Annual savings per fixture equal the watts you save, times the hours the lights run, times your electric rate, divided by 1,000. Payback is the project cost divided by the annual savings. Most commercial LED retrofits from metal halide or fluorescent pay back in a few years, faster when the lights run long hours.
The formula
Annual savings = (old watts minus new watts) x hours per year x rate per kWh / 1,000
Use the real input watts of the old fixture, including the ballast. A 400W metal halide fixture typically draws about 450 to 460 watts with its ballast. Use the LED fixture's listed watts at the setting you will run.
Worked example: 400W metal halide to LED
| Input | Value |
|---|---|
| Old fixture with ballast | 455 W |
| New LED high bay | 150 W |
| Watts saved | 305 W |
| Hours per year | 4,000 (about 16 hours a day, 5 days a week) |
| Electric rate | $0.15 per kWh |
| Annual savings per fixture | 305 x 4,000 x 0.15 / 1,000 = $183 |
Fifty fixtures in that building save about $9,150 a year in energy alone. Divide your installed project cost by that number to get simple payback in years. Plug in your own rate and hours, since both vary a lot.
Savings beyond the bill
- Maintenance. Metal halide lamps need relamping every couple of years, often with a lift. LED fixtures last far longer.
- Controls. Occupancy sensors and dimming cut hours in spaces that sit empty.
- Demand charges on some commercial bills drop with lower connected load.
- Cooling. Less wasted heat in conditioned spaces.
Rebates
Many utilities pay rebates on DLC listed fixtures, which shortens payback further. Programs differ by utility and change over time, so check yours before you order. See how utility rebates work and DLC listings explained.
Common questions
How do I calculate LED energy savings?
Multiply the watts saved per fixture by the hours the lights run each year and your electric rate per kWh, then divide by 1,000.
What is a typical payback for an LED retrofit?
Commercial retrofits from metal halide or fluorescent commonly pay back in a few years, and faster where lights run long hours or rebates apply.
Should I use the lamp watts or the fixture watts?
Use the full fixture input watts, including the ballast, for the old fixture.
Price your fixtures: high bays, 400W metal halide replacements and fluorescent troffer replacements. Questions? Contact us or call 845-681-2684.
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