Business Case Evaluation - Existing Parking Deck Facility Lighting
2
2.
Phased LED lighting change-out:
The City replaces parking deck lighting with LED
fixtures starting with the highest energy consuming parking deck and completing two
decks per year.
3.
Phased LED lighting change-out triggered by LED cost:
The City replaces parking
deck lighting with LED fixtures starting with the highest energy consuming parking deck
and completing two decks per year, however, under this option the change out is
delayed until such time as LED fixture costs are reduced, based on future LED cost
projections (DOE, 2011a).
4.
One-time, full-scale LED lighting change-out:
The City replaces all parking deck
lighting with LED light fixtures at one time.
Financial Analysis
A financial analysis was completed to compare the life cycle net present value of the total cost
for each parking deck lighting option, focusing on the capital and operating costs. The typical
industry standard definition for the life cycle of LED lights is defined as a 70 percent reduction in
light output which equates to approximately 50,000 hours of operation as a minimum life cycle.
Some LED vendors quote life cycles up to 100,000 hours of operation but 50,000 hours
continues to be the standard currently used for the evaluation of LED lights. If operated for 12
hours per day, 50,000 hours equates to a life of approximately 12 years. In this analysis, a 24-
year period was assumed (approximately 2 life cycles for LED lights) to account for the options
which involve phasing of the LED fixture installation.
Table 1 presents the total future costs for each option and Table 2 presents the results of the
net present value analysis. Both Tables 1 and 2 present data for two life cycle scenarios that
bound the current perceptions of the minimum and maximum service life for the current LED
technology. Figures 1 and 2 present a comparison of net cash flows from 2012 through 2035,
for the 50,000 and 100,000 hour life cycle scenarios, respectively. These two figures present
cash flows with capital costs converted to annual debt service payments, which includes the
cost of capital. Attachment A contains the parking deck facility light fixture inventory and LED
equivalency determination. Attachment B contains the primary financial assumptions used in the
net present value analysis. Future year cash flow charts for each individual option and life cycle
scenario can be found in Attachment C.
TABLE 1
Summary of Total Future Costs (Calendar Year (CY) 2012 – CY2035)
Option
Capital
Cost
Power
Costs
Maintenance
Costs
Total
Costs
Life Cycle
= 50,000
hours
1
$0.2M
$8.3M
$1.8M
$10.2M
2
$5.1M
$3.3M
$0.2M
$8.6M
3
$5.1M
$3.8M
$0.3M
$9.2M
4
$5.9M
$3.1M
$0.1M
$9.1M
Life Cycle
= 100,000
hours
1
$0.1M
$8.3M
$1.8M
$10.2M
2
$3.0M
$3.3M
$0.2M
$6.5M
3
$3.3M
$3.8M
$0.3M
$7.4M
4
$3.5M
$3.1M
$0.1M
$6.7M
Note: There was no consideration included in analysis for the decay in energy efficiency towards the end of a fixture life cycle.
Note: Costs in this table have not been discounted.