Do Energy Efficient Lights Really Save Money?

Energy efficient lighting is at the top of most lists discussing, “how to save money in your home.” With the higher cost of these bulbs, many consumers begin to wonder if it’s really worth the extra cost. There are several factors that determine the amount you save and whether you should invest in the more expensive light bulbs.

The top three factors include the number of hours the light remains on, the wattage used, and the cost of power in your area. Let’s take a closer look at these factors and how they will influence your actual savings.

There are three primary types of replacement light bulbs used in residential homes today. The incandescent, compact fluorescent (CFL), and LED.

Incandescent Lightbulbs

Incandescent bulbs are the traditional lights used in most fixtures. Their design has not changed much since Edison invented the light bulb in 1879. The bulbs produce an electric light through incandescence, which is the emission of light by heating the filament. Companies have improved the filament to extend the life of the lightbulb, but these typically only last around 1,000 hours. Vibrations, power surges and other factors can break the filament, causing the light to go out prematurely.


  • Lower initial cost
  • Can dim, easily
  • High light output
  • Warmer color in comparison with CFLs
  • Switched on immediately
  • Widest selection of sizes, shapes, and wattages


  • Not energy efficient
  • Higher operating cost
  • Low lumen per watt
  • Burn hot
  • 1000 hour average life
  • Not durable

Compact Fluorescent Light Bulbs

Compact Fluorescent bulbs, or CFLs, are miniature versions of the four and eight-foot bulbs found in most office buildings. Technological advancements have improved the light color and shape to adapt to most household settings. Consumers save money by reducing the wattage used for the same light output. For instance, a 22-watt CFL will produce approximately the same amount of light as a 100-watt bulb. They burn brighter and cooler than traditional incandescent bulbs. CFLs also come in a warm white color option, which mimics the color of regular light bulbs.


  • Up to 4 Times more efficient
  • Last up to 10 times longer
  • Choice of color rendering
  • Lower carbon emissions
  • Burns cooler than incandescent bulbs


  • Higher initial cost
  • Does not always work with dimmers
  • Not good for outdoor applications
  • Frequent on/off use reduces the life of the bulb

LED Bulbs

Light emitting diode, or LED bulbs, allow an electric current to pass through a microchip. Through this process, the LEDs are illuminated resulting in light. The heat produced by LEDs is absorbed in the heat sink. The latest innovation in lighting produces light that is 90% more efficient than incandescent options. LEDs produce instant and dimmable light, with a high amount of lights at very low Lumens. They are also more durable than both incandescent and CFL alternatives.

The small size of the LED allows manufacturers to insert them directly into fixtures, Christmas lights and many other applications. However, fixtures without an adequate way to release the heat build-up could result in the premature failure of the bulbs.


  • Small nature fits most applications
  • 90% more efficient than incandescent
  • Last up to 50,000 hours
  • More durable and without filaments
  • Will fit cold temperature applications


  • Higher upfront cost
  • Bright light creates more eye strain
  • Heat buildup can shorten bulb life
  • Sensitive to voltage spikes

Incandescent Light Bulbs Versus LEDs

Incandescent bulb costs between $1 and $2 per bulb. A single 60-watt incandescent light operating an average of five hours per day will cost approximately $10 per year in energy use. You can use an online calculator to adjust for the wattage, hours and energy costs in your home.

LED bulbs can cost an average of $5 per bulb and can last between 25,000 to 50,000 hours, depending on the manufacturer. Replacing a 60-watt incandescent bulb will only require an 8-watt LED bulb or a 13 watt CFL. Both will save money on energy costs.

Switching to a more energy efficient light bulbs, you could save over $300 annually. However, if you convert from CFLs to LEDs, the difference is less drastic.

How to Calculate Savings

The U.S. Energy Information Association has determined Americans pay between 9.1 and 28.5 cents per kilowatt-hour, depending on where you live. If you live in a high-cost area, you will achieve faster savings due to higher energy costs.

The following example shows the savings you can achieve over time and assumes three hours of use per day.

Energy Cost Estimates per Bulb
Years in Use Incandescent CFL LED
2 years $18 $3.90 $2.70
5 years $45 $9.75 $6.75
10 years $90 $19.50 $13.50
20 years $180 $39 $27
50 years $450 $97.50 $67.50

Both CFL and LED light bulbs have a higher initial cost. However, the lower wattage uses less energy, and the longer life will save money on replacement costs.

Estimated Cost of Replacing Bulbs Over Time
Cost to Replace Incandescent CFL LED
2 years $2.5 $0.62 $0.33
5 years $6.25 $1.55 $0.83
10 years $13.50 $3.10 $1.66
20 years $27 $6.20 $3.33
50 years $67.50 $15.50 $8.33

Because energy efficient options last longer than an incandescent, you will recover the higher initial costs with less frequent replacements needed. The average incandescent lasts only 1,000 hours compared to a CFL, which will last around 10,000 hours, and an LED which will burn up to 50,000 hours.

Total Cost of Light Bulb Replacement Costs (The following calculations assume each light bulb operates an average of 3 hours per day and the average home needs 40 bulbs)
Total Cost Incandescent CFL LED
40 bulbs for 2 years $820 $180.80 $121.20
40 bulbs for 5 years $2,050 $452 $303
40 bulbs for 10 years $4,100 $904 $606
40 bulbs for 20 years $8,200 $1,808 $1,212
40 bulbs for 50 years $20,500 $4,520 $3,030


As prices for CFL and LED alternatives fall, the benefit to consumers rise. You can typically save a significant amount of money in both reduced energy and replacement costs by converting household fixtures to more efficient options.

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