LED Light Financing Options


Hopefully, we’ve shown the long term savings of switching to LED lighting and it’s not the “payback in 15 years” proposition that solar and other energy improvements have offered from the past.  It’s likely 12 months and that doesn’t take into account the government rebates which can half that amount of time.  It does require an investment up front but even that is no longer a roadblock to taking advantage of 90% savings on energy afforded by LED lights.  Let’s look at the three most common approaches to financially bankrolling the LED lighting change.


There’s the first and quite honestly, most common approach of just buying the bulbs outright.  You keep all the savings and the amount of time to reclaim your initial investment from energy and bulb replacement savings will likely be from ½ to 1 year with available rebates.  From month 1 (actually, minute 1) that the lights are on, you’re recouping your investment from the local utility.  The vast majority of residences and businesses that make the switch to LED’s go this direction and we’ll explain why after discussing the other two options. 


The next approach to soften the blow of our up-front bulb purchase is to finance the purchase with a third party equipment leasing company.  We have partners who are ready to offer this financing.  The interest rates generally run between 7 and 10% depending on the size of the loan and the duration on which it’s paid pack.  The durations of the loan are either 36, 48, or 60 months and the total value breaks for interest are $50K, $100K, $150K, $300K+ with interest rates decreasing as the value goes higher.  We’re happy to run a quote for you to finance your LED project while putting together the full light quote for you.  The quote will show your monthly payments as well as your total payments.  You can look at the monthly payment versus your prospective monthly savings for a net difference realizing that the savings beyond the loan period is all yours.


Finally, a company can just open a letter of credit which is drawn down and paid back with the savings resulting for significantly reduced energy use and bulb replacement costs. 


What do most people do?  Although we’d all love to smooth out the initial hit of the bulb purchase, 90% of LED converts buy the bulbs outright even when given the other two options.  It’s simple.  Why save 80% when you can save 90% (a potential savings minus the cost to finance).  It is money in your pocket.  You typically only finance when cash flow prevents you from buying the bulbs up front.  Otherwise, your energy savings will offset the initial purchase starting in month 1.  The first 6-12 months depending on cost of energy, government rebates, wattage replacement reflect a sliding scale where you recoup 1/6 to 1/12 of your initial bulb purchase each month.  Every month brings cash flow relief which continues long after the LED lights have been purchased outright. 

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