High Benefit Lighting; More than energy savings alone.
By John P. Bachner
Reprinted with permission.
Electrical Line Magazine
Jan/Feb 2005
Energy conservation is a good thing. No one argues the point. More cost effective production is an even better thing, however, because – all things considered – more efficient production generates far more profitability than energy savings alone. When it comes to industrial facility upgrades, then, the ideal would likely be more cost effective production and lowered energy cost at the same time. Unlike many ideals, the one is 100% attainable thanks to High-Benefit lighting.
As described by the National Lighting Bureau, high benefit lighting is an energy efficient illumination system that, first and foremost, helps people optimize performance of visual tasks and achieve other objectives supported by high quality lighting. The Bureau’s archives contain a number of case histories that underscore the point. Consider this one…
The management of Metal Industries Inc. decided that the company needed better lighting to help employees work better, faster, and less expensively. With that in mind, it invested $8,000 in a new lighting system that, while energy efficient, cost about 400% more to operate and maintain than the existing one. And while the existing was less costly, it was not more energy efficient. It was old and, clearly, no longer suited for the performance of the visual tasks begin performed in the plant. So how did it work out for Metal Industries? According to National Lighting Bureau research, simple payback occurred in 37 hours, generating a near unbelievable return on investment (ROI) of 23, 741% per year. How? Because of the new benefits!
Enhanced Safety
The company’s accident rate, which was relatively low before the change, fell by 15% after the new High Benefit Lighting was installed. (Because lighting modifications were the only modifications made, the company attributed the lowered accident rate solely to better lighting). Improved safety saved the company about $3,000 per year, thanks to fewer accident clean-ups and less paperwork being required.
Fewer accidents also resulted in lower insurance premiums, saving the company an additional $3,000 per year. Even more important, fewer accidents resulted in less absenteeism, saving the company and estimated $225,000 per year.
More Productivity
The company discovered that the same High Benefit Lighting that helped employees avoid accidents also helped them improve performance of visual tasks. They were able to get more done in the same amount of time, creating a productivity benefit worth about $1.5 million annually. Employees also committed fewer errors, resulting in a 25% reject rate reduction that saved the company another $200,000 per year.
The Metal Industries case is unusual not because of the benefits realized, but because of the increase in lighting energy consumption. In most instances, National Lighting Bureau case histories demonstrate how productivity increases, safety improvements, and other benefits are achieved by making lighting system modifications that also reduce lighting energy consumption.
Consider the case of Superior Die Set Corporation (Oak Creek, WI). The company calculated its savings at about $45,000 annually, thanks to improved productivity and less down time resulting from a $3,000 lighting system upgrade that also lowered lighting operating and maintenance costs by 45%. The company also benefited from enhanced security and an improved absenteeism rate.
American Hardware Supply (Butler, PA) did even better. The company reduced its lighting operating and maintenance costs by 25% as a result of lighting system changes that also reduced the company’s accident costs by $1,000 and improved productivity by $35,000 per year. After new lighting was installed, the company recorded fewer accidents and found that its employees worked faster while making fewer mistakes. The company also credited the new lighting with improving its image with visiting customers leading to a sales increase of about $50,000 per year.
As these and many other cases show, better lighting does not necessarily mean more lighting, and more lighting does not necessarily result in more energy consumption. Better lighting – High Benefit Lighting – does mean more effective lighting and more efficiency though less energy waste. Above all, realize that the dollar value derived from more effective lighting.
As the NLB case histories also demonstrate, more effective lighting can result in less energy consumption. The trick to obtaining that kind of a lighting system, one that supports better performance and less energy consumption, is to consider energy conservation issues only after determining which lighting system upgrades will best support the particular tasks, workers, and spaces at a site.
Founded in 1976, the National Lighting Bureau provides education and information services to help organization and process managers optimize their lighting dollars. The Bureau is sponsored by manufactures, trade professional, electric utilities and agencies of the U.S. government. To achieve High Benefit Lighting, the Bureau recommends that owners and manager evaluate their existing lighting systems. Ask workers if the lighting causes problems such as eye-strain or headaches. Do they believe that improved lighting would improve working conditions? After completing an informal survey, audit the existing system. What types of lamps are being used? How well are they maintained? How much light is being produces?
A publication that provides guidance on performing self-audits is available for free download from the National Lighting Bureau’s website: www.nlb.org. Experts also are available thought a number of organizations and private companies, many of which are linked to www.nlb.org. Those performing the audit should determine the optimal lighting support for the people performing the specific tasks at the business.
Justifying Lighting Upgrades
How do you go about justifying a lighting upgrade? Consider the number of people at a plant who perform visual tasks, then calculate the annual payroll value for each. The calculation usually considers an individual’s salary multiplied by 1.35 to account for the value of insurance, paid leave, and other benefits such as retirement.
If an existing lighting system is at least ten years old, chances are new lighting would be able to boost worker productivity by at least 1%, in part because the installed lighting may no longer be optimal for the tasks performed in a space and/or where they are performed. (Research suggests that work area layouts and the tasks performed there change every 2 ˝ years.) In addition, lighting degrades over time, so ten year old luminaries (fixtures) may not provide the same amount of quality light that they did when they were new. Consider, too, that if the same tasks were performed by the same workers over a ten year period, better lighting might be required in any event, because as people age, they require better lighting to work as effectively as they used to.
Assuming that a new system will improve lighting enough to save 36 seconds per hour, a 1% productivity gain would be realized. For an annual payroll expense of $1 million, a 1% productivity boost would be worth $10,000. this figure does not include other benefits, such as savings from a reduction in accidents and the related paperwork, the improved quality of products, and the intrinsic value of generally happier workers and customers.
Consider the location of the lighting. How is the lighting used? What would happen were the lighting removed? What would happen if the lighting were improved?
Do not settle for a system that promises only improved energy efficiency. Obtain High Benefit Lighting; lighting that provides solid support for your company, your workers, and your bottom line while consuming as little energy as possible to the job done.
John P. Bachner is the Director of Communications for the National Lighting Bureau in Silver spring, MD.
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