Market Snapshot: LED Christmas lights are cost and energy saving compared to incandescent

Release date: 2015-12-22

Light-emitting diodes (LEDs) transform most of the energy that they consume into visible light rather than heat. Thanks to this efficient use of energy, LEDs reduce electricity consumption by 85 per cent compared to incandescent lights and 40 per cent compared to fluorescent lamps. In addition, today’s LEDs can last for as long as five years with continuous use, or up to 50 times longer than incandescent bulbs, and three to seven times longer than fluorescent lamps.

For the same expenditure on electricity, Canadians can decorate their houses for the holidays with many more LEDs than incandescent lights, as shown in the graph below. For example, ten dollars of electricity in Quebec will power 161 LED strings compared to 19 incandescent onesFootnote 1. In New Brunswick, ten dollars will power 100 LED strings compared to 11 incandescent ones.

Figure Source and Description

Source: Hydro-Québec, NEB calculations

Description: This bubble chart compares the number of strings of decorative lights that can be powered during the holiday season for a total electricity cost of $10 in each province. The number of incandescent strings that can be powered for $10 varies between eight in Nova Scotia and 19 in Quebec. The same $10 powers between 72 LED strings in Nova Scotia and 161 LED strings in Quebec.

In Canada, 40 per cent of households reported using LED holiday lights in 2013, up from 29 per cent in 2007. Efficiency initiatives are also being introduced to encourage further switching to LED technology. For example, residents could trade their old incandescent holiday lights for strings of LED lights during events organized in New Brunswick and Nova Scotia.

According to a report released by Goldman SachsFootnote 2 general lighting accounts for 15 to 20 per cent of global electricity consumption and three billion lamps are sold per year worldwide. LEDs’ share of this market has increased from one per cent in 2010 to 28 per cent in 2015. Sharp cost reductions and performance improvements, relatively short replacement cycles for incumbent technologies, and aggressive policy support (including bans on incandescent technology in major markets such as the US, EU, and China) have helped LEDs rapidly obtain market share. Based on current trends, LEDs will likely hold more than two thirds of market share by 2020, and nine out of 10 light bulbs sold worldwide will be LEDs by 2025.

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