ROI

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Perth-Singapore 11^th March 2013

Calculating return on investment (ROI) is quite a daunting exercise. Over the last couple of days I have been putting together an ROI for replacing the conventional lighting in a hotel into sustainable lighting solution principally based on LED technology. The simple part is to compare the energy saving that can be obtained on a point by point basis. However the more efficient and performing LED lights may require lesser quantity to obtain the same lighting levels. The thing is that LED does not behave in exact similar ways of distributing light as halogen or compact fluorescent lighting, so in configuring a new lighting layout we need to take into account the different performance qualities of LED compared to the existing traditional lighting effects. It has to be noted that often earlier rounds of energy saving have resulted in compact fluorescent lighting installation with poor lighting levels, loss of mood and ambiance as well as the ability to dim and control the lights, with the original lighting controls not set up to deal with non-dimmable CFL.

One of the most sticky points in assessing ROI is the lifespan of LED lighting. Too many “wild” claims are being marketed by the LED Cowboys, with the serious manufacturers gradually coming to grips with the fact that the early day proclamations of 100,000 hours were grossly overstated. Lifespan ranges from 25 to 35,000 hours seem now much more realistic also because LED is as good as it weakest link. Picking a figure is now anybody’s’ educated guess. But as we have to start somewhere the manufacturer’s data are still our only reliable source as no one has really managed to truly establish the LED life span.

Then comes the aspect of electricity costs, which also greatly varies from country to country, the time of the day and the commercial user rates that some corporations get. In some countries the electricity rates are so low that an ROI based on energy costs alone does not cut any logic. The big impact on the ROI, provided the lifespan figures hold, are really the maintenance savings in lamp replacement labour and costs. It turns out they may well be the biggest influencers of the ROI. There is still another more unquantifiable saving to be added which is the saving on power and heat management. But as this is not my core expertise I cannot really say how much that would be, though I reckon that could be quite substantial….

Light Watch 4-42: It is interesting to see that design sites like Inhabitat have a section dedicated to LED lighting. As I was studying the ROI of LED’s it was a coincidence I stumbled on an LED light in the shape of a book! Made me think of my new Yoga laptop…