Intelligent Energy

From the horse's mouth: LED bulbs are too pricey

From the horse's mouth: LED bulbs are too pricey

Posting in Education

Lighting vendor Nexxus comes right out and says it: Consumers don't like the high price of energy efficient bulbs, no matter how much money and electricity they save in the long run.

Lighting vendor Nexxus has come right out and all but admitted it: consumers don’t like the high price of LED light bulbs, no matter how much electricity and money they save in the long run.

Nexxus entered the consumer LED market in March with an agreement to sell its Array brand of LED bulbs through the Lowe’s retail chain.

It’s been slow going.

Overall sales of Array products to the consumer have been below what we had anticipated,” the Charlotte, N.C., company said when it recently announced a loss of $1 million on sales of $2.1 million for the third quarter ended Sept. 30.

“In response, and in partnership with our major customer, we are exploring additional opportunities to increase retail sales and in-store inventory turns,” it added, without naming Lowe’s.

With more than a hint that prices are too high for the average consumer, it explained that, “These opportunities may include utility rebate programs, price concessions, sales initiatives, marketing programs, advertising campaigns, training sessions and point-of-sale educational materials.”

Although the price of LED bulbs is starting to decline, they generally sell for between $25 and $50 – a hard sell when the consumer can buy a traditional incandescent bulb for sometimes less than a dollar.

Thus, Nexxus and other lighting companies including Philips and Cree have recently reported difficult business in consumer LEDs, even though the bulbs save consumers a bundle over time because they consume only about 20 percent of the electricity of an incandescent. In theory they virtually eliminate replacement bulb costs because they last for a purported 25 years, although many consumers dispute that longevity.

Image: Svilen.Milev via Wikimedia

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Mark Halper

Contributing Editor

Mark Halper has written for TIME, Fortune, Financial Times, the UK's Independent on Sunday, Forbes, New York Times, Wired, Variety and The Guardian. He is based in Bristol, U.K. Follow him on Twitter. Disclosure