Performing a life-cycle cost analysis allows you to see the total cost of a light fixture over its lifetime, including its initial cost and its expected operating and replacement costs.  To compare the cost-effectiveness of several different types of technology prior to a lighting retrofit, you can perform an analysis of all of them based on the lamp life of the longest-lasting option. This allows for an “apples to apples” comparison. To understand how this works, it helps to start with a few definitions:

Lamp Life refers to the number of hours a lamp can be expected to operate. For example, a 150-watt LED high bay may be rated for 60,000 hours of life, while 400-watt metal halide high bays are only rated for about 20,000 hours of life.

Kilowatt Hour – This is a unit for measuring a lamp’s energy use over a period of time, as opposed to watt or kilowatt, which refers to the rate at which the lamp uses energy. For example, if you leave a 60-watt incandescent bulb on for one hour, it will use 60 watt-hours, or .06 kilowatt-hours (60 divided by 1000).

Replacement cost – You arrive at this figure by calculating how many times you would have to replace a particular type of fixture over the life of the longest-lasting light and then multiply it by the purchase price of that fixture. In the example below, the 400-watt metal halide high bay has a life of 20,000 hours and costs about $150 a fixture.  The longest-lasting option in this example would be the 230-watt LED high bay, which has a life of 75,000 hours.  So, to get the same useful life from the metal halide as from the LED, you would have to replace it 3.75 times (75,000 hours divided by 20,000 hours). At a cost of $150 each, that comes to $562.50 in replacement costs.

Energy Cost – for the purposes of this example, we are using the average price of electricity in U.S., which is $.07 per kWh according to the U.S. Energy Information Administration.  However, actual prices can range from 5 cents in some areas of the Midwest to 13-15 cents in places like New York.

Life Cycle Cost Analysis, comparing metal halide, LED and T5 Fluorescent High Bays


400-watt Metal Halide High Bay 230-watt LED High Bay (CREE’s CXB series)

4-lamp T5 HO High Bay (Howard Lighting HFA2 Series)


458 Watts/fixture (lamp + ballast)

230 Watts/fixture

234 Watts/fixture

Cost to buy the fixture 




Lamp life




Replacement cost

Bulbs: 3.75 x $25 = $93.75

1 fixture - $389.90

Bulbs: 2.5 times  * $3.50 * 4 each = $35.00

Energy consumption over 75,000 hours

458 Watts x 75,000 hours = 34,350,000 watt-hours = 34,350 kWh

230 Watts x 75,000 hours = 17,250,000 watt hours =17,250 kWh

234 watts x 75,000 hours =

17,550,000 watt hours = 17,550 kWh

Energy Cost per kWh  




Cost of Electricity needed for 75,000 hours

34,350 kWh X 0.07/kWh = $2404.50

17,250 kWh X 0.07/kWh = $1207.50

17,550 kWh x .07/kWh = $1228.50

Total Life Cycle Costs to own and operate for 75,000 hours

$2404.50 for energy +  $93.75 in replacement costs = $2498.25

$1207.50  for energy  + $389.50 in replacement costs = $1597.00

$1228.50 for energy + $35.00 in replacement costs = $1263.50

This analysis clearly demonstrates that although the 400-watt metal halide high bays are much less expensive than either the 230-watt LED or the T5 fluorescents, their life-cycle cost is much higher because they have to be replaced more frequently and they consume more energy.

Maintenance Costs Lower for LEDs

In this particular analysis, the 4-lamp T5 high bay actually came out the winner. However, under certain circumstances, LED might be the better option – if, for example, the cost of electricity were higher or the actual burn hours were longer (as in a manufacturing plant running three shifts, 365 days a year). The long-term results might also be different in a dirty environment, like a metal fabrication plant where debris carried in the air settles on the light fixtures, or in a facility where lights are occasionally damaged by the movement of lifts near the ceiling. Fluorescent bulbs need more frequent cleaning and repair than LEDs, which are nearly maintenance-free.


Shop Now for LED Retrofit Kits Based On Wattage


Disposal Costs Higher for Fluorescents and HID

Another factor that should be taken into account is the cost of disposal. All fluorescent and most HID lamps contain mercury, while LEDs do not. Even low-mercury lamps need to be either recycled or disposed of properly. Disposal costs typically include packaging the lamps in reusable cardboard boxes designed to avoid lamp breakage in transit, as well as all the documentation needed to prove certified disposal. The same holds true for ballasts. Although most magnetic ballasts, which contain PCBs, have been eliminated, they are still common in older buildings, and must be professionally disposed of, with a full paper trail to prove it.

The Costs of Poor Quality Industrial Lighting

Finally, there are the intangible costs – those that are hard to put a price tag on but could certainly impact your profits. When older technology like a 250- or 400-watt metal halide high bay starts to deteriorate it casts a yellowish, uneven light and might also start flickering and buzzing. This could adversely affect workers’ visual perception, task performance, safety and security.

Bottom line:  when shopping for replacement lights for an industrial lighting retrofit, you have to look beyond the initial price to the costs over the whole life of the fixture to get a fair comparison.

Shop Now for LED Retrofit Kits Based On Wattage