March 2, 2022
Commercial Lighting Rebate Trends for 2022
Published with permission from BriteSwitch, LLC
For the first time since they began, utility rebates for LED solutions were flat year over year
Lighting rebates have played a key role in helping millions of customers upgrade to more efficient lighting. Over the years, rebate programs that first debuted to motivate customers to move from T12 technology to T8 have adapted and evolved. Now, lighting incentive programs are all about LEDs and controllability. In addition, the programs have adopted new ways of working and shifted from mail and fax-in forms to interactive online applications. 2022 is no exception, and here is a look at the 2022 trends in commercial lighting rebates.
77% of the US Has a Commercial Lighting Rebate
Currently, commercial customers in over 3/4 of the US can be eligible for a rebate for installing energy-efficient lighting or controls. This coverage is up from the 74% that we saw at the beginning of 2021. It's also close to the highest we have on record, which was 79% in 2017.
Still, some parts of the US have little or no rebate coverage. Notable standouts are Alaska, Kansas, North Dakota, and West Virginia, with no active rebate programs. Ohio is also remarkable. While the major utilities in the state provided rebates for many years, they were forced to discontinue those programs in 2020 due to a ruling in the state legislature, and unfortunately the incentives have not returned this year.
LED Rebate Amounts Are Flat for a Second Year
For years, LED rebates reliably decreased 10 - 20% annually depending on the product category. A large part of this decline was to match the incentive levels to the falling prices of LED solutions. It left many wondering when it would bottom out.
Last year, for the first time ever, the rebates for LED solutions were flat year over year. That trend continues in 2022, with only a 1% decrease across all product categories. This pattern makes sense when you look at the industry. 2021 saw a record number of price increases due to supply chain issues and inflation, so it's no wonder rebate amounts have stayed pretty stable. The higher levels are needed to make the project paybacks favorable enough for reluctant customers who have not yet upgraded.
The two categories with the most significant change this year were downlights and integrated track lighting. These two fixtures were the first LED product types to receive rebates over ten years ago. Their maturity may be the reason that their rebates are slowly being reduced.
Source: BriteSwitch RebatePro 2/2022
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