2. Table of Contents
Page
Introduction and Background 3
Executive Summary 3
Implications and Recommendations 4
Competitive Technology Review 5
RightLumen™ Lighting System Comparisons 8
Financial Assumptions 10
Appendix – Product Spec Sheets 12
A. Lusio (E3 Building Solutions)
B. Digital Lumens (Groom Energy)
C. Albeo Technology
D. Neptun Lighting
E. EPS Energy Services
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3. Introduction & Background
The SWD Company based in Addison, Illinois is a metal finishing, coating and sorting company
with a mission that includes environmentally responsible manufacturing. The company has
strategically positioned itself of that by achieving ISO Certification to meet stringent
environmental standards that demonstrate their stewardship to business and the local
community.
The rise of emerging solid state lighting (SSL) is driving a significant transformation of the
lighting industry. SWD expects to leverage new technologies to lower energy costs within their
existing manufacturing facility and integrate SSL into plans for facility expansion in 2012.
The market has been recently flooded by a vast number of new and unproven lighting
manufacturers. Some make dubious claims about performance that are too good to be true or
not supported on a technical basis. As things stand, it can be difficult to know who to trust or
what to believe. As part of this, SWD has commissioned Outsourced Innovation, LLC to help
guide a transition to more sustainable lighting technologies, including light emitting diodes
(LEDs) and induction technologies.
Although the current SWD facility represents about 100,000 square feet, a 25,000 square foot
section of the manufacturing facility was identified as the first place to begin this transition with
the goal of achieving 20 footcandles in the 24/6 operation, and ideally as a one-for-one retrofit.
SWD is interested in collaborating with Illinois-based lighting manufacturers for economic
development reasons if possible.
Executive Summary
The SWD fastener company based in Addison, Ill will commence with a more sustainable
lighting conversion starting with manufacturing operations through a replacement of 400 watt
metal halide, high-bay lighting.
A vendor-neutral comparison of 4 different and more energy efficient lighting solutions
suggests a conversion to induction technology will be the least risky alternative with a projected
35% energy savings and a good return on investment compared to the metal halides they
replace. Induction technology is anticipated to deliver the shortest payback at 2.7 years and
with the lowest 20-year NPV cost compared to other competitive LED lighting systems
evaluated for this project and with strong assurance of long-term performance.
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4. An investment in a solid state lighting (SSL) technology will position SWD as an early technology
adopter, but is more risky. Long-term reliability projections are extrapolations so working with
high-quality LED manufacturers that meet standards and show proof of field experience is
critical. From a lifecycle cost analysis, a solid state lighting system could deliver a somewhat
higher energy savings of about 48%, a longer 4 year payback compared to induction and shows
a 20-year NPV cost of $85,000 compared to $112,000 to operate the metal halide system.
It is important to understand that long-term SSL reliability is unclear with this immature
technology making strong 5-7 year full product warranties and manufacturer support essential
to your procurement.
A higher first cost of SSL could be viewed as part of SWDs continued investment in
environmental stewardship and begin to understand how intelligent lighting can be integrated
into your strategic marketing message and future energy-management systems.
Implications and Recommendations
Both LED and induction solutions can provide a significant energy savings in the range of 35%-
48%. Fixture efficiencies today of about 70-80 lumens per watt make both technologies
relatively equal in terms of energy savings. Efficiency improvements with induction have
reached maximum potential. Whereas, LEDs continue to advance rapidly and is expected to
surpass induction efficiencies, with 120-140 lumens per watt fixtures that should be market
ready in about 2 years.
The upfront cost for induction is much lower. Their capabilities are not as effective as LED but
still provides an excellent energy efficient device with a faster payback.
Because LEDs are emerging and induction is considered a more proven technology, the
following recommendations are offered for consideration.
1. Understand your tolerance for risk. The least risky, energy saving lighting conversion
today can be achieved with induction technology provided by Neptun. This technology
can be expected to provide a 35% energy savings with comparable footcandles to the
400 watt metal halide fixtures they replace and with a strong assurance of a
maintenance free, and long lasting service life.
2. LEDs could provide a viable solution with the Digital Lumens product projected to
deliver a 48% energy savings and relatively close to meeting 20 footcandles as a one-for
one-replacement. Thermal management with LED is crucial to performance so this
vendor must understand the maximum and minimum operating temperature
environment of SWD, especially if heat or humidity might be a concern.
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5. 3. It may not be feasible to achieve 20 footcandles as a one-for-one retrofit with some
LEDs or even induction technology within your existing manufacturing space. The
facility may require about 2-5 more fixtures to achieve that level of light output, and
with good uniformity.
4. If LEDs are of interest, work with vendors who support full product warranties (not
limited) and demonstrate confidence in product performance. Five-year warranties are
norm, seven-year is best). Further, LED purchase orders might include legal verbiage
that addresses things such inclusion of drivers and power supply, or protection on other
important issues such as color shift or droop that is reported to occur with LEDs.
5. The most ideal time to spec a new lighting system rather than shoehorn or retrofit into
an existing space is with a new build out. That might be a more ideal time to specify an
LED or intelligent lighting system so it is integrated into building design or energy
management system.
6. Advanced lighting control strategies have a tremendous capacity for saving energy and
money within commercial buildings. Occupancy sensing could be leveraged with either
induction or LED with pre-selected fixtures (storage, warehouse) but generally does not
appear to be an option in the production area.
7. The cost of LED luminaires continue to drop about 10-20% each year, making that
investment more palatable each year. If SWD begins to convert to LED today, make
certain that LED fixture modularity is addressed so that lamps can be easily upgraded as
greater efficiency hurdles become market ready.
8. Consider using a vendor-neutral purchaser of energy. SWD might consider bidding their
electricity supply requirements out to several different suppliers in a formal RFQ
process. Companies that do not ask for competing proposals typically pay higher prices
than companies that bid out requirements. Further, consider fixing the price for the
next available time frame due to the recent downturn in futures pricing (see appendix).
Integration of LEDs will be determined by SWD’s tolerance for risk, future interest in advanced
lighting control strategies and ability to fund a lighting conversion that is more costly upfront.
ComEd incentives of about $100-$150 will help make the investment of LEDs more palatable
but SSL is more than twice the cost of an induction lighting system.
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6. Competitive Technology Review (Induction versus LED)
Solid state lighting is a more expensive technology upfront but offers great promise for
reducing energy use and operating expense. However, it is important to remember that
aspects of the technology are still emerging and under development whereas the need for
businesses to cut energy and maintenance costs is more immediate.
Induction could provide a good transition for those seeking more efficient options than
traditional fluorescent technology. Induction does away with electrodes that are lifespan-
limiting in a fluorescent design. A specially designed heat conduction rod and coil creates an
electromagnetic field to energize gases, promoting the same phosphor reaction as fluorescent.
The elimination of electrodes gives induction a useful and more proven track record to deliver a
100,000 useful life.
Intelligent-based lighting using semiconductor chips can be equipped with adaptive lighting
and/or wireless controls to leverage daylight harvesting or occupancy sensing to achieve even
further energy savings. Today’s induction can include bi-level switching to lower energy usage
as well, but is not conductive to occupancy sensing as LED.
Table 1 below provides a general comparison of HID fluorescent technology, induction and
LEDs.
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7. In conclusion, LEDs are considered emerging technology with performance promises that are
extrapolations. Conversely, induction is a more mature technology with recent market
resurgence due to improved electronic ballasts.
LEDs are a System
LEDs are more complex than traditional lighting. It is an electromechanical system that includes
semi-conductor light sources, provisions for heat transfer, electrical control, optical
conditioning, mechanical support, and protection, as well as aesthetic design elements.
Because the LEDs themselves are expected to have long life, all of these other components,
adhesives, sealants, solder joints and other materials must be equally long‐lived. To the extent
they are not, they will limit useful life1.
While LEDs do not radiate forward heat, half or more of the input energy may be converted to
heat that must be conducted away from the diodes (or the back side of the chip). This requires
1
SSL Product Quality Lighting Initiative, May 2010; Next Generation Lighting Alliance and US Department of Energy
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8. a reliable, heat‐conducting assembly, in addition to a heat sink component or means for further
conduction.
For proper operation, the power supply and electronics must provide a well‐controlled DC drive
current and possibly other control features, and must not fail for the life of the product. Any
optical components must be able to withstand years of exposure to intense light and possibly
heat without yellowing, cracking, or other significant degradation. Reflecting materials need to
stay in place and maintain their optical efficiencies. Even if the design itself has addressed all of
these issues, questions of Was the epoxy properly mixed? Was an essential heat‐transmitting
paste omitted? Were the wire bonds properly made? Any of the failure mechanisms inherent in
electronic assemblies, and many others, may apply to an LED luminaire.
The following visualizes all the system components of an LED lighting system.
Thermal
Finish/paint Mechanical
LED
Fixture
Adheasives Optical
Electronics LED Chips
An important message is that these mechanisms must be accounted for by LED vendors when
discussing product life to ensure a long-lasting and reliable light source.
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9. RightLumen™ Lighting System Comparisons for SWD, Inc.
Lusio Digital Lumens Albeo Neptun
Induction
Delivered Lumens 23,950 18,000 20,310 (3 Modules*) 20,000
Wattage 239 210 238 262
Lumens/watt 103 85 85 80
Chip supplier Lumileds Rebel ES CreeXMC Nichia N/A
Driver supplier Advanced Driver mfg by Digital Universal/Advanced (1 for Ballast designed
Lumens** each module) & mfg by
Neptune**
Drive current 700 mA 900 mA 1 Amp N/A
Dimming/Occupancy Sensing Yes, separate 1-10V, Yes Yes, 0-10V;on/off Bi-level dimming
agnostic?
Active/passive heat Passive Passive Passive
management
Temperature range -31˚F – 122˚F -40˚ - 122˚F -30˚ - Max 131˚F
Kelvin 5,148 5,000 – 6,000 5,000 5,000
CRI 68.1 70 74 83
Rated Life* 70,000 hours 50,000@77˚F 60,000 hours 100,000
Power Factor .996 .90 .98 .98
THD 6.93% <20% <.10% <10%
Do you have factors for ambient Probably, will provide Yes, from LM-80 Below -36˚C (tested in
temperatures above and below Federal Center in Boulder
your test? If so, please provide
Can you provide technical Yes - Yes Yes, from Boulder Yes
support/troubleshooting
LM-79 test data Provided (attached) Yes, but not only Yes N/A
15,000 lumen fixture
LM-80 test data Provided w-TM-21 Yes, provided on Yes, copies provided N/A
projections of 54,000 hr 15,000 lumen fixture
life
What is your case temperature Maximum
per LM-80 (junction point) At ambient of 70˚ was 74˚ Yes, 55˚C or 133˚F Operating Temp?
132˚F
Does mfg own IP? Yes, on design Yes Yes Yes
How long have you been 8 years; Division of 3 years- 6 years 10 years
supplying LED fixtures LightWild (control
company)
What is the longest burn hours in 12,000 fixtures 2
actual field installation Since 2009 years, 2 years
How many installed in
US?/globally 6,000 12,000 fixtures 90,000 fixtures deployed >100,000
Share some problems you’ve None shared; no Yes, ½% failure rate, Published failure rate .62% 1.5% failure rate
have? Resolved? experience; chip only moisture damage, and under 1% ; driver failure (combined
1/10 of 1% resolved by but accessible from bottom fixture and
manufacturer of fixture ballast)
IES files Yes, provided Yes, provided Yes, provided Yes provided
Warranty (driver and power 7 years, limited and 5 year full (power 5 years, limited and includes 10 years, full;
supply) includes driver and supply/driver; not power supply/driver (does fixture and
power supply color shift) not cover labor) ballast
Interchangeability; modular Modular; with serial and Everything is modular Yes, easily add or remove N/A
version #’s to upgrade (fixture and power modules; more robust to
supply) accommodate upgrades
UL rated/listed Still going through UL Listed No, but CSA listed UL Rated 1598
process
IP Rating IP65; ProOptics Enclosed; IP-30 and IP-65 No, but damp locations No IP, but sealed
IP20 Pro Optics & under CSA fixtures
Essentials
Buy America Certification? Mfg. in Kansas City Mfg in China Mfg. in Boulder, CO Lake Bluff, IL
Lighting Facts™ Label Yes Yes Yes DNA
Shielding for glare Yes No Yes, diffuser sleeve
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10. Lusio Digital Lumens Albeo Neptun
Induction
Adaptive to different sizes and Yes: 2x2; 2x4, 1x4 20x16 inches Yes, add or remove (6,000 No
configurations lumens each)
Wireless control? No, not in today’s fixtures Yes, available Yes, available today (zigbee) No
today(Zigbee protocol)
RoHS Compliant Yes Yes No No, trace
mercury
AC or DC based LED DC based DC based DC based AC based
Cost per fixture $714 $737 ($80 install) $1,086 (includes shipping) $374 (includes
shipping)
Cost per lumen .02 .04 .05 .02
Average footcandles 19 fcs 21 fcs 19.8 – 24.3 fcs 14 fcs
Minimum footcandles 2 fcs 12 fcs 3 fcs 10 fcs
Projected Energy Savings (%) 40% 48% 40% 35%
NPV Costs (20 years) $86,499 $85,628 $99,042 $73,768
Projected Payback (yrs) 4.22 3.88 9.21 2.75
Financial Assumptions and Projections
The following assumptions support the financial analysis. A sharpened pencil will create a more exact
analysis of SWD rates and understanding whether fixtures will be purchased with cash or borrowed
funds. Financial projections shown below make relatively confident comparisons of each lighting
system and will be fine tuned going forward.
Hours of 6,912
operation
Labor Rates $20/hr
Hours to provide 15 minutes*
maintenance per
lamp
k/Wh rates .083* time of use rate, separate consumption that is lights;
calculate rates with old vs new, that would get you something
lower in terms of electricity costs. On-peak and off-peak buckets
(summer/winter?). Need to isolate energy use of lighting versus
on-peak/off peak rates.
Demand charge Captured in varying energy charge/none;
Ballast or driver 5 years
replacement
Cost of capital 10%*
Inflation rate 3%
Discount Rate 5%
ComEd Incentive $100 for LED; $50 for induction
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11. Lighting System Net Present Value (20 year, costs) Payback (yrs) Internal Rate of Return (IRR)
Lusio $86,499.91 4.22 28%
Digital Lumens $85,628.65 3.88 30%
Albeo $99,042.99 9.21 12%
Neptun $73,768.47 2.75 69%
METAL HALIDE $112,012.81 N/A N/A
In conclusion, a conversion to either LEDs or an induction lighting system will make good business sense
compared to the existing metal halide system in place. A 20-year net present value (cost) of operating
the existing metal halide system is projected at $112,012 and exceeds that of any of new lighting
systems proposed above.
Induction appears to be overall, the best lighting system investment for this application but deserves
careful consideration of future energy management and sustainability plans for SWD in the future.
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