In 2024, commercial lighting rebates continue to be a strong and widely available incentive for the adoption of energy-efficient lighting and controls in existing buildings. Trends in prescriptive rebates include a slowdown in demand for rebate amounts, an increase in incentive programs, an overall increase in average rebate amounts, and the growth and increased standardization of Networked Lighting Controls (NLC) rebates.
Recall that rebates are programmatic investments made by utilities and energy efficiency organizations to reduce demand for electricity, which is often more cost-effective than adding new supply. Traditionally, these programs have focused on lighting, primarily for existing buildings.
Rebate availability is one of four key trends BriteSwitch is tracking through 2024. After a period of declining prescriptive (fixed-value) rebates, incentives have stabilized in 2024, the company said in a press release. "In fact, 2024 rebate amounts are up an average of 2 percent for LEDs and 5 percent for controllers. For most LED products, average rebates in North America are near record levels. The best rebates continue to be for LED lights used to replace HID lights such as high bay and pole lights.
One of the reasons for the fluctuating value of the discount is the level of plan funding. For the past several years, plan funding has been depleted in the fall, and a short-term incentive program was implemented in 2023, bucking the previous trend.
BriteSwitch noted in its report that rebates for connected lighting controls are also on the rise. The report states, "In dollar terms, the average rebate amount forNLCs increased by 4% in 2023.
LED Product Rebates
The commercial lighting rebate program has strongly favored LED technology for many years. In 2024, the most popular rebates continue to be for LED replacement lights, recessed/flat-panel lights, downlights, wall-packed lights, parking lot lights, outdoor pole-mounted light shelves, and high-bay lights.
Average rebates have decreased over the years due to falling costs in the market, but LED rebates stabilized in 2021 and have held steady or even increased since then, likely due to inflation. According to the BriteSwitch database, LED products as a whole will grow by an average of 2% in 2024, with the largest increases (6-7%) in LED outdoor and parking lights.
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Lighting Controls
In most of the United States, where lighting rebates are offered, so are controls. As shown in Figure 3, popular rebates include remote-mounted, wall-mounted, and fixture-mounted occupancy sensors; photocells; and daylight dimming systems. in 2024, the average increase in these categories is between 2 and 7 percent. The high average dollar amounts make lighting controls an attractive upfront addition to lighting upgrades.
Connected lighting control discounts, a relatively new category of specialty discounts, are showing signs of standardization. Networked lighting control discounts are intelligent systems in which devices are connected in a network to develop control strategies. This type of system can provide significant energy savings, making it attractive to discount programs, while the availability of data can produce non-energy benefits.
Traditionally, incentive programs have viewed networked controls as a customization option, but in recent years, significant prescriptive rebates have begun to appear. Meanwhile, the DesignLights Consortium (DLC) has released a new list of qualified products for connected lighting controls, which most prescriptive programs use to find systems eligible for rebates.
According to BriteSwitch, the number of utilities offering incentives for NLCs in 2024 grew by 8 percent to 450, with about 53 percent of the rebates being prescriptive. Additionally, most rebates are offered on a per fixture basis, with an average cost of $211 per fixture installed and controlled.
Obtaining Rebates
To determine what rebates are available in your area, contact local utilities and energy efficiency organizations. Some manufacturers offer resources to identify opportunities. To take advantage of such local programs, consider signing up as a trade ally, which may provide market visibility as well as training and other resources. Otherwise, in-house resources or outsourcing are often needed to manage the process.
Since rebate programs are largely non-standardized, be sure to understand the given program and its requirements, and keep a close eye on changes and current funding levels. Although less common, in some areas, participation may run out of funds early. Please note that rebates are not guaranteed or may pay less than expected.
Pre-approval is usually required before installation can begin. All forms must be completed correctly. Note which products are eligible (e.g., if a DLC listing is required) and make sure the exact model number is listed. An inspection (on-site or virtual) may be required to verify the installation.
The Future of Rebates
Rebate programs evolve as technology and markets evolve, so as LED saturation increases, incentives may be adjusted so that significant lighting energy savings can continue to be realized.
Among those that may be included in the evaluation list and may be promoted in the future are high-efficiency LED lighting; replacement of first-generation technologies with current-generation technologies (potentially with a $ per watt rather than a per product rebate); lighting redesign; bundling of lighting and controls into one package; networking and fixture-level lighting controls; HVAC integration; and specialized applications such as UV disinfection, data, and dimmable lighting. Because lighting controls are underutilized in existing buildings, they are likely to play an important role in future rebate portfolios.
Making rebates work
Commercial lighting rebates provide a powerful incentive for building owners to adopt energy-efficient lighting and controls. While rebates require effort and carry some risk, many building owners have used them to finance the installation of new lighting and controls.
The overall outlook for commercial lighting rebates in the U.S. in 2024 is very strong, with rebates readily available and detailed lists of qualified products available at no cost. They are particularly attractive for projects involving solutions that add lighting controls, including NLC. While obtaining lighting upgrade projects may become more challenging as LED saturation increases, rebates can play an important role in converting this business.
Rebates are a planned investment by utility and energy efficiency organizations to reduce electricity demand, as it is often more cost-effective than adding new supply.
When it comes to energy efficiency, rebates play a crucial role in incentivizing individuals and businesses to adopt more sustainable practices. By offering financial incentives, these programs encourage the purchase and installation of energy-efficient products and systems.
At Uslighting, we understand the importance of rebates in promoting energy efficiency. That's why we strive to provide high-quality LED lighting solutions that not only help you save on energy costs but also qualify for rebates offered by utility companies and government agencies.