- Joe’s Grocery Store uses about 7,000 kWh in electricity each month.
- He enjoys a low fixed rate of 9.5 cents per kWh but he wants to reduce his energy costs without paying any money upfront.
- If he can reduce his annual electricity expense by about $2,000 that would be the equivalent of doing more than $60,000 in increased sales for the year.
- He is approached by a representative who explains the LED program to him.
- Joe’s 50 traditional fluorescent lights are replaced with high efficiency LED bulbs reducing his overall electricity consumption by 16%.
- Even paying a higher rate for the electricity for the next two years, the reduction in electricity consumption creates a small savings in the supply costs, and a large savings in the delivery costs.
- Also, the LED lighting is warrantied for two years, so he doesn’t have to change his bulbs twice a year like he was doing before – saving him money on maintenance.
- Over two years the LED program save him almost $5,000 (about 12%) overall while providing the grocery store with better, safer, brighter, more durable and more beautiful lighting.
- His customers and employees love the way the store is lit and he enjoys even more sales as a result.
- Over five years, Joe’s Grocery will save almost $15,000.
- He accomplished all this with no out of pocket costs at all and the representative has the satisfaction of knowing she helped a small business customer save money and improve his business.
| Current Electricity Bill: | – | New Electricity Bill After Installing LED Lighting providing 16% reduction in consumption | SAVINGS |
|---|---|---|---|
| Monthly Usage (kWh) | 7,000 | 5,880 | |
| Rate for Supply | $0.095 | $0.110 | |
| Supply Charges | $665.00 | $646.80 | |
| Rate for Delivery | $0.136 | $0.136 | |
| Delivery Charges | $952.00 | $799.68 | |
| Total Charges | $1,617.00 | $1,446.48 | |
| Annual Charges | $19,404.00 | $17,357.76 | $2,046.24 |
| # of Times/Year Bulbs Changed | 2 | 0 | |
| # of Fluorescent and Incandescent Bulbs | 50 | 50 | |
| Average cost of traditional bulbs | $3.00 | No Cost | |
| Maintenance Expense on Current Lighting: | $300.00 | $0.00 | $300.00 |
| Total Cost of Electricity and Maintenance/ Year | $19,704.00 | $17,357.76 | $2,346.24 |
| TWO YEAR CONTRACT TOTALS and SAVINGS: | $39,408.00 | $34,715.52 | $4,692.48 |
| Year 3 Rate is reduced creating another $1,100 a year in total savings | 3 Year Estimated Savings | $8,097.12 | |
| Total Upfront (out of pocket) Cost: ZERO | 5 Year Estimated Savings | $14,906.40 |
Examples of Energy Efficiency Analyses:
