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Consumers Begin to See the Light: LED Bulbs Save Bigly

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New independent consumer research shows a household using at least 20 light bulbs can save $1,000 or more in a decade by using new LED (light-emitting diode) bulbs rather than traditional incandescent or halogen bulbs.

A recent Consumer Federation of America (CFA) survey of 60-watt equivalent, non-dimmable, soft white light bulbs found, for example, that each of 17 LED bulbs had a total 10-year cost of no more than $15.40 while each of 15 incandescent or halogen bulbs had a total cost of at least $61. The average 10-year cost of the LEDs was $13.70, while the average 10-year cost of the incandescents and halogens was $69.49.  Since homes use an average of more than 20 light bulbs, consumers now relying on incandescents and halogens can save in the neighborhood of $1,000 over this period by switching to LEDs. 

Before 2012, consumers had a choice between the 125-year-old incandescent or the compact fluorescent light bulb (CFL), which is often distinguished by its spiral shape. In 2012, because new federal energy efficiency standards went into effect, a new class of incandescent bulbs (halogen for short) entered the market. By the last quarter of 2016, about two-fifths of socket light bulbs shipped by manufacturers were halogens.

Yet, in the past couple years, shipments of LED light bulbs, the most energy-efficient and least costly over time, rose rapidly and are now the dominant bulb displayed by large retailers such as Walmart, Costco, Target, Lowe’s, and Home Depot, though not necessarily by supermarkets, drugstores, and discount outlets.  Moreover, our recent price survey done in April found that the prices of LEDs have fallen considerably: 60 watt replacement LEDs are now available for well under $5 a bulb at most stores.

Consumer knowledge of light bulbs, however, has not kept pace with these marketplace changes.  In a June 2016 opinion survey commissioned by CFA, which was just publicly released, only 36% of respondents said they would replace burned-out socket bulbs in their living room or bedroom with LED bulbs.  In the same survey, only 36% said that they know a fair or great deal about light bulbs.

The CFA found the ten-year costs per light bulb ranged from $82.90 to $11.74, with LEDs offering significant cost savings because of their low energy usage and long life.  Over the ten year period, each of the 17 LED bulbs had a total cost of no more than $15.40 while each of the 15 incandescent or halogen bulbs had a total cost of at least $61.  The five CFL bulbs had a total cost of between $19 and $25. Based on observations at the stores surveyed, cost differences of the same magnitude exist for other popular socket bulbs such as those with 40, 75, and 100 watts, “daylight” and “clear” bulbs, and dimmables.

According to a 2015 Energy Information Administration estimate, 62% of all homes have 20 or more indoor light bulbs.  Assuming an average $55 difference between the ten-year costs of LED bulbs and incandescent/halogen bulbs, a family may well save more than $1,000 by using LEDs during the ten-year period. In addition, they can avoid the hassle of having to change the bulb every year or so.

The principal reason for the huge cost difference between different types of bulbs relates to differences in electricity consumption.  Incandescent/halogen bulbs surveyed typically consume approximately $5 of electricity a year while LED bulbs typically use about $1 of electricity annually.  The fact that incandescent/halogen bulbs often have an estimated life of less than one to two years, compared to more than 10 years for most LED bulbs, also accounts for a portion of the cost difference.

Consumers should purchase LED bulbs but not buy the first LED package they see at a local retailer.  (The CFA consumer survey found that only two percent of respondents said they buy most light bulbs online.)

• First, decide what type of bulb you want in terms of “wattage” (now lumens), type of light color or appearance such as warm yellow or daylight (measured in kelvin), and dimmability. Purchase a bulb or two of the type you think you prefer and try it out at home.

• Second, look first to the house brand light bulbs of retailers – e.g., Utilitech for Lowes, Ecosmart for Home Depot, Great Value for Walmart, Up&Up for Target – because they tend to be cheaper, and because stores are likely to resolve problems with their own brand of light bulbs more quickly. Look for those with the ENERGY STAR logo since they meet minimum light output, color quality, and warranty requirements set by the federal government.  Keep in mind that, because LEDs last so long, a $1-$2 dollar difference in the price of a LED bulb represents only a few cents annually in costs during the life of the bulb while savings from lower electricity costs represents dollars.

• Third, if your bulb does not work properly or burns out quickly, take it back to the retailer and ask for a new bulb. In the recent past, to reduce the price of LEDs, manufacturers have sometimes reduced bulb quality, as evidenced by some complaints made to the websites of major retailers. Returning the defective light bulb will serve two purposes: 1) The store will almost always provide you a new bulb, and 2) it will also encourage the retailer to complain to the manufacturer of the bulb.

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