According to the Department of Energy, by 2027, widespread use of LEDs could save about 348 TWh of electricity: This is the equivalent annual electrical output of 44 large electric power plants and a total savings of more than $30 billion at today’s electricity prices. But the transition to LED is costly for not just the manufacturers and distributors; it can also get pretty costly for the consumer as well.
The demand for LED continues to grow as the government requires a push away from fluorescent lights. So, who pays the price? In many states, there is a rebate process. Can distributors help offset the costs with these rebates? We tracked down a couple of distributors and asked this very question.
Wes Smith, president of Mayer Electric, says, “The more progressive distributors are equipped to know the utility rebates that are available in their markets. In most instances, rebates are already being used to partially or fully offset product and installation costs before the price increases. A higher price eats into it the offset and I do not see rebates increasing in relation to product cost increases.” Smith also says Mayer is constantly searching for rebates and using them as a selling tool.
But who pays in the end? Brian Rooney, of Crescent Electric Supply Company, says the contractor or the end user. “Unfortunately, there’s not much left to offset costs with on the rebate side, but we do feel like we can assist in more ways than one,” Rooney says. “The rebate programs, coupled with the technical expertise of our lighting and energy specialist, is really what makes the difference for us. There’s an old adage that is ‘if you sell on price, you’ll lose on price.’ So it’s our goal to take it a step further and add more than just a number; add expertise and a true partnership from a distributor.”
Like Mayer, Crescent also uses rebates as a tool to sell a large upfront project cost to show a significant payback and rate of investment. “As LED prices have come down over time, these rebates have become more and more significant,” Rooney says. “Additionally, with better technology and energy savings options it’s important to show the cost savings with a lower utility bill.”
Rooney says the recent price increases are the largest they’ve ever seen and they don’t seem to be letting up anytime soon. He says there are arguments on both sides of whether this is healthy for distributors. Nevertheless, distributors are doing everything they can to soften the blow for their customer base.
So how do companies stay on top of the rebates? Smith says there are many tools our energy services people use to stay on top of rebates. Some tools are from the utility providers themselves and many lighting manufacturers have the tools or provide links to the tools. Smith emphasizes that it is not hard to stay on top of this, hopefully saving money for all involved.
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