Is a $50 Light Bulb Affordable?

March 21, 2012

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“You’re choosing $50 lightbulbs,” Senator Rand Paul said. “Nobody understands that in America.”

BOWLING GREEN, KY - NOVEMBER 01:  Rand Paul, t...

There has been much discussion about Philips winning a $10 million award (the L prize) for affordable lighting – for a light bulb that costs $50.  Sounds crazy, doesn’t it?  Even with a 25,000 hour productive life, the bulb would cost far more than a bunch of incandescents that do the same job, right?  This seems to be a commonly held belief – but it’s wrong.

I believe that Senator Paul is correct, and this concerns me.  I believe that he is correct that many people don’t understand how a $50 light bulb could be a good thing, and I feel that this stems from a failure to understand some basic math and science concepts.

There are two factors in the total cost of ownership of a light bulb.  With a standard incandescent bulb, the cheap part is the bulb. The far more expensive portion is the electricity to power the bulb.

Cost Comparison

Let’s compare costs over a 25,000 hour lifespan :

  Incandescent $50 LED
Bulb Cost 50 cents $50
Number of bulbs 17
(1500 hour life)
Watts used 60 10
kWh used
(Watts X 25000)/1000
1500 250

I used the high end of the life for the incandescent bulbs (rated at 750 – 1500 hours), but even with this, you’ll have used 17 bulbs during the life of one of the Philips LED bulbs. So we’re comparing a $50 bulb to $8.50 worth of incandescents. OK, incandescents are still $41.50 cheaper, right?

Then we get to electricity usage. Assuming 10 cents per kWh, the $50 LED bulb will usage $25 worth of electricity. The incandescents will use $150 worth of electricity.

Total cost for the $50 LED bulb: $50 for bulb + $25 for electricity = $75

Total cost for incandescents: $8.50 for bulbs + $150 for electricity = $158.59

Now do you see why it might make sense to buy the “expensive” bulbs?

Criticism of the LED Bulbs

Here are some of the comments I hear about the LED bulbs:

If I break a bulb, it’s $50 instead of 50 cents.

Seriously, how many bulbs do you people break?  I’m 36, and I’ve broken one in my entire life – and it was a bulb I was removing.  If bulb breakage is a common problem, you might want to be a bit more careful.  Also, since LED bulbs are solid state, they are more resistant to shock and vibration – less likely to break.

There’s mercury in LED bulbs.

No, there isn’t.  You’re thinking of compact flourescent bulbs.

If I can’t recover the cost of an investment in 2-3 years, it’s not worth my time.

Anything that doesn’t have a ROI north of 33% isn’t worth your time?

Which would you rather have:

  • Product A recovers the cost of the initial investment in 18 months and has a life span of 24 months.
  • Product B recovers the cost of the initial investment in 4 years and has a life span of 10 years.

Obviously, product B is the better choice.  It takes longer to recover the investment, but it keeps saving you money for a longer period of time afterward.

The lighting is of worse quality

Honestly, I really don’t notice a difference between incandescent, compact flourescent, and LED.  Some people do.

If I sell my house or remodel, I won’t get the full savings from the bulbs.

Fair point.  It’s important to note that the break even point from the example above is 8300 hours, so even if you only have the bulb for half the life, you come out ahead.  In any case, I suspect that you have a number of bulbs in your house that are fairly resistant to remodeling efforts – perhaps the laundry room or garage?

If you sell the house, you may be able to use the existence of LED bulbs as a selling point.

These bulbs won’t last 25,000 hours

Possible.  If I had to bet, though, I’d bet that they come awful close to it.  If they even average half the estimated useful life, they still save money.

There will be cheaper bulbs next year

This is true – most likely, the cost of LED bulbs will continue to fall.  Should you replace now or wait?  The critical factor is how much you use the bulb.  If you have it on 8 hours a day, 365 days a year, that’s 2920 hours.  You’d save 146 kwH per year, for an annual savings of $14.60 (based on the 10 cents per kWh – if your cost is higher, the savings is more).  Use the bulb an hour per day, and the cost savings is  $1.83 per year (but, in theory, the bulb would last nearly 70 years).

It’s also worth noting that the Philips 10 watt LED isn’t the only game in town.  There are cheaper options, even from Philips.  You can currently buy a 4 pack of 12.5 watt, 800 lumen Philips LED bulbs for less than $100 (below) – half the price per bulb.  In fact, the total cost of ownership of the 12.5 watt bulbs will be less than the total cost of ownership of the 10 watt bulbs.  You’ll spend somewhere in the neighborhood of $6 – $10 more for electricity, but save $25 on the bulb.



A couple of points in closing:

Often, green choices cost more.  With the LED bulbs, you can save money at the same to you help control dependence on foreign energy (since the energy saved in lighting can be used elsewhere).

While much of the criticism of the bulbs pertains to their use by consumers, industrial use of LED bulbs are a big part of the cost savings.  The city where I work recently replaced bulbs in city parking garages with LED.  Not only is there cost savings from the energy usage, but it also reduces the maintenance of replacing the bulbs.  LEDs are also a popular choice for traffic lights, where extended bulb life can make the streets safer.

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3 Comments (+add yours?)

  1. Martin Kelly
    Mar 22, 2012 @ 12:31:22

    Kosmo, interesting arguements. Your math is impecable, but your dismissal of the criticisms is a little off hand. First, the mercury concern is just bring up the pollyanna view of the compact flourescent. What are the hiden costs? The LEDs are mounted on a board with power conversion components. Is there something in there that has to be handles carefully. Second, the lifespan is really overstated. That lifespan is to when the bulb is completely dead. Half of the LEDs will fail within 10,000 hours driving many people to want to replace the unit. Finally, lighting will not have much effect on our foriegn oil problems. Our electricity primarily comes from coal fired plants, but every little bit will help.

    Although I have not done the math, the LED bulb should still be an economically positive option for individuals and organizations alike. The econmy of scale obviously make it better for municipalities and companies. I personally will wait for the costs to come down and the products to be more reliable. I bought a hybred car several years ago and did not get the gas efficiency promised. I will let others be the test beds for now.


  2. kosmo
    Mar 22, 2012 @ 12:48:42

    “the lifespan is really overstated. That lifespan is to when the bulb is completely dead. Half of the LEDs will fail within 10,000 hours driving many people to want to replace the unit.”

    Actually, that’s not the case for the Philips bulb. The 25,000 hours is the useful life, not the point where the bulb is completely dead.

    According to this, LEDs lose only 5-10% of their output over 20,000+ hours, as opposed to an incandescent losing 10-15% over 1000 hours.

    ” the mercury concern is just bring up the pollyanna view of the compact flourescent.”

    I only bring this up because I have heard people mention it about LEDs, and regardless of how dangerous the mercury in the CFs are, it’s a complete non-issue with LEDs (since they contains none) and so the argument should immediately be dismissed.

    The real world break-evens should be better than what I show, because I erred on the cheap side for electricity. The more expensive the electricity, the lower the break-even number of hours. At 15 cents per kWh, the break even would be just over 5500 hours.

    At this point, CF actually has the lowest total cost of ownership of the three, but the politicians seem to be characterizing this debate as LED vs. incandescent.


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