Four considerations when facing high lighting costs

Lighting can be surprisingly expensive during a project, but there are ways to reduce the cost and be more knowledgeable about the source of the expense.

By Carmen DiCicco and Elizabeth Williams June 18, 2020

Your project is designed and out for bids. Pricing comes back and you discover the lighting package is considerably more expensive than you had anticipated. You’re left contemplating, “how did this happen? Where did this pricing come from?”

Here are several possible culprits for the unexpected spike in lighting costs for your project, along with some suggestions for how to avoid, when possible, paying for more than you’re getting.

1. High quality function and aesthetics will cost more

In terms of aesthetics, a cheaper light fixture may look, well, cheap. The materials used may be of lesser quality. The composition, machining, and engineering of the fixture may not have been thoroughly developed or tested, resulting in a clunky, unfinished appearance.

Given the nature of LEDs, a lot of research and development (funding) goes into optics and lensing. A cheaper light fixture may have poor light distribution. High quality optics are designed to focus light only to where it is needed and reduce glare and spill, which makes them highly efficient. A cheaper fixture may simply create a blob of uncontrolled light with unwanted glare. If you spend the extra money for a light fixture with a better optical distribution you may reduce the total number of fixtures you need, your space may look better, and your occupants can avoid the headaches from glare-y lighting and you can avoid them from fielding complaints.

Quality decorative lighting tends to cost more, but not just because it is more aesthetically pleasing or uses fancier materials (although that certainly contributes to cost). Decorative lighting is typically purchased in lower quantities per project than typical architectural lighting. For example, you may purchase eight downlights to line the perimeter of a conference room, but only one decorative pendant to suspend above the table. A decorative lighting manufacturer must take this into account, and in order to turn a profit, may increase the cost of the lighting to make up for a lower purchased quantity.

Custom or modified light fixtures sometimes require special tooling and testing which costs the manufacturer money to implement. Additionally, lighting manufacturers frequently outsource various components of their products, such as drivers, LED boards, and the materials to make them, such as aluminum and steel. If the cost of a component is higher than usual, either due to a special request or a fluctuation in price, the cost of the lighting product will be affected. We recommend requesting a current, itemized bill of materials (BOM) from your supplier to identify these costs.

2. LED technology is more complex than traditional sources

LED technology has resulted in complicated testing requirements becoming the standard for manufacturers of reputable lighting products. For most specifiers, there is an expectation that ANSI/IES standards such as LM-79 are carried out for every iteration of a lighting product offered by a manufacturer. For example, if you manufacture a recessed downlight and want to offer three distributions with four lumen outputs to choose from, you’re looking at a minimum of twelve iterations of testing and reporting. If you update your product with more efficient LEDs, better color rendition, etc., all those tests must be repeated.

LED lighting contains multiple components which have advanced technologically compared to legacy sources. Drivers, compared to legacy transformers, can be compatible with multiple lighting control and dimming protocols. LED luminaire housing must be designed to facilitate heat sinking, which is essentially a new issue for some applications as many legacy sources are not negatively affected by heat. And since LEDs are directional (not omnidirectional like many legacy sources) and are ‘ugly’ when exposed, some type of concealment: lensing or engineered optics are essentially mandatory. All of these components add cost to a well-designed LED light fixture.

3. Lighting controls are a major component of costs

In Michigan, specification of lighting control devices and systems must now adhere to the very strict Energy Code ASHRAE 90.1 2013. Most spaces can no longer have just a toggle switch on the wall. Occupancy/vacancy sensors and daylight harvesting sensors are needed almost everywhere. Networked lighting control systems, which allow the owner to have complete observation and control over all the lighting on their property with a touch screen interface, are becoming increasingly more utilized over standalone switches.

LED technology has opened an entire world of possibilities in terms of how we can control and interact with lighting. LED fixtures can produce color changing or tunable white light, which involves more complicated programming and scene setting. IOT (Internet of Things) connected lighting allows for a system of LED fixtures to “talk” to each other and share data on everything from foot traffic to end of life sensing. These tools are attractive and valuable, but not surprisingly come with a hefty price tag.

4. Owners for most commercial projects do not buy their lighting directly from the manufacturer

The bid process allows for lighting agents and representatives for various manufacturers to review the design documents and submit competitive alternates. The actual ordering of the light fixtures is typically done by a contractor, who will purchase the lighting through a distributor. The bidding and purchasing process involves multiple parties, and each party is paid for their services. The manufactured cost of a light fixture, called “distributor net” cost, can be marked up multiple times before it reaches the owner at “retail cost”.

These and other factors can affect the price of lighting on a project

Understanding the items above can help you estimate the cost of your lighting package and know what questions to ask in order to get more accurate estimates up front. This can help companies budget and avoid sticker shock.

This article originally appeared on Peter Basso Associates’ websitePeter Basso Associates is a CFE Media content partner. 

Author Bio: Carmen DiCicco and Elizabeth Williams, LC, Peter Basso Associates