A regular incandescent bulb costs $1 and uses $7 of electricity a year (if used three hours a day) and just lasts 1,000 to 2,000 hours. A Cree LED light bulb may cost $5 to $15, but it uses 10% of the electricity, costing $1 a year and lasts 25,000 to 50,000 hours (a period that is 25 times or more). While a traditional incandescent bulb will burn out in less than two years LED bulbs will keep working for a period of 10 to 20 years. This is at a cost of $5 to $10 for the equivalent of a 40-watt incandescent bulb, or $9 to $14 for a 60-watt replacement. Currently the Cree LED bulb has been aggressively priced so they are cheaper than comparable LED offerings from rivals.
In October 2013, two of the Cree LED bulbs qualified for Energy Star rating by the United States Environmental Protection Agency, this qualifies them for an (up to) $5 at-the-register rebate from many utility companies, bringing the final cost down to between $5 and $10 (originally LEDs hovered around the $40) . The bulbs are currently available nationally through Home Depot (this is an exclusive arrangement). The company stated it was challenging established lighting manufacturers with aggressive pricing because it wanted to speed up the adoption of LED lighting and that it would work toward producing even less expensive LED household bulbs in the future.
Why Are LED Light Bulbs So Important
If every U.S. household replaced just one regular incandescent light bulb with a LED light bulb, it would prevent 90 billion pounds of greenhouse gas emissions from power plants, the equivalent of taking 7.5 million cars off the road. And the U.S. Environmental Protection Agency says that by replacing regular light bulbs with LED light bulbs at the same minimal rate, Americans would save enough energy to light more than 2.5 million homes for a year.
Cree, Inc. has become a multinational company headquartered in the US and now boasts $1.3 billion in sales and $70 million in earnings. Its market cap of $7 billion has doubled in less than a year; investors foresee broad adoption of LED light bulbs once federal lighting standards force the phase-out of 40 and 60 watt incandescent bulbs in 2014. Nationwide, of roughly 6 billion light bulbs used in American homes, 3.6 billion are incandescent bulbs. Lighting sucks up roughly 14% of America’s electricity; replacing all those Edison bulbs with LEDs could cut that demand in half.