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Commercial Lighting Retrofits Part III: Maximizing Return on Investment (ROI)

Posted by CLS Admin on November 19, 2013


Return on Investment – ROI, as it’s commonly known. For many companies, financial analysts, and even homeowners, it’s the key metric used to gauge the merits of a potential investment.

ROI is a quantitative measure – it’s a bottom-line number that serves an important decision-making purpose. Here at CLS Facility Services, we use ROI all the time. But, many decisions, in business and in life, aren’t based on only one measure. Lighting retrofit projects are a prime example of this.

Lighting retrofit ROI is calculated by dividing the total cost of a project by the annual energy savings it creates. Often, the energy savings achieved through a lighting retrofit is significant enough to justify the project. Yet energy savings is just one of many benefits that lighting retrofits offer. When you add all of them up, we think it makes a compelling case.

Whether your facility is an office complex, warehouse, industrial facility, retail store, school or parking garage, consider your lighting and all of the elements involved, and ask yourself:

  • Is your facility’s interior and exterior lighting as energy efficient as it can be?
  • Are occupancy sensors installed to turn off lamps that only require use during a small percentage of the day?
  • Is exterior lighting on a timer or photo cell so that it is only illuminated when necessary?
  • How much is being spent in materials and maintenance to change burned out lamps and ballasts over the course of a year?  Over five years?
  • Are you currently paying to replace four lamps in an area where two lamps could adequately illuminate the space?
  • How much did it cost to rent that lift to change three lamps in your parking lot last year?
  • How much is being spent to recycle old lamps and ballasts with mercury? Are you even recycling them in accordance with the law?
  • Did you take advantage of the utility rebate like the business up the street that performed a lighting retrofit which, by itself, paid for 30% of the project?
  • Are all exit signs LED at your facility?  These offer the greatest savings of all, since they are on 24/7/365.

Just by asking these questions and analyzing your answers, we think you’ll realize that the financial benefits of lighting retrofits go far beyond simple energy savings. No matter the size of your business, hundreds – oftentimes thousands – of dollars are being spent on materials and maintenance to change the lamps and ballasts at your facility every year. 

Did you know that most new lighting technologies last 5-12 times longer than their outdated predecessors? In addition to energy savings ranging from 20-80% with a lighting retrofit project, imagine the maintenance/material savings saved over a five-year span, when new technologies are under warranty following a successful lighting retrofit project.

We’d like to offer a few hints to help you maximize your ROI for a lighting retrofit project:

  • Consider all methods of lighting-related energy conservation: wattage reduction, occupancy sensors and ‘de-lamping’.
  • Don’t forget to retrofit exterior lighting! For many businesses, exterior lighting has the longest burn time.
  • Take advantage of all utility rebates and EPA tax deductions. These can help to offset a large portion of lighting retrofit project costs.
  • Make sure to utilize technology with a long rated life, which can equate to significant maintenance/material savings.
  • Don’t underestimate the incredible impact that a more well-lit facility can have on your business – better employee morale, increased work efficiency, a more aesthetically-pleasing facility, a safer work environment, and fewer maintenance issues that impact employees and the operation of your business.

Next time, we’ll provide some tips on implementing interior lighting retrofits.

Until then, please call us at 800-548-3542 to learn more about commercial lighting retrofits and national lighting services.


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