A Christmas LED Special

Do Christmas LEDs Pay for Themselves?

Our updated light display
now at my office

Each year LED Christmas lights become more widely available and better priced. But they're still on the expensive side. Old-style incandescent lights go for under $3 for a 100-light string, while LEDs start at about 4 times as much at $12 per 100.

Of course there are numerous reasons to buy LEDs:

• in theory they should last forever
• they can have color-changing and other novel features
• you can string many 100s together on a single circuit
• they are more durable and shock-resistant without filaments or glass 
• they generate less heat, so less chance to start a fire (though MythBusters busted that myth)
• it's just the right thing to do since they use so much less energy

But do they pay for themselves? More precisely, how long does it take, and how much electricity-cost do they save?

The old 50 lights burning 21.6 Watts

Case Study
We have some really old "Jesus" lights we put together right after we got married. We wanted a simple reminder of the kernel of Christmas in our apartment window, so I got some poster board and a string of 50 lights and spelled out the name Jesus, one letter in each pane of the balcony window. That string of lights is still working after 25 years(!)

But the lights are sure to burn out someday, and they consume 21.6 Watts of electricity. What about replacing them with LEDs? Even by doubling the lights to a 100-light LED string, the new string uses only 3.9 Watts of power.

New 100 LEDs burning 3.9 Watts

Note that the claims of 80% and 90% energy-savings on LED packaging are real, not just hype. 4 Watts of LEDs can replace 44 Watts of incandescents--that's just 9% of the power!

But what is the cost savings? Assume the lights burn for about 6 weeks (Thanksgiving through Three Kings Day, January 6) for 6 hours a day. Using my rule of thumb (that 1 Watt costs $1 per year), the cost of each string is:

50-light 22 Watt string:
21.6W x 42days/365 x 6hours/24 = $0.62

100-light 4 Watt string:
3.9W x 42days/365 x 6hours/24 = $0.11

So the new string saves 1/2 dollar a year. It will pay for itself in just 24 years! We can celebrate the savings at our 50th wedding anniversary. Well...the change has to be justified on principle and other ancillary grounds, such as, that 100 lights look better than the skimpy 50-light array.

Of course, if replacing 100 lights with 100 lights, the savings would more than double to $1.13 per year (= 0.62 x 2 - 0.11), so the payback period would be cut back to just 11 years.

Other Factors
Plus there are other factors that affect the payback calculation:

New strings
For a new string, the payback time is based on the cost difference between incandescent and LED strings. For a 100 light comparison, the price difference is $9, while the energy savings is about $1.13 per year, so the payback is about 8 years.

Discounts for recycling
Home Depot has an annual recycling program in early November each year at which they give away $3 to $5 coupons per string. This brings the payback time for replacement strings down to the same 8-year level as for new strings.

Reduction in future prices
Next year the price for LEDs is likely to continue to drop, further reducing the payback time. If a 100-light string drops to $9, the price difference will be $6, and the payback time will be 5.3 years. So plan ahead and keep an eye on the prices each year.

Rise in future energy costs
On the other hand, future energy prices are likely to rise, which also shortens the payback. By the end of the 24 year case study above, I expect energy prices to more than double. If they rise 6% a year, they'll quadruple! Based on 6% increases, a 24-year payback decreases to 14 years before accounting for inflation. If overall inflation runs at 3%, the term extends back out to 17 years. But that case study was skewed--because it doubled the number of lights.

On a light-for-light comparison with 6% increases in energy cost, the total replacement cost (without a coupon) is recovered in about 8 years, while the extra cost for a new string is recovered in about 6 years. (In each case, the 3% inflation adjustment is only +/-1/2 year.)

Bottom line
If you are going to buy new strings, definitely go for LEDs. Payback isn't immediate, but it's measurable. Know it's the right thing to do, and it will pay you back too.

If you are thinking of upgrading strings of lights, next year just might be the year! Plan ahead. Take advantage of coupons and discounts.

Christmas-Light Rules of Thumb
Just to have some ballpark numbers I can remember, let me summarize some rules of thumb.

100-light string	Each Christmas
incandescents	cost over $1
LEDs	cost about 10¢
LEDs	save about $1

So 20 incandescent strings show up measurably on your January bill by $20+, while 20 LED strings is imperceptible.

More Considerations
When choosing LED Christmas lights:

1. Look for the Energy Star label. Energy Star compliant strings have been independently tested not only for energy use, but also for weatherization (if rated for outdoor use), longevity, protection against overvoltage, and they include a 3-year warranty.
2. Look for "always on" technology--so the string stays lit even if one bulb is broken, burns out, or is removed. If a string doesn't advertise this feature, assume it doesn't have it.
3. Stores do not stock many colors, but more colors are available online. Online suppliers also stock white wire and brown wire options along with green.
4. Watch the whites: do you want blue-white, pure-white, or warm-white? Even among the same designation from the same maker, there may be variations, so be aware as you look.

Always Recycle!
Finally, don't just throw old strings into the dump. Even if you don't need the coupon, take your strings to Home Depot next year. Or search for other local or mail-in recycling alternatives. Here are some web alternatives I found that also claim to give discounts: Christmas Light Source, Environmental LED, HolidayLEDs.

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Arise, shine, for your light has come,
   and the glory of the LORD shines over you.
For look, darkness covers the earth,
   and total darkness the peoples;
but the LORD will shine over you,
   and His glory will appear over you.
Nations will come to your light,
   and kings to the brightness of your radiance. (Isaiah 60.1-3)

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Our new light display at home