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switching to led light bulbs

How Much Can You Save Switching to LED Bulbs?

By Samantha AimoneRise Writer
Oct 16, 2019

Did you know the easiest way to make your home more efficient and save substantial money each month is probably shining down on you right now? If you are inside with the lights on right now, it is! Switching your light bulbs to LEDs is one of the biggest financial no-brainers in your home. 

residential energy usage

Light bulbs are small and cheap, and for those reasons, many people discount the impact they have on their home's overall energy consumption. While lighting accounts for 10 percent of a home's energy usages, light bulbs are one of the most used appliances in our homes. Added up all over the house, their impact is quite mighty! Below we will discuss how it is in your (and your wallet's) best interest to immediately replace all non-LEDs in your home. Also, get some guidance on what to look for when you go light bulb shopping.

led light bulb
LED Light Bulb. Photo Credit: Philips

What is an LED Light?

While the technology itself is over 50 years oldLEDs (light-emitting diodes) are among the fastest-growing types of light bulbs on the market. LED technology is highly efficient. LEDs are capable of producing light 90% more efficiently than incandescent bulbs. This dramatic improvement in efficiency allows the lamp to consume less energy to produce the same amount of light as other bulbs such as halogens, traditional incandescents, and CFLs

LEDs also have a "heat sink," which absorbs the heat produced by the light. With LEDs, you can avoid a "burnout" typical of overuse with older light bulbs. These new technologies increase the LED's useful life. A single LED bulb will keep working longer than other bulb types. So how does this increased efficiency in LEDs translate into your savings? Let's take a look.


The calculations for comparing the total lifetime savings of light bulbs are a bit complex. Use this LED calculator to smoothly guide your unique inputs and calculate your personalized total savings. For the sake of our comparison, we will be using the following values of standard size bulbs:

light bulb chart

Initial Price

The first comparison is the initial price for the bulbs. With improved technologies, LEDs have gotten closer and closer to the cost of older bulb types. You can buy bulk packages of 8 or 16 bulbs that will bring the price per bulb down even closer to that of a CFL or halogen bulb. LEDs initially cost more than other bulb types, but their savings over time will far make up for the slightly higher upfront costs.

What Is The Annual Operating Cost of Light Bulbs?

LED's higher efficiency allows them to use less energy to produce the same amount of light. The bulb's wattage measures the amount of energy each bulb uses. The lower the wattage, the less energy is used. The less energy used, the more money saved! To get the cost to operate a bulb, we have to look at your electricity cost—how much you pay for the watts used. Any electricity bill will have your electricity cost stated in cents per kilowatt-hour (kWh). If you do not have an electricity bill at hand, you can estimate using your state average or the national average at 13.34 cents per kWh. The equation will be:

Annual operating costs = (electricity price x average hours lights are on per day x 365 x bulb wattage) / 1,000

*Note: you need to divide the entire equation by 1,000 since the electricity price is per kilowatt-hour (1,000 watt-hours), but we want to compare based on watts.

For lights that are on an average of 6 hours a day, 365 days a year, the annual operating costs will be:

  • Annual cost to operate one LED: ($.1334 x 6 x 365 x 9)/1,000 = $2.63
  • Annual cost to operate one halogen: ($.1334 x 6 x 365 x 43)/1,000 = $12.56
  • Annual cost to operate one incandescent: ($.1334 x 6 x 365 x 60)/1,000 = $17.53
  • Annual cost to operate one CFL: ($.1334 x 6 x 365 x 13)/1,000 = $3.80

While halogens and incandescents were the cheapest initially, they cost exceedingly more to use due to higher energy requirements. They end up being five to seven times more expensive, in operating costs alone!

What Is the Lifetime Energy Cost of Different Light Bulbs?

A standard LED bulb lasts 15,000 hours. If it is on for 6 hours a day, 365 days a year, its lifetime is about 6.85 years. The difference in lifetime energy costs equals the differences in annual operating costs (calculated above) multiplied by the LED's lifetime (6.85 years based on 6-hour average daily use):

  • Halogen: ($12.56 - $2.63) x 6.85 = $68.02
  • Incandescent: ($17.53 - $2.63) x 6.85 = $102.07
  • CFL: ($3.80 - $2.63) x 6.85 = $8.01

These numbers represent how much more you will pay to operate these bulb types than an LED over the LED's lifetime. On top of that, you will have to purchase replacement bulbs over the lifetime of the LED. Lifetime replacement costs are the final piece of calculating the total lifetime savings of an LED.

How Much Do Light Bulbs Cost To Replace?

In addition to using less energy, LEDs have a much longer life—which means you need to replace bulbs much less frequently. 

To calculate replacement costs, we must calculate how many years each bulb will last based on our use (6 hours a day). Then, compared to our LED base case of 6.85 years, we will see how many times each bulb needs to be replaced, multiplied by the replacement bulbs' cost. 

  • LED: a life of 6.85 years, 0 replacements, $ 0-lifetime replacement costs
  • Halogen: life of .9 years, 7 replacements, $10.22 lifetime replacement costs
  • Incandescent: life of .91 years, 7 replacements, $8.89 replacement costs
  • CFL: life of 4.55 years, 1 replacement, $1.74 replacement costs

How Much Will LED Lights Save You?

To get the total lifetime savings of switching to LED, we look at the difference in operational costs and replacement costs over an LED's lifetime. Here's the equation:

The total lifetime savings of switching your bulb to LED = lifetime energy costs + lifetime replacement costs – the initial cost of LED.

While initially spending $2.12 (or less with bulk buying) on an LED bulb, you will be saving these grand totals on lifetime energy and replacement costs:

  • Halogen: $68.02 + $10.22 - $2.12 = $76.12
  • Incandescent: $102.07 + $8.89 - $2.12 = $108.84
  • CFL: $8.01 + $1.74 - $2.12 = $7.63

Remember, these savings are only for one bulb. The average U.S. household has at least 45 light bulbs in their home. Multiplied by 45 bulbs, your savings are as high as $343 for CFL, $3,425 for halogen, $4,898 for incandescent! The savings could be even more significant if your light bulb types have higher wattages, or you keep them turned on longer (like outside floodlights). Besides just the financial savings, switching to LEDs will save on the repeated time and effort spent to replace the bulbs over the life of a single LED.

Additional Considerations When Choosing LEDs

Light bulb shopping can be a dizzying experience of seemingly endless arrays of options. While we have shown that it is a financial no-brainer to choose LEDs, here are some other considerations. 

"Lumens" is the measurement of how bright the light is. Think of a scale: dim – soft – normal – bright - extra bright. "Normal" light is around 700+ lumens, soft is 400+ lumens, and bright is 900+ lumens. 

"K-Factor" is the "color" of the light. The higher the K-Factor, the more white the light. A K-Factor of 3300-6000K simulates early afternoon light and helps us stay productive, so it is excellent for workspaces. A K-Factor of 2700-3200K is a comforting light for bedrooms and living spaces. Smart light bulbs using LED technology let you customize the K-Factor to set the ambiance you desire. Another option is Wi-Fi LED lighting controls, allowing you to customize lighting without replacing every bulb with the more expensive smart bulbs.

Bottom Line

LED bulbs pay for themselves financially, often in a manner of months. If you are shopping on a budget and prioritize switching your bulbs, start with the lights you use the most. Those will provide you with the most immediate savings and quickest payback. If you can afford to switch all of your bulbs, don't wait until the others burn out. If you can add value now, why wait? You will be helping your pocketbook and the environment. (Make sure you dispose of CFLs properly, as they contain mercury!).

Disclaimer: This article does not constitute a product endorsement however Rise does reserve the right to recommend relevant products based on the articles content to provide a more comprehensive experience for the reader.Last Modified: 2021-06-15T03:44:00+0000
Samantha Aimone

Article by:

Samantha Aimone

Samantha Aimone is a student at Fordham University pursuing a Bachelor of Science in Business Administration with dual concentrations in finance and social innovation. Samantha is a change maker and she is driven to help businesses attain sustainability through disruptive innovation.