What is the Return on Investment for installing LED lighting?

March 11,2026

While we do not anticipate that this question will still be relevant in three or four years’ time, it is one that continues to arise frequently at present: What is the Return on Investment for installing LED lighting? However, in order to provide a meaningful answer, it is essential to examine the specific application of the lighting, rather than focusing solely on the technology being replaced.

Broadly speaking, when comparing LED with LED, there are two principal approaches to driving the light sources: one prioritises effectiveness (maximum light output), the other prioritises efficiency (maximum lumens per watt). When LEDs are operated for effectiveness, they are driven hard to extract as much light as possible from the smallest possible surface area. This generally results in a reduction in the size and weight of the heat sink and a lower number of LEDs. In this scenario, a 5W LED may indeed be operated at 5W. While this yields the highest light output per square centimetre, the LEDs are not running particularly efficiently in terms of energy consumption. This is due to the fact that LED efficiency diminishes as they approach their maximum output. Consequently, a 5W LED running at just 1W may well be twice as efficient in lumens per watt as the same LED driven at full power. Designing for efficiency therefore requires more LEDs, a larger surface area, greater weight and, inevitably, higher cost.

Another important comparison is between metal halide and LED. A well-designed metal halide luminaire, such as the Philips MVP, is a highly efficient unit in terms of lumens per watt. When new, a traditional 2kW metal halide fitting would require at least 1600–1700W of LED to achieve comparable light output. For an LED installation of this scale, the cost could easily be double that of metal halide units. Multiply this across 24, 48 or more fittings depending on required lux levels, and the financial implications become considerable.

Thus, when addressing the question of ROI, we must always consider the application. In a warehouse with dozens of high-bay fittings operating around the clock, the considerations are entirely different from those for a sports pitch used only a few hours per week. In the warehouse, there is minimal airflow, the lights are on for extended periods and are often difficult to access. Running 100 x 150W lamps 24 hours a day, 365 days a year equates to 360kW per day, or 131 million watts annually. By contrast, a football club using its floodlights for training a few times each week might consume around 10 million watts per year. For such a club, the capital cost of the fittings and poles is of far greater concern. If a club were to invest an additional €20,000 in a more ‘energy efficient’ system – partly due to increased luminaire weight and the associated reinforcement of poles – it would take many years to recoup that outlay through energy savings alone.

This brings us back to the question of ROI for sports lighting. As the examples above illustrate, sports lighting is generally designed around light output rather than energy efficiency, given the relatively short operating hours. ROI must therefore be calculated over the full lifecycle of the installation. In this context, operational efficiency – or ‘electricity consumption’ – becomes less significant, while maintenance and the associated ‘hassle factor’ take precedence. Although metal halide fittings perform excellently and are cost-effective both to purchase and operate, they do not maintain peak performance for long – typically around 400 hours. After this period, light output falls to approximately 75% of the original level. The lamps then shift in colour temperature, eventually failing altogether. While the lamps themselves are not prohibitively expensive, sourcing replacements for older fittings is becoming increasingly difficult, with some models no longer in production. Moreover, the lamp is the least of the costs; installation is where the expense lies. This involves hiring an electrician and arranging access equipment such as a cherry picker or boom lift. For many rural towns, a 30m boom lift may have to travel a considerable distance, significantly adding to the cost. As a result, even when batched together, lamp replacements can exceed €5,000 annually. Over a decade, this transforms what initially appeared to be a very economical solution into a far more expensive one. By contrast, LED fittings typically come with a minimum five-year warranty. With a robust contract, most reputable manufacturers and installers offer warranties covering both parts and labour, including the cost of access equipment. This means that even a relatively modest club could expect to save an average of €25,000 over the first five years.

It is therefore unwise to take a simple upfront cost comparison between metal halide and LED at face value. Calculations must be carried out carefully to ensure that the financial advantage holds over a ten-year period. Another risk factor is that many metal halide manufacturers have ceased production of certain fittings, meaning that spare parts such as ballasts and lamps may become unavailable within the decade. This could necessitate the purchase and storage of spares, further adding to costs. Combined with the inconvenience of delayed start-up times for metal halide systems, LED becomes an increasingly attractive option. 

By 2026, LED lighting technology will have fully replaced metal halide lamps. Upgrade your lighting equipment now to save significant costs.

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