Industrial facilities face escalating demands for efficient LED lighting solutions due to their extensive size, high fixture counts, and prolonged operating hours. These challenges are magnified by the imperative for cost savings, workplace safety needs, and environmental responsibility.
To heighten this demand even further, spaces that operate in California — which endures one of the highest costs for electricity in the US — are uniquely positioned to see even greater benefits from energy-efficient LED lighting upgrades due to several reasons: huge reductions on energy spend can be gathered with the steep costs for electricity (often up to 80% or more!); top-tier energy rebate and incentive programs that improve profitability, and zero-interest, zero-capital requirement funding options through the state’s top utility providers.
For managers that range in responsibility from safety, sustainability, and operational efficiency, facility — this blog will help you gather some of the initial ways that an LED retrofit may be an off-radar opportunity to capture massive, profitable value that is currently hiding in your lighting system.
Why do California industrial spaces see such a large impact from LED lighting retrofits?
Industrial spaces typically require the heaviest system demands
By nature, heavy industrial, logistical, and warehousing spaces also tend to have the highest need for an efficient, well-designed lighting system:
- Large square footages and high-fixture counts draw more energy.
- Long operating hours lead to high usage, amplifying any system inefficiencies.
- Maintenance challenges persist, as frequent burnouts occur due to old technology, often resulting in production stoppages to address.
- OSHA & Industry compliance is a must for worker safety, and difficult to achieve with outdated optics, controls & technology.
California has one of the most expensive (and rising) costs for power in the US
At 18.55 cents per killowatthour in 2023, California endures the 3rd highest cost of power across the US, trailing only Hawaii and Alaska.
This represents an 11.84% YoY increase, with a price of 16.64 cents in 2022, according to the US EPA.
With outsized spending on electricity for California sites, businesses that elect to continue powering an energy-hungry lighting system face an incredibly costly expense, one that often flies under the radar, that creates headwinds for hitting your profitability goals.
California businesses have access to the top energy rebate programs in the country
California businesses seeking efficiency upgrades can potentially leverage some of the top energy rebate and funding programs in the country. Incentive rebate programs, like the Market Access Program (MAP), allow businesses to access funding for up to 100% of the the total project cost.
Don’t go it alone! Tap expert support from incentive specialists
Clients that work with PEC to implement LED lighting and energy efficiency upgrades receive no-charge, full-scale management of the incentive collection process. Solution designers work hand-in-hand with our Energy Program Specialists to understand all available incentives, how the upgrade can be designed to maximize incentive impact (i.g. certain rebates may be available for fixtures, lighting controls, etc.), and stay cognizant of any program updates or timelines.
Learn more about the essential role of PEC incentive experts »
California utilities offer zero-interest, $0 capital required funding options through On-Bill Financing (OBF)
On-Bill Financing (also known as “OBF”) can present a fantastic option for business that want to make headway on carbon-reduction efforts, improve facility safety, but face budgetary and capital constraints.
OBF programs, which are offered through California’s largest utility providers, allow commercial customers to use the monthly savings gathered from their efficiency upgrade to pay off the project on their monthly power bill — offering a zero-interest, cashflow-positive funding option.
Some of the largest California power providers offering OBF options includes SCE, PGE, and SDGE. Learn more about each at the links below:
- Southern California Edison On-Bill Financing Options
- San Diego Gas & Electric On-Bill Financing Options
- PG&E Energy Efficiency Financing Options
Want to learn more about OBF? Reach out to connect with an expert HERE on how it could apply to your project
LED Lighting Case Studies: California Businesses
As LED lighting makes for such a compelling investment in California, our team has done extensive work throughout the state. See how some of our blue-chip clients have elevated their businesses with modern lighting design.
Weyerhaeuser: Lumber Manufacturing
Across 9 LED upgrades for Weyerhaeuser lumber plants, including sites in Fontana and Santa Clarita, Weyerhaeuser gathered:
- 9,452,844 kWh reduced each year.
- $432,067 saved on annual energy and maintenance spending.
- $655,686 collect in energy incentives.
- cleaner, brighter, and safer working environment.
See the Weyerhaeuser Success Story
Sysco: Warehousing and Cold Storage
7 LED upgrades across California, Ohio, Oregon and Texas:
- 1,351,876 kWh saved annually (59% annual energy reduction).
- $276,678 collected in energy incentives.
- 2.09 year average project payback period.
- Compliant and durable lighting for cold storage environments.
Reliance Steel: Mills and Service Centers
36 projects across 17 states:
- 10,323,027 kWh saved each year
- $723,007 incentives collected
- $1,373,647 annual savings on energy and maintenance spend
See the Reliance Steel Success Story
Lithia Motors: Parking Lots and Showrooms
274 locations, including over 70 throughout California:
- 22,095,847 kWh saved each year
- 68% decrease in annual energy spending
- $1,961,391 in incentives collected
See the Lithia Motors Success Story
IKEA: Warehouse and Big Box Retail
IKEA Distribution Center — Tejon, CA
74 projects across 19 states:
- 56% reduction in annual energy consumption
- Over $4M saved yearly on lighting spend
- Approximately 32,918,70 kWh saved each year
- $755,676 collected in incentives
How to determine impact and ROI of an LED retrofit:
When working with PEC, we will work with you through a 3-step “Pre-Proposal” process before you commit to a project:
- Discover: Receive a complimentary audit of your existing lighting system to determine current energy consumption and light levels. PEC Sales Engineers will gather critical photometric data to pinpoint energy waste.
- Design: Lighting designers use audit data to recreate your facility and system in a digital environment (known as photometric design). The new system designed leverage the best fitting fixtures, optics, and controls to optimize light levels using least amount of energy possible.
- Develop: PEC Sales Engineers present different design options, helping you correlate price and performance to make the best decision for your business.
If and when you’ve decided on a system that best fits your needs, we apply our fourth step in our process: DEPLOY. Our stellar Project Management and implementation team will oversee your project from A-Z, ensuring your project goes off without a hitch, while navigating around the ongoing the operations of your business to minimize disruption.
Next steps: talk with a PEC lighting expert
Ready to take action and see how we can help you conquer your 2024 efficiency goals?
Let’s setup a quick introductory call! You will learn more about our process, briefly chat through your current goals and timelines, and see if it makes sense to setup a more in-depth energy assessment meeting.
