Case History: High-Benefit Lighting Can Produce Quick Payback

Case History: High-Benefit Lighting Can Produce Quick Payback 2017-01-07T19:07:26+00:00
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Case Histories: Retail Lighting

High-Benefit Lighting Can Produce Quick Payback

By John Phillip Bachner

For many retail owners and managers, electric illumination is an issue most often dealt with by those responsible for operations and maintenance. Occasionally, particularly after an incident of some type, risk management may also become involved. After all, lighting is an expense, and, as with all expenses, the goal is to get the job done for the least possible cost. Thus it is that shopping centers throughout the nation have spent millions of dollars on upgrades to effect energy conservation. Particularly when local electric utilities help foot the bill, these conservation efforts can pay handsome dividends.

A number of shopping center owners and managers have discovered to their delight, sometimes by accident, that lighting can be much more of a profit-builder than an expense. It can also be an extremely effective tool for reducing other costs, such as those for security patrols and parking. In fact, the money saved and profit generated by High-Benefit Lighting® can be far, far in excess of the expenses associated with the ownership, operation, and maintenance of lighting. The key is to install high-benefit lighting.

High-benefit lighting is a term coined by the National Lighting Bureau to connote electric illumination that is designed to deliver benefits that can accrue when lighting is specifically designed to achieve them. Because most of those who manage shopping centers or who direct lighting system operation and maintenance are sometimes unaware of the panoply of benefits available, they often settle for less than high-benefit lighting. The consequence is not necessarily bad lighting. Often, it is lighting that fails to pay for itself rapidly, because it fails to achieve high benefit at the least possible cost of operation and maintenance.

Resource for Education

Established in 1976, the National Lighting Bureau serves as an educational resource for those who must make decisions about lighting without a technical background. The organization is sponsored by companies that manufacture lighting products and systems, several national trade associations and the federal government (the latter through the US General Services Administration).

For a number of years, the NLB has been gathering case histories through its National Lighting Awards program. These tend to illustrate the benefits that can be attained to alert lighting system owners and users to what they can achieve, providing they seek it.

Concerned about Security

Consider the case of Fairmount Fair Mall, a shopping center located in Camillus, NY. Inadequate parking lot lighting there was creating serious problems for the owners: shoppers were concerned about the security of their cars; both pedestrians and drivers said they were being made uncomfortable by glare from the lighting; and neighboring landowners complained about “light trespassing,” i.e., light from the parking lot luminaries (fixtures) “trespassing” onto neighboring properties.

Convinced that improvements were needed, the mall’s manager conducted a survey of shoppers to ascertain what they liked and disliked about the outdoor lighting at Fairmount Fair and other centers they patronized. After analyzing survey responses, management decided to install new outdoor lighting that relied on metal halide lamps, combining good color-rendering properties with high-efficiency and relatively long life. Energy consumption was not a major issue. In fact, an analysis of the savings generated by energy conservation indicated that payback would have taken more than 100 years. Nonetheless, payback was achieved in relatively few months, because management directed installation of high-benefit lighting.

One of the principal concerns at Fairmount Fair Mall was reducing vandalism, especially during the busy Christmas season when the parking lot was filled with cars. During the first Christmas with new lighting installed, vandalism was almost nonexistent. Because of this effective security, management was able to reduce security patrols, saving $5000 per year. Management also avoided negative publicity, negative word-of-mouth “advertising,” and insurance claims. The new lighting also permitted faster snow removal in the parking lot, saving another $7,500 each year.

Upside Significant

While $12,500 in avoided expense is nothing to sneeze at, the biggest benefits came in the form of income enhancement and capital appreciation.

The new lighting at Fairmount Fair Mall created much more “notice;” that is, drivers passing by noticed the mall more because the illumination made it much more visible at night.

And what did passers-by see? They saw a large shopping center that was well illuminated, meaning that it was much safer for people to shop there at night, with less likelihood of “incidents” in the parking lot. Notice translated into “attraction”, meaning that more people were attracted to the mall at night, especially those who did most of their shopping at night because they worked during the day, as well as older people for whom parking lot safety and security are particular concerns. Consequently, traffic went up markedly and retailers estimated that an additional $2.5 million in annual sales resulted. Because of increased sales, the owners’ rent increased by an estimated $90,000 per year. In addition, the mall’s vacancy rate declined and its overall value was increased by an amount probably in millions.

A review of a number of National Lighting Bureau case histories indicates that bottom-line benefits derived from better lighting in shopping centers are obtained in other types of buildings or other operating areas as well. As a general rule of thumb, says National Lighting Bureau Director Kyle Pitsor, “Those responsible for lighting need to ask, ‘Why did we install lighting here in the first place?’ In other words, what would happen if you didn’t have lighting? To the extent that some lighting would help overcome the problems of no lighting, recognize that lighting specifically designed for an area will produce results that are much better than simply ‘some lighting.'”

Unless you know what lighting can do for you, however, those installing the lighting may not demonstrate much interest in helping you really enhance your bottom line. If you assume that electric illumination is an expense, chances are you will be offered a lighting system that lowers that expense. However, if you recognize that lighting can help you avoid a wide array of expenses while also building income and capital appreciation, than you are far more likely to get the kind of system you need to achieve those goals.

Somewhat ironically, the cost of having lighting systems that can do such a fantastic job for shopping centers’ owners and managers is not appreciably more than the cost of systems that merely cut energy expenses. This occurs because of the “leveraging effect” of lighting. Ask yourself how much money will be lost if all year long you had no lights. Then ask yourself how much you spend on lighting each year.

Chances are the sales loss would be estimated in the millions of dollars while the amount you spend would in many cases not exceed $50,000 or $60,000. If better lighting could improve income by five percent, how much would you be wiling to spend to obtain that increase? Probably five times what you’d actually have to.

A number of sources are available to help you design high-benefit systems. These include consultants who specialize in retail and shopping center lighting as well as manufacturer’s application engineers who may have expertise in the retail and the shopping center industry as well. A number of utilities have lighting specialists as well as a variety of programs that will help pay at least some of the cost of the new lighting when energy savings result. (A high percentage of Bureau case histories demonstrate that high-benefit lighting is accompanied by significant energy savings, too.)

Reprinted with permission from CARLSONREPORT, the newsletter for shopping center management. Copyright 1998 CARLSONREPORT, Inc.