LED Tubes Replacing Fluorescent: How Long to ROI?

A construction data company has modeled the cash flow on a florescent replacement project in an academic setting. The payback was longer than you might think.

Reed Construction Data's subsidiary RSMeans is in the business of providing estimation software, tools, and consulting to the construction industry. It just published a brief study (PDF, registration required) in which engineer-editor Adrian Charest, PE, LEED AP BD+C, modeled a number of aspects of a two-story, 150,000-ft.² (13,936 m²) college classroom building. He plugged in real numbers -- energy costs, weather data, labor costs, etc. -- from the local (Boston) economy.

The study was set up to track costs of fluorescents and LEDs across 20 years and see when, or if, payback occurred for an LED installation. The final result might prove shocking to those accustomed to thinking in terms of a two- or three-year ROI, or even faster, for LED retrofits in commercial spaces. The study came up with a range from 14.5 to 19 years for payback in this particular setting.

For modeling fluorescent lighting, two different re-lamping models were used: the group method, where all lamps are replaced at one time, and the spot method, where individual lamps are replaced as they fail. (For the LED scenario, the L70 lifetime of the lamps exceeded the study's 20-year time-frame, given the duty cycle.) Spot replacement yielded a 14.5-year ROI and group re-lamping at 19 years.

LED and fluorescent comparison. Both curves for fluorescents start at $178,000, the difference in installed cost for LEDs versus fluorescents.

(Source: RSMeans)

Details, details

One purpose of this study was to demonstrate use of the sponsoring company's datasets and estimating tools, and Charest used them liberally, along with other construction-industry resources, applications, and databases. The facility was modeled using an RSMeans dataset, and then lighting levels were determined from IES equations. From these the required numbers of three-lamp fluorescent and LED-tube troffers was determined. The rated lives were 15,500 hours for the fluorescent tubes and 50,000 hours for the LEDs to L70.

Since the application was in an academic setting, the hours of operation were modeled considering in-session and out-of-session periods.

From the energy-use numbers, I deduce that the efficacy of the chosen LED tubes (which were not named by brand, if indeed a particular model was even identified) was only 11% or 12% higher than that of the fluorescents. If a typical number for T8 fluorescents is 87 lm/W, an LED tube with a net efficacy of around 97 lm/W fits the bill. (The study's model came up with an annual electric consumption of 738,000 kWh for the fluorescents and 654,000 for the LEDs.)

Take a look at the full details of the study's modeling. Though it did not include considerations such as inflation, variations in energy costs over time, or declining prices for LED products, the study nonetheless captured more nuance than other ROI exercises I have come across. How realistic do you think a one-to-two-decade payback is for such a retrofit?

— Keith Dawson, Editor-in-Chief, All LED Lighting