Actual Savings: LED vs. CFL bulbs (an update)

Ever since LED light bulbs first came on the market, there has been a lot of debate about whether they were superior to compact fluorescents. From the start, LED bulbs clearly had some advantages over the older CFLs, such as:

• Lower energy use
• Longer lifetime
• Contain no mercury, so a broken bulb isn't a hazard
• Dead bulbs can be safely disposed of at home
• Reach their full brightness immediately when lit
• Produce steady light with no flickering (actually, modern CFLs don't flicker enough for me to detect at all, but some people claim that they still notice it)

On the other hand, the early LED bulbs also had a distinct set of disadvantages, such as

• Directional light (illuminates only the spot it's pointed at, not the whole surrounding area)
• Cold, bluish light (this was also a problem with early CFLs, but "soft white" CFLs were available well before soft white LEDs)
• And the big one: high initial cost. When I first attempted to analyze the differences between CFLs and LEDs back in 2008, I couldn't find an LED bulb equivalent to a 60-watt incandescent for less than $55.

At the time, I crunched the numbers to calculate cost of both CFLs and LEDs over 50,000 hours of use and concluded that the LED was indeed cheaper, but only just. Using one LED in place of 6 CFLs would save about $13 over a period of about 16 years—and during that time period, the price of LEDs was sure to drop considerably as the technology improved. I concluded that it made most sense to continue using CFLs until LED prices came down. Two years later, I revisited the issue in this blog post and found that LEDs' edge over CFLs had actually narrowed as both bulbs came down in price: at that time, an LED would only save you about $2.50 over its lifetime. Since the initial cost of the LED was still $43, I concluded that waiting to replace your CFLs was still the smart choice.

Since then, I've kept a casual eye on the price of LED bulbs, glancing at them each time we passed the lighting aisle in Home Depot to see how much they cost. Over the past few years, they dropped pretty steadily, falling below the $20 mark and, recently, even below $10—but the bulbs available for sale were mostly equivalent in brightness to a 40-watt incandescent, while the CFLs we used at home were generally 60-watt equivalents or brighter. When one of the CFLs in our kitchen fixture burned out last summer after 6 years of service, we ended up buying another CFL to replace it because we couldn't find an LED of comparable brightness at a reasonable price. However, last week, on a trip to IKEA, I spotted some LED bulbs on sale for just $7 each, and I decided perhaps it was time to crunch the numbers again and see whether LEDs had finally pulled ahead of CFLs as a better overall investment.

To get a reasonable idea of how much different types of bulbs cost in the store, I went to HomeDepot.com and looked at the lowest-priced bulb in each category: incandescent, CFL, and LED. I also looked at two different levels of brightness: around 500 lumens, the equivalent of a 40-watt incandescent bulb, and 850 lumens, equivalent to a 60-watt incandescent. All the bulbs in my comparison are "soft white," with a color temperature of 2700 kelvin—the warm, yellowish shade of the incandescent bulbs most of us grew up with. In the 500-lumen category, we have three competitors:

1. The Philips 40-watt incandescent, priced at $1.62 for 4 bulbs, or 40.5 cents each: brightness 500 lumens, power use 40 watts, 1,000 hour lifetime.
2. The Eco-Smart 40-watt equivalent CFL, priced at $5.85 for 4 bulbs, or $1.46 each: brightness 550 lumens (10 percent brighter than the 40-watt incandescent), power use 9 watts, 10,000 hour lifetime.
3. The Cree 40-watt equivalent dimmable LED, priced at $5.97 per bulb; brightness 450 lumens (90 percent of a 40 watt incandescent), power use 6 watts, 25,000 hour lifetime.

The first thing that's apparent from these numbers is that the longevity of LED bulbs has actually dropped over the past few years. In 2008, a 60-watt-equivalent LED had a claimed lifetime of 50,000 hours; by 2010, it had dropped to 35,000; and now it's only 25,000. Perhaps manufacturers found they could make the bulbs a lot more cheaply by cutting back on durability, and their lifespan was still long enough for most customers to consider them a lifelong investment. On the other hand, maybe the initial estimates of bulb life back in 2008 were grossly exaggerated, and manufacturers have simply dialed down their claims as real-world results showed that the bulbs weren't lasting nearly that long. Whatever the reason, it's clear that the advantage LEDs have in longevity isn't nearly as great as it initially appeared. They'll last twice as long as a comparable CFL, but they won't last six times as long.

Their advantage in terms of power use also isn't nearly as great as early claims made it appear. An article about LED bulbs that appeared in the Dollar Stretcher newsletter back in 2008 said that they "consume roughly 1/4 the electricity needed to fire up a CF." My own calculations at the time found that this claim was way off: a CFL equivalent in brightness to a 60-watt incandescent used 14 watts, while an LED of comparable brightness used 8, for a savings of only 43 percent. Yet the difference between the bulbs listed above is even smaller. The 6-watt LED uses two-thirds as much power as the 9-watt CFL, and on top of that, it isn't as bright. If you calculate the efficiency of each bulb in lumens per watt, it comes to 12.5 for the incandescent bulb, 61 for the CFL, and 75 for the LED. Far from using only 25 percent as much electricity as the CFL, it's not even 25 percent more efficient.

So how do these three competitors stack up in terms of lifetime costs? Well, to keep a room lit for 25,000 hours, you'd need 25 incandescent bulbs costing a total of $10.13. They'd use a total of 1,000 kilowatt-hours (40 watts times 25,000 hours, divided by 1,000), which, at the current nationwide average of 12.31 cents per kWh, would come to $123.10. Total cost for incandescent bulbs: $133.23. Over the same period, you'd go through 2.5 CFL bulbs, at a cost of $3.65, and they'd use up 225 kWh of power, costing $27.70, so your total cost would be $31.35. Or, you could use just one LED bulb, costing $5.97, and 150 kWh of electricity, costing $18.47, for a total of $24.43. You'd save $6.92, but your room would be about 20 percent dimmer the entire time.

Now, let's look at the competitors in the 850-lumen category:

1. The Philips Soft White 60-watt incandescent, priced at $1.62 for 4 bulbs, or 40.5 cents each: brightness 860 lumens, power use 60 watts, 1,000 hour lifetime.
2. The Philips Soft White 13-watt CFL, priced at $7.98 for 4 bulbs, or $1.99 each; brightness 840 lumens (just barely dimmer than an incandescent), power use 13 watts, 12,000 hour lifetime.
3. The Cree 60-watt equivalent dimmable LED, priced at $7.97 per bulb: 800 lumens (only 93 percent of the incandescent's brightness), power use 9.5 watts, 25,000 hour lifetime.

Crunching the numbers for these three bulbs, we find that over 25,000 hours of use, you'd use 25 incandescent bulbs, costing $10.13, and 1,500 kWh of power, costing $184.65, for a total of $194.78. CFLs would cost you $4.15 for 2.08 bulbs and $40.01 for 325 kwh of electricity, totaling $44.16. And a single LED would cost $7.97 for the bulb and $29.24 for 237 kWh, totaling $37.20. Once again, the LED bulb edges out the CFLs over the long haul, saving you $6.96—this time with only a slight loss of brightness in the room.

It looks like in the past few years, LEDs have increased their lead over CFLs in terms of long-term savings, but not by a huge amount. However, we're also talking about a shorter payback time than we were a few years ago. A $43 LED purchased in 2010 would take 35,000 hours of use—over 19 years for a bulb that burns 5 hours a day year-round—to yield a mere $2.50 in savings. A return of $2.50 on an initial investment of $43 over a 19-year period is...well, I'm not sure of the exact formula, but it's pretty pathetic. Buy an equivalent LED bulb today, however, and you'll spend only $7.97 up front and get back $6.96 in savings over a period of only 13.7 years. Looked at as an investment, that's still pretty unimpressive, which is the reason I'm not about to go replacing any of my existing CFLs with LEDs. But once those CFLs burn out and I need to replace them anyway, I can go ahead and spring for new LEDs with a reasonable level of confidence that they'll be worth it in the long run. And, as a bonus, I shouldn't need to replace them again for at least 13 years.