Tuesday, 18th July 2017

The Economic Impact of a Shift to LED

Gerard Lighting
Marketing Team
Gerard Lighting

The Economic Impact of a Shift to LED

World economic indicators show that per-capita electricity usage peaked in Australia in 2007, and has declined every year since.


This could be a sign that Australians becoming more conscious of energy habits, or that household electrical appliances are becoming more efficient, affecting energy usage. Both are real trends, however technological development and energy savings as they apply to residential usage are most readily realised in our home lighting choices.


The LED link

Looking into similar trends in the US, a recent investigation by Lucas Davis of the University of California at Berkeley's Haas School of Business found a strong connection between a similar decline in residential energy consumption in the USA, and a rise in household LED adoption.** Going on an estimate of 1 billion LEDs and CFLs now in U.S. homes, operating three hours per day, Davis estimated an energy savings so far of 50 billion kilowatt-hours per year, or 160 kilowatt-hours per capita, which was equal to the decline in residential consumption across the country.

Similar trends can be found on home soil, where we are seeing an increase in the adoption of LED light sources in the home. LEDs use 85% less electricity than incandescent bulbs, are much more durable, and work in a range of indoor and outdoor settings. LED technology is also becoming ever more accessible – though it’s worth noting lamp life, poor and inappropriate colour, flickering and quality can suffer substantially in a market flooded with low-cost imports.


More lighting, yet less energy consumption

Even the trend towards building larger houses and installing more light fittings per home is not enough to negate the decrease in energy usage through LED lighting. Although we are finding more ways to use lighting in our homes (think kitchen task lighting and outdoor feature lighting that makes the most of LED versatility) we still see that the per capita energy usage rate is declining and closely correlated to LED uptake – a further indicator of the game-changing power of LED technology.

Additional spotlight on the LED revolution can be seen in current urban amenity and streetlight programs across Australia, where comparatively inefficient fittings are being systematically replaced by LED luminaires. It’s also highly likely that your local sporting ground is either lit or will be in the near term with energy-efficient, lower maintenance LED lighting.


A short-lived decrease

What is exciting about the Davis study and similar findings in Australia is the win-win situation of decreasing energy consumption, and the additional maintenance and operational cost savings of LED technology. With a marked increase in LED investment in Australia, the per capita decrease in energy usage year on year has every chance of continuing. However, while the post-2007 decrease is significant the fact remains that that Australians have been increasing their energy usage until that point since the 1950’s. Even with LED changeover momentum taken into account, without a doubt the future will see us finding more ways to increase per capita energy usage in ways that haven’t even been imagined yet.


**Davis, L, 2017 https://energyathaas.wordpress.com/2017/05/08/evidence-of-a-decline-in-electricity-use-by-u-s-households/

Related products