About two-thirds (64%) of the United States is covered by prescriptive lighting rebates, according to BriteSwitch, a rebate fulfillment company. These rebates can significantly reduce the installed cost of new lighting in existing buildings and improve payback by 20-25%, which would reduce a two-year payback to about 1.5 years.
Rebates became popular in the 1990s as utilities began engaging in least-cost resource planning. As reducing demand costs a fraction of what it costs to build new generating capacity on a per-kWh basis, utilities act more efficiently by incentivizing customers to adopt energy-efficient building technologies. Various types of incentives are available, but the simplest and most popular is the prescriptive lighting rebate. The rebate program identifies a list of technologies and products that are found to provide suitable performance while saving energy. After installation, the customer receives a rebate check as a reward.
Despite the proliferation of the LED source, traditional lighting product rebates remain available. The most popular rebates are for high-pressure sodium, ceramic metal halide, pulse-start metal halide, high-bay T8 and T5HO and induction lighting upgrades. After the phase-out of a majority of linear T12 lamps in 2012, the baseline has switched from T12 to T8. Funding has moderated, but rebates are available that can cover a significant portion of the installed cost, resulting in a satisfying payback for installing these solutions.
In 2016, many rebate programs have begun to focus more heavily on LED products. The most popular rebates cover downlights, track lighting, high-bays, garage luminaires, linear luminaires, outdoor pole luminaires and linear replacement lamps. Linear replacement lamps previously covered by custom rebates are now being increasingly covered by prescriptive rebates. Average rebates are continuing to decline as LED product costs fall. In 2015, the average LED product rebate declined 20-30%, according to BriteSwitch. The company expects a more modest 5% decrease in 2016.
Lighting controls continue to be included in the large majority of prescriptive rebate programs. In contrast with other technologies, average rebate dollars have remained somewhat stable, declining just 10% over the past five years. Average rebates cover a significant portion of the installed cost. The most popular rebates cover remote, luminaire-mounted and wallbox occupancy sensors; light sensors; and daylight dimming systems. Many programs are removing their requirement that controls be hardwired, allowing wireless controls.
We are at the beginning of a new phase on prescriptive rebates for lighting controls, which is inclusion of networked lighting controls. In addition to determining energy savings, rebate programs are currently working out whether to treat them as individual components or as complete systems. The result is we may see networked lighting controls begin to enter a significant number of programs in 2017.
An example is the Advanced Lighting Controls pilot incentive program offered by Consumers Energy in Michigan. Recognizing energy savings of 65-95%, Consumers Energy provides a bonus incentive of $0.18/kWh saved (not to exceed $50,000) and another $0.08/kWh through the Consumers Energy Commercial & Industrial Custom program, subject to that program’s caps and limits. According to Consumers Energy, these incentives can reduce normally a five-year payback to three years. To qualify, at a minimum, the solution must provide centralized programming and control with a remote interface; data collection, storage and reporting; step dimming capability; implementation of at least three control strategies such as scheduling, occupancy sensing and daylight harvesting; and granular zoning (maximum 16 luminaires per zone).
A major development in networked lighting controls being included in prescriptive rebate programs is the Commercial Advanced Lighting Controls (CALC) program being developed by the Northeast Energy Efficiency Partnerships (NEEP). The program will involve training, demonstration projects and other market transformation activities designed to address barriers to adoption of networked lighting controls. In tandem, the DesignLights Consortium (DLC), which maintains the Qualified Lighting Products List (QPL), is working on a networked lighting control system specification, which will allow this product type to be included in the QPL. This is a major development, as the QPL determines what products qualify in many prescriptive rebate programs. Previously, most utility companies considered networked lighting controls as part of their custom programs. The draft specification requires the control solution to be networked; feature reconfigurable, granular and layered zoning; be able to enact occupancy sensing, daylight harvesting and institutional task tuning; feature continuous dimming; be secure; and provide a graphical interface for operators.
Getting the rebate
There is substantial funding available to reduce the cost of upgrading existing lighting systems, but they can take a lot of work.
Get to know the program. It is beneficial to get to know the program early—what incentives are available, what products qualify, approval deadlines and how to get the rebate. This means determining the process and how long each step takes. According to BriteSwitch, application and pre-approval takes an average 31 days. After installation, it can take up to 120 days or longer to receive the rebate check. The entire process can take five or six months.
Programs often require pre-approvals. Pre-approval is required in about 80% of rebate programs. Starting installation before approval is granted can disqualify the project for a rebate.
Identify products that qualify. The large majority of rebate programs recognize only qualifying products for rebates. Often, this involves the product demonstrating compliance with performance criteria published by the Consortium for Energy Efficiency (CEE), DesignLights Consortium and ENERGY STAR. CEE maintains a list of reduced-wattage and high-performance lamps and ballasts. ENERGY STAR and the DesignLights Consortium (via its Qualified Products List) maintain a list of LED products. For example, ENERGY STAR listing is required for LED screwbase lamps in about 94% of rebates. It’s recommended to verify these listings on the listing organization’s website, not just the manufacturer catalog sheet. For lighting controls, the program may require a minimum controlled number of luminaires or wattage to qualify.
Stay on top of the program. Rebates are becoming more competitive as a growing number of programs run out of funding during the year. Historically, BriteSwitch has seen 11% of programs run out of money during the year, which climbed to 24% in 2015. Stay on top of current funding to ensure a rebate isn’t promised that can’t be delivered.
Stay engaged with your application. Be sure to comply with all requirements and deadlines. Avoid mistakes on required paperwork such as an incorrect address (a common mistake). As rebate programs accept thousands of applications, mistakes can occur at the utility’s end too, so some follow-through can be beneficial. Rebates take time and work.
Become a trade ally. Many rebate programs maintain a network of qualified service providers, or trade allies. It can be beneficial to join these networks to gain valuable recognition and access to program resources such as training.
For a list of rebates and other energy incentives available across the United States, visit www.dsireusa.org or contact a manufacturer.