 80 percent after switching to LED lighting in 2010. Individual stores averaged $600 a year in annual savings.
• Los Angeles completed its switch of 141,000 fixtures from high-pressure sodium streetlights to white LED lighting in 2013. The new LED lights use 64 percent less electricity.
• Sheetz, the convenience store and gas station chain, installed LED interior and exterior lighting at 130+ locations in 2014. Sheetz is saving up to 45% on interior and 55% on exterior lighting.

Depending on location, commercial property owners can see even more substantial savings. A 24/7 operation, such as a parking garage, can save 80 percent or more using LED lighting with a control system.

Commercial LEDs Offer Broad Benefits

The Mortech Manufacturing project illustrates the link between LED lights and a solar system. Antiquated lighting demands more power, and a LED retrofit prior to solar installation greatly reduces the amount of solar needed to offset load. With its new LED lights, Mortech could use a smaller solar photovoltaic system and realize additional savings.

Lower energy costs and higher property values are two big benefits of an LED retrofit. But benefits for the company, its employees, and the environment are far broader.

Incandescent lighting creates lots of heat, and fluorescent lights emit more heat than you think. LEDs are cool to the touch, don’t give off heat, and don’t force an air conditioning system to work harder.

LED lighting is more efficient. Only 10-20 percent of the energy used by an incandescent bulb produces light; 80 to 90 percent is emitted as heat. With LED lighting, the scale flips - an estimated 80-90 percent of the electrical energy is converted to light.

With 8 hours of daily use, LEDs have an expected life of 12-16 years. They last 5 times longer than fluorescent bulbs and up to 50 times longer than incandescent bulbs.

Interested in flipping the switch? Our experts will help you calculate cost, savings and design new commercial LED lighting that will also make your property more valuable.

http://www.ledsmagazine.com/articles/iif/print/volume-3/issue-1/features/renovation/commercial-led-retrofit-justifies-project-with-market-value-increase.html

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