Bulbs made from Light-emitting Diodes (LEDs) are the cheapest lighting solution for your home or green building.  Why?  Because LED bulbs last 25X longer than incandescent bulbs and use just 1/8 the energy.  Over an LED bulb’s lifetime, the difference amounts to several hundred dollars.

Trent Hamm at The Simple Dollar did the math for us in his series “Pennies or Dollars” and calculated the cost of bulbs and energy use over 10,000 hours.  The results are decisive.

Assuming 12 bulbs in a house, incandescent bulbs would cost approximately $55, given a 1,000 hour lifespan for each bulb.  Compact florescent bulbs (CFLs) have 4-8X the lifespan of an incandescent bulb, and the prices of CFLs have been steadily dropping for years.  The cost of CFL bulbs over 10,000 hours is roughly $32.  CFLs are less expensive than incandescent bulbs due to their longer lifespan!

An LED bulb equivalent costs around $15, so 12 bulbs would set you back $180 but they last for 25,000 hours, which is longer than the duration of the test.  The prorated cost of bulbs over 10,000 hours period is about $72.

Now we have to calculate the energy usage of each bulb over 10,000 hours.

Over 120,000 hours of use (10,000 hours per socket), a 60 watt incandescent bulb will consume 7,200 kWh of electricity.  The nationwide average price per kilowatt is about $0.12/kWh.  The incandescent bulbs will use $864 worth of energy over our 10,000 period.

In the same timeframe, 13 watt CFLs use 1,560 kWh of energy at a cost of about $187.

Comparatively, a 7 watt LED would use 840 kWh of energy at a cost of approximately $100.

By adding the price of the bulbs and the cost of energy over time, we get the total cost of ownership for 10,000 hours of lighting.  CFLs are competitive, but LEDs win hands down.  Incandescent bulbs have a very high total cost of ownership because they are extremely inefficient.  More than 90% of the energy consumed by incandescent bulbs is radiated as heat instead of light, whereas 90% of an LED bulb’s energy goes towards light.

“When it comes to residential lighting, the math really speaks for itself,” said Michelle Murray, director of corporate communications for leading LED manufacturer, Cree. “The EcoSmart LED downlight, for instance, consumes just 10.5 watts and can save nearly $70 in one year compared to a 65-watt incandescent in North Carolina, or $99 a year in California, based on electricity rates. That’s significant savings, especially when you also factor in that the LED fixtures lasts 16 times longer than a comparable incandescent and four times longer than CFLs.”

LED bulbs will only cement their leadership in lighting as their production costs continue to drop.