Tipping Point: Earth Day, 100W Light Bulb Reprieve and Alexander Hamilton

Last weekend, the world marked the 42nd anniversary of Earth Day and the world continues to look for ways to save energy and live a little bit greener every day.  LED lighting has been capturing a lot of mindshare as the next best energy-saving light source on the horizon since mercury-containing CFLs have lost favor. While the LED lighting market continues to build slowly, industry observers are keeping a keen eye on when it will explode.  Alexander Hamilton may have the answer.

In 2007, US legislators imposed strict energy efficient guidelines impacting 100W incandescent light bulbs.  The first set of regulations were set to hit in 2012, in effect banning traditional 100W light bulbs.  The “ban” was thought to help the LED lighting industry.  But, the 100W light bulb got a reprieve in December 2011 from Congress. In the midst of the holiday hustle and bustle, there was a little agreement inside of the massive 1,200-page spending package that took the teeth out of enforcing the incandescent light bulb ban. Incandescent bulbs were off the hook, temporarily.

Without the US government regulations spurring LED lighting adoption, it is anyone’s guess as to when consumer LED lighting will take off.   IMS analyst Jamie Fox recently wrote a post about LED lighting and the tipping point for consumer LED lighting adoption.  According to Fox, the residential market LED lighting is not quite ready to explode in 2012, but it is starting to get tantalizingly close.  Fox noted that residential LED lighting is the “holy grail” for LED manufacturers “who once saw it merely as a speck on the far horizon, but now can finally enjoy it coming squarely into view. If this market starts to suddenly move, then the whole market for LED general lighting, indeed the whole LED market, will really start to see growth rates increase, even surge.”

Fox and his associates at IMS calculate that LED light bulb prices need to fall to single digits before the market explodes.  Fox explained in his blog post, “It’s not just the psychological impact (i.e. $9.99 vs. $10.00); it also just happens that this is around the point where the payback arguments make sense. Factoring in energy costs, a $25 LED pays for itself relative to a $0.55 60W incandescent lamp in approximately 34 months assuming 4 hours of use per day and energy costs of $0.11 kWh.”  He continued that at $10 (Alexander Hamilton is on the $10 bill) or less, the payback period shrinks to a single year.

When this will happen is anyone’s guess, but Fox insists that the $10 mark will be good news for LED manufacturers.  He continued, “this translates into double digit growth for their whole LED business in 2013 and 2014.”

There is progress on pricing declines.  Market researchers at LEDinside indicate that they are seeing price drops in the vicinity of the $10 mark in South Korea, UK, Japan and United States due to competition and improvements in technology.  According to LEDinside, the 40W equivalent LED bulb’s prices in North America and the UK have been sliding toward US$10. The lowest prices in most areas are expected to fall below US$10 in 2H12.

Facts & Figures:

According to the US Department of Energy, artificial lighting consumes about 10% of a household’s electricity use.  The DOE says use of new lighting technologies can reduce lighting energy use in homes by 50%–75%. Upgrading 15 of the inefficient incandescent light bulbs in your home could save you about $50 per year. This could add up because the DoE says there is more lighting than ever in the US. The DoE attributes the vast majority of the growth to the residential sector, primarily due to the increase in number of households and the rise in the number of sockets per household, from 43 in 2001 to 51 in 2010.

For Further Reading …

IMS LED Blog, Doe LED Lighting Have a Tipping Point?, http://www.ledmarketresearch.com/blog/Does_LED_Lighting_Have_A_Tipping_Point_270

LEDinside.com, LED Bulb Price Dipped Sharply in 12’Jan, 40W Equivalent LED Bulb Price Dropped below US$10, http://www.ledinside.com/price_bulb_201201

USA Today, Congress’ bill may slow switch to efficient light bulbs, http://www.energysavers.gov/your_home/lighting_daylighting/index.cfm/mytopic=11985

LEDs Magazine, US Congress is poised to weaken light-bulb efficiency legislation, http://www.ledsmagazine.com/news/8/12/18

The Washington Times, Congress overturns incandescent light bulb ban, http://www.washingtontimes.com/news/2011/dec/16/congress-overturns-incandescent-light-bulb-ban/

Bringing down the costs of LED street lights

With municipal budgets reeling due to the recession, there has been a lot of activity recently from companies in the LED street light segment about reducing the price of replacement LED street lights.  It appears that LED lighting companies Cree and Bridgelux are working on cutting the price of street lighting in half. A recent Wall Street Journal article by Kate Linebaugh focused on how Cree has cut the price of their LED street lights in half.  Cree’s LED street lights now cost under $200 when bought in volume according to the article.  These put the price of LED street lights on par with the costs of traditional high-pressure sodium vacuum technology when you account for maintenance and energy costs.  How did Cree do it?  They are able to produce a more efficient LED chip so that they can use fewer LEDs in each street light unit.

At the same time, Bridgelux, an LED lighting start up,  is partnering with Chevron Energy Solutions, an energy services arm of Chevron that serves municipalities in the US, to build and install LED modules that can be retrofitted into street lights.  According to a story in Greentechenterprise.com, the two companies hope to bring a solution that’s 30 percent to 50 percent cheaper than today’s options.  Bridgelux’s new modules are designed to be installed in the familiar “cobra head” streetlight fixtures that make up about 65 percent of the country’s 35 million or so streetlights.

The hurdle to municipalities going green with LED street lights is the high initial cost of the LED replacement bulb according to the Wall Street Journal article.  Yet, it is the maintenance cost that hits later for the traditional sodium vacuum street lights. While traditional street lights have a replacement cost of $10, it costs far more to replace one when you take personnel and a truck roll into consideration.  It takes two workers and a bucket truck to replace one street light light bulb at a cost of roughly $200.  My neighbor was awakened to a utility worker loudly replacing a street light bulb at 2:30 am last week.  Although, a single man in a bucket truck made the light bulb switch (traditional kind, not LED).  LED street lights would also mean less frequent disruption for my neighbor in the middle of the night.

For Further Reading:

Wall Street Journal, LED Streetlight’s Price Cut in Half, http://online.wsj.com/article/SB10001424052702304587704577333942881985170.html

Greentechmedia.com, Bridgelux Goes Big In LED Streetlights http://www.greentechmedia.com/articles/read/bridgelux-goes-big-into-led-streetlights/

DOE Municipal Solid-State Street Lighting Consortium, http://www1.eere.energy.gov/buildings/ssl/consortium.html

Seattle Puts Street Lights to the Test

Street lights in Seattle

Which kind of street light do you like better — traditional yellow street lights or new LED street lights? Recent articles in The New York Times and LEDs Magazine covered how a group of power companies, consultants, the Department of Energy, Seattle Dept. of Transportation and Seattle City Light paid 400 people about $40 each to test which they prefer.  The test wasn’t really just for looks.  Utilities and municipalities have serious questions about what works better for saving energy and replacement costs versus safety and the area’s look and feel.

The test seemed to be well thought out, testing street lighting from both a vehicle and pedestrian point of view.  A 15-block stretch of 15th Avenue in the Ballard section of Seattle was closed to traffic so that test SUVs could drive up and down at 35 miles per hour with survey participants. The SUVs were fitted with light sensors, cameras, and a GPS system linked to a customized control system.  The participants were asked to push a button when they spotted small 7×7-in objects placed beside the road. GPS allowed the system to capture the exact location for each detected object for analysis.  The test was followed by a qualitative survey that asked participants to walk the test area under the lights. The written survey asked about the quality of the light, glare, feeling of safety, and other issues.

What about the weather and other variables?  Over the course of the night, lights were dimmed to test how low the lights could safely go before it impacted visibility.  Because of the frequently rainy Seattle weather, the organizers tested variations with the lights to mimic wet conditions.  Unfortunately, the weather was spectacular that particular night, so the organizers had to wet down the streets to get the typically wet Seattle effect.

What were the results?  Neither article had the results, but the organizers have also tested in Anchorage, San Diego and San Jose.  We’ll keep our eyes out for results or if you know where they are, feel free to comment.

Fun Facts:

  • Seattle has already installed 20,000 LED lights, second in the US only to Los Angeles, California, and the short-term goal is to install 41,000 LED lights.
  • There are 26.5 million street lights across the US that use $2 billion worth of energy each year.

For Further Reading:

The New York Times, Seattle Gets the Street View on the Quality of Its Lights, http://www.nytimes.com/2012/03/13/us/seattle-gets-the-peoples-view-on-led-streetlights.html?_r=2

LEDs Magazine, Seattle LED street-light tests focus on visibility and efficiency (Updated), http://www.ledsmagazine.com/news/9/3/4