5 Steps to Determine How Much Money You Will Save With LED Lights

The goal most people have when converting from an older lamp to a newer LED lighting fixture is to save money on electricity. Although newer lamps will help with efficiency, the amount of money saved is not so easy to determine. Finding this information involves an easy-to-use math equation that any homeowner or business owner can use to determine how much savings they will see.  

Gather Data

You’ll need to collect some general information. For example, you have warehouse lighting you want to retrofit. The metal halide lamp produces 1,000 watts. With the Lepro UFO high bay lights, the wattage is 240. 

• Determine how many hours per day the lamp is to be used. In this instance, the number of hours is 12. 
• From there, determine how many days a year the lamp is used. Ignore the major holidays, and the amount of days is 360. 
• Consider the electricity rate. This rate will vary based on the region and state, but the cost is $0.12/kWh on average.

Determine Per LED Lamp Savings 

The key to finding savings is to look at each lamp. The equation to determine this will be:

The wattage of the old lamp minus the wattage of the new lamp determines energy saved for each lamp

• In the above example, 1000 watts subtracted from 240 watts comes out to 760 watts saved for each lamp.

Determine Yearly Run Time

You only have one part of the answer in determining savings. You need to consider run time for the actual answer. This equation is the following:

Daily run time multiplied by yearly usage to find the total yearly run time

• In the above example, 12 hours of runtime multiplied by 360 days comes to 4,320 hours. 

Determine Total Energy Savings 

The above two steps give you the ability to determine total energy savings. At this point, you’ll be factoring in electricity costs that give the lamp the power for the noted amount of hours. In the above example, the 1,000 watts will be converted into kilowatts, with the equation looking like the following:

Energy saved with each lamp multiplied by yearly run time divided by 1,000 to get Total Savings of Energy 

• 760 watts of every lamp multiplied by 4,320 divided by 1,000, coming out to 3283.2kWh saved.

Determine the Dollars Saved

It’s great to know how much energy you’ll be saving, but nothing hits the psyche more than knowing how much money you are saving. How do you do this?

Multiply the electricity rate by the total energy saved to find the saved monetary amount.

• 3283.2kWh multiplied by $0.12/kWh for savings of $393.98 for each lamp.

As you see, it’s pretty basic math to determine if you see any actual savings when converting to a more energy-efficient wattage. Use the formulas to find the answers to your questions about the products you currently have and looking to purchase.