How A Parking Garage Could Save $90,000!

The US government is pushing commercial consumers to maximize energy efficiency by promoting the use of LED lighting over High Intensity Discharge (HID) lamps.

Upgrading parking ramp and parking lot lights, like metal halide* or high pressure sodium bulbs**, with an equivalent LED product provides for substantial utility as well as maintenance savings.

*Metal halide bulb: an electric lamp that produces light by an electric arc through a gaseous mixture of vaporized mercury and metal halides (compounds of metals with bromine or iodine). It is a type of high-intensity discharge (HID) gas discharge lamp.
**Sodium bulb: Sodium bulbs are light bulbs that create an electric arc through vaporized sodium metal. They were first produced commercially by Philips in Holland in 1932. There are two kinds of sodium lights: Low Pressure (LPS) and High Pressure (HPS). These lamps are mostly used for street lighting as well as industrial uses.

Parking garage with lightingThe ideal product for this LED upgrade has:

  • a rated lifespan of 100,000 hours, with a 5 year warranty, for maximum replacement savings and project life
  • a rated power consumption of 120 watts for maximum utility savings
  • operates with no external ballast for maximum maintenance savings
  • utilizes the existing fixture for minimum installation cost.

Using an LED replacement product with these qualities creates an LED upgrade project providing for maximized utility bill, bulb/ballast replacement and maintenance savings with a minimized installation cost, which actually pays you to upgrade to LED. Here’s how it works:

The utility savings is based on the reduction in wattage. The most common metal halide lamp used in these settings is rated at 400 watts and with the required ballast operates at 440 watts. The best replacement LED product is rated at 120 watts and with the required driver operates at 126 watts, providing for a 314 watt reduction or a greater than 70% savings in energy use.

The financial savings of an LED upgrade depends on the number of bulbs replaced and the local utility rate. The annual utility savings for a project replacing only 20 bulbs is shown below:

Utility Rate Annual Savings (24/7 operation) Annual Savings (12/7 operation)
$0.125 per kWh $6,877 $3,438
$0.105 per kWh $5,776 $2,888
$0.085 per kWh $4,676 $2,338

Savings calculated as kilowatt reduction times the operational hours times the utility rate

Parking lot lightingThe maximum potential maintenance savings is realized with a replacement LED product which requires no ballast, uses the existing fixture and is rated at 100,000 hours lifetime, which is 5 times the typical life of the old bulbs and ballasts (with 24/7 operation this is over 10 years). This avoids at least five complete replacements of the bulbs and ballasts. Using conservative cost estimates ($35 replacement and $45 installation fee for each bulb, plus $30 replacement and $45 professional installation cost for each ballast) and avoiding five complete replacement cycles would save over $31,000. Installation can typically be done with your existing maintenance personnel or contracted maintenance company as the ballast only needs to be bypassed, avoiding additional electrician labor costs.

It is the total lifetime utility and maintenance savings that drives the conversion to LED. The total lifetime savings of the 20 replaced bulbs is shown below:


Utility Rate Utility Savings Maintenance Savings Lifetime Savings
$0.125 per kWh $78,500 $31,000 $109,500
$0.105 per kWh $65,940 $31,000 $96,940
$0.085 per kWh $53,380 $31,000 $84,380

*Lifetime Utility Savings calculated as annual savings (above) times the life of LED bulbs in years (11).
*Lifetime Maintenance Savings calculated as shown in #4 above.
*Total Lifetime Savings calculated as Lifetime Utility Savings plus Lifetime Maintenance Savings.

Therefore, upgrading only 20 bulbs generates a total lifetime positive cash flow of around $90,000, with a payback of your investment at around 18 months for 24/7 operation and around 24 months for 12/7 operation on the utility savings alone.

Taking advantage of lease-purchase financing on these LED products, this project can be engaged with no out-of-pocket expense on a project providing a 5 year project net positive cash flow (over project cost) against the guaranteed utility savings alone as shown below:

Utility Rate 5-Year Cash Flow (24/7 operaton) 5-Year Cash Flow (12/7 operaton)
$0.125 per kWh $25,483 $8,292
$0.105 per kWh $19,982 $5,541
$0.085 per kWh $14,480 $2,790


The combined monthly utility and maintenance savings more than covers the monthly payment in a lease-purchase scenario, creating a net positive cash flow project that actually pays you to upgrade to LED while providing maintenance and worry free lighting for over 10 years.

Effective applications of this LED upgrade could also include auto dealership outdoor lighting, gas station pump canopy lights, street lights, gymnasium lighting, security lighting and certain industrial settings.

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