Why LED lighting makes sense

by Roberto Verzola

Shifting to energy-efficient LED lighting is a good example of an energy efficiency measure and makes eminent sense, as the following calculations will show.

Consider installing a 15-watt LED lamp for 250 pesos, to replace a 40-watt fluorescent lamp. The more efficient LED lamp provides the same amount of illumination.

Now, every time you switch the lamp on, you are saving 25 watts of electricity. Another way of looking at it is that you are recovering 25 watts that would otherwise have been wasted.

In effect, you have installed a 25-watt micro-generator that starts whenever you turn the switch on. You spent 250 pesos for this 25-watt micro-generator, or P10/watt. This is equivalent to P10T/kW, or P10M/MW.

This is much lower than putting up a solar PV system (around P80T/kW), or building a coal power plant (around P200M/ MW).

The above calculations were for capital expenses (capex). Let us now calculate the cost per kWh, based on the levelized (i.e., averaged over the lifetime) cost of electricity or LCOE. The industry uses the LCOE to compare different energy technologies.

Assume an LED lamp life of 4,000 hours. (Ads claim 10,000 to 15,000 hours.) Thus, over its lifetime, the 250-peso, 25-watt LED lamp will produce 100,000 watt-hours, or 100 kilowatt-hours, of electricity. The LCOE is P2.50/kWh (250 pesos divided by 100 kWh).

Again, this is lower than the cost of rooftop solar electricity (around P5.00/kWh), or the retail price of electricity from utilities (around P9.00/kWh).

Shifting to LED lighting also reduces the overall demand for electricity, leading to lower fossil fuel use and reducing toxic and greenhouse gas emissions. Solar panels during the day and LED lamps at night will reduce overall demand for fossil-based electricity.

That is why LED lighting makes eminent sense. Solar power too.