Subscribe to the Energy Expert RSS feed | Relative to most alternatives, the initial cost of LEDs is still substantially higher. However, prices have halved in the past three years and are expected to fall a further 80% in the next decade. Given the decision cycles of many large companies, prices may well have dropped significantly by the time final procurement occurs. More importantly, with lighting that has a lifetime measured in tens of years, does it make any sense to value them based on today’s electricity price? On a recent American project, the 10-year electricity price risk was estimated between 50% and 105% higher than today’s level. Even at the low end of risk, LEDs would win hands down on cost.
So to answer the question, LEDs are ready for prime time on all critical dimensions. But like so many things in the fast moving energy field, the weight of relatively recent objections deters adoption. This is exacerbated by decision-making processes that maybe made sense for an incandescent light bulb that lasted 1,000 hours, but make no sense for a lifetime measured in tens of thousands of hours.
Another factor in the cost of LED lighting is the need to fit into an electrical and lighting architecture designed for a totally different technology. An LED light is a DC device as are most computer and similar devices. Even with the massive efficiency gains they bring, there is still the burden of AC-to-DC conversion. With rapidly falling prices for LED and solar PV, another DC device, it doesn’t take too much imagination to anticipate buildings with parallel AC and DC systems. DC would carry most of the lighting and IT, and AC would carry motor-driven devices and legacy systems.
Lighting consumes nearly 20% of global electricity generating the equivalent of 70% of the world’s car emissions. A switch to LEDs and day-lighting is a big deal viewed at the macro level. At the site level, with falling costs and lifetimes of many years, does it really make good business sense to make lighting decisions based on initial cost and current electricity prices? When will we be ready to capture the full efficiency potential and start designing buildings compatible with 21st century lighting and informatics rather than something conceived at the end of the 19th Century?
Like many new energy technologies, LED lighting is ready for prime time. Are we ready to prepare the stage?