the ROI on LED

Did you do a break even analysis yet? How long will it take you to recoup the expense?

The way to calculate break even (or Return On Investment) is to know roughly how much each bulb costs to use. To determine that, I built a spreadsheet that listed all 49 light fixtures in my house, the number of bulbs in each fixture, watts per bulb, lumens, and the estimated hours of monthly use. From that list, I picked the 24 most expensive bulbs to operate and replaced them with LEDs, at the cost of $217.


  • Halogen track lights are horrifically inefficient. Replace immediately.
  • Old transformers are terribly inefficient. Replace immediately.
  • LED track light bulbs are hard to find locally and horrifically expensive. Instead, buy direct from China.
  • Considering their lumen output, 4′ fluorescent bulbs aren’t that bad
  • The ROI is usually less than a year for bulbs used more than an hour a day

For the bulbs in my “top 24” list, the ROI period was less than 12 months, and that was purchasing the bulbs at late 2012 prices. Today I can buy most of those bulbs for about 30% less, so the ROI is even faster. Today at Costco, I purchased 850 lumen dimmable LED bulbs for $8 each.

Also consider that many of the bulbs I replaced were CFL. The savings in going from CFL to LED are much lower than when switching from incandescent, lowering my ROI. But the instant on, dimming, and improved light quality of LED bulbs make the switch worth while.

What LED’s do you recommend?

I recommend whatever LED bulbs cost about $10 for 850 or more lumens. I would buy them only at a local store with a good return policy. Out of 40 bulbs, I’ve had two fail. At $10/ea, they cost just enough that it’s worth taking them back for an exchange.

It’s worth noting that both my bulb failures were on the same power circuit as the 12v track lights, and I suspect the 12v power transformer played a role in their failures.

Did you bypass CFL altogether?

We used many CFL bulbs from 2009-2012. The light quality of the earliest ones was quite awful, so we confined them to areas where that didn’t matter. Price was never an issue, as Seattle City Light subsidizes them: a 6-pack of CFL bulbs has cost $1 for years now. As CFL bulb quality improved, CFL bulbs found their way into more rooms. But unlike LED bulbs, they never became good enough that we¬†liked them.

Leave a Reply

Your email address will not be published. Required fields are marked *