Improve lighting, and you will improve a facility’s energy efficiency. Manage your lighting—with equipment, technology and best practices—and you will reduce overall energy consumption and reduce costs. As LED and other lighting technology matures, contractors and other service firms are stepping up to help facility managers further improve lighting operations.

In July, WernerCo—a construction equipment manufacturer in Itasca, Ill., replaced its aged lighting system with a complete interior LED lighting project. The 1,750 new lights, including 900 high-bay fixtures, are expected to significantly reduce the facility’s power consumption and cut its energy bill by a whopping $156,000 annually.

The new LED lighting system was installed across WernerCo’s 500,000-square-foot property and is estimated to lower annual energy use by more than 1,473,000 kilowatt-hours (kWh). The lumen outputs, or brightness, of the new lights will increase light levels by about 60% and reduce energy consumption by 60%. The cost equation sets the project’s return on investment at just 1.6 years.

Lighting as a service?

Lighting as a Service (LaaS) may well be part of a growing type of service used by more firms, now and into the future.

Deloitte UK, London, in “Energy-as-a-Service. The lights are on. Is anyone home?” reports that LaaS is a delivery model in which a lighting service is charged on a subscription basis rather than as a one-time payment.

“This business model has become more common in commercial and city-wide installations of LED lights, specifically in retrofitting buildings and outdoor facilities, with the aim of reducing installation costs. Lighting vendors have used the LaaS strategy to sell value-added services, such as internet-connected lighting and energy management,” the report explained.

The LaaS concept is driven by the difference that lighting makes in the overall energy consumption of residential and commercial facilities.

According to research conducted by Mordor Intelligence, Hyderabad, India, the LaaS market is expected to grow by more than 50% per year from 2020–2025. Mordor says that the market’s primary driver “includes the increasing demand for efficient lighting systems. The growing convergence of the internet of things (IoT) in the lighting system has a lower consumption of energy across various parts of the world. However, the service’s subscription program typically imposes a higher overall cost than the owner pays for the self-installation system, which can likely pose a challenge.”

As Mordor describes it, LaaS may include lighting design, financing, installation, maintenance and other services.

Lighting and energy consumption

The U.S. Energy Information Administration (EIA) estimates that the U.S. residential and commercial sectors used a combined 216 billion kWh of electricity for lighting in 2019, which represents about 8% of the total electricity consumption by both sectors and is about 5% of total U.S. electricity consumption. Lighting in the residential sector alone consumed about 75 billion kWh, or about 5% of total residential energy use in 2019. Lighting in commercial and institutional buildings, as well as public street and highway lighting, consumed about 141 billion kWh in 2019, or about 10% of their total energy consumption.

The EIA said in 2017 that energy consumption in the United States grew by 4% each year between 1950 and 2010. However, it has decreased since 2010, mostly due to more energy-efficient designs. Three years ago, the EIA put the decline at about 11% per year. LED lighting makes a significant difference in many applications—as demonstrated by WernerCo’s upgraded facility.

As the EIA explained in 2017, “No other household technology is as disruptive as lighting. Incandescent bulbs do not last long, so the installed stock turns over quickly. Air conditioners, refrigerators, dishwashers, and other appliances, in contrast, all have 10-plus year lifetimes.

“Thus, although these other technologies have also become more energy-efficient, this cannot explain the aggregate decrease. The turnover is too slow, and the gains in energy-efficiency for these other appliances have been too gradual for these changes to explain the aggregate pattern.”

The sustainability, long life, lower power consumption and brightness of LEDs has played a large part in that improvement. Electrical contractors can advise customers on a range of products.

Note: To learn more about LaaS from Electrical Contractor, read “Lighting At Your Service,” from July 2019 and “For Rent: Lighting as a Service,” from March 2018 on ecmag.com.