Industrial: Warehouses, Distribution Centers, Manufacturing Facilities
Warehouses/Manufacturing Lighting Retrofit Benefits
Warehouses and Manufacturing facilities often have long hours with as many as 2-3 shifts operating daily. They offer one of the best return on investments for lighting retrofits. Until a few years ago, if you needed to light a warehouse you only had a few choices: Metal Halide (MH), High Pressure Sodium (HPS) or T-12 fluorescent. These have been the main types of lighting used in these facilities for decades. With such long hours, bulbs and ballasts have to be constantly changed since the average life of a bulb is from 10,000 hours for fluorescents and 15,000-24,000 hours for MH’s or HPS. This results in huge maintenance costs as the owner is constantly buying bulbs and ballasts and having to pay someone to change them out. In a plant that has continuous operation that can disrupt production or even leave certain areas in the dark until someone can change the bulb or ballast.
In this economy, facility managers are constantly watching operating costs and in most cases report directly to the CFO (Chief Financial Officer) or COO (Chief Operating Officer.) With products being imported at rates lower than ever, US manufacturers and warehouses have to watch their operating costs closely.
Lighting is considered necessary and sometimes overlooked or just accepted as a non-negotiable expense. What we actually pay for is “Energy” not ”light”. For example, if you have two light sources and both use the same amount of electricity but one puts out significantly more light than the other, your two bills would be identical. Meaning, even though one is giving you a lot less light than the other, you are still using the same amount of electricity, in turn you would be paying the same amount.
This is the case in most facilities whose lighting system is 10-15 years old. Lighting wanes over time, meaning in the first year your fixtures will put out more light than in their 10th year. However, as the lights depreciate over time, you keep spending the same amount in electricity or even more each year as the fixtures become more and more inefficient.
“It can be equated to a car that used to get 20 miles to the gallon but now only gets 10 miles to the gallon. It doesn’t make sense to keep filling it up at some point you have to make the necessary repairs to get the mileage back up.”
Too often we see facilities who are paying for lighting that they just are not getting. This ends up in Commercial Buildings using as much as double the electricity than they actually need as light fixtures are way more efficient now than they were 10-15 years ago.
There are also State incentives and Federal Tax Credits available to help offset the retrofit. NJ has one of the best Incentive programs in place and has been offering $100-$200 for every fixture (400w-1000w) changed out or retrofitted, meaning if you change 50 High Bay fixtures you will qualify for $5,000-$10,000 in State Incentives. Which will greatly help to pay for the retrofit. There are also Federal tax credits available through the Energy Efficient Commercial Buildings Tax Deduction (CBTD) and Bonus Depreciation. The CBTD or EPAct (Energy Policy Act) allows a business who has installed or retrofitted his interior space with energy efficient lighting and while still meeting acceptable light levels to earn an Accelerated Tax credit of up .60 cents a square ft. For a 200,000 sq. ft. facility the Credit would be $120,000. For an exterior retrofit (e.g. Pole lighting) the owner/lease holder can use the bonus depreciation Deduction which allows the owner or leaseholder to deduct 100% of the equipment purchased in the year it was put in service rather than the typical 39 year straight depreciation. The Government has recognized the obvious benefits of retrofitting and will not be offering these state and federal benefits much longer. This Act was extended to until 12/31/2011, after 2011 the amount that can be deducted is %50. So the time to act is now, and the cost of waiting is huge. Combining these measures Warehouse/Manufacturing facilities can see an ROI of as little as 12-18 months.
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