Patrick Clouden, the CEO of Consumer Energy Solutions Inc., took the time to speak to IMPO about LED lights and their increasing popularity, their benefits and even Consumer Energy Solutions’ unique approach to lighting.
Maura Falk: Can you explain how and why LED is becoming the “new normal?”
Patrick Clouden: When you look at everything, for example, the energy efficient programs that are being pushed by the federal government as well as the advancements in energy efficiency across the board including LED lighting, it just makes sense. The fact that businesses are able to cut their consumption and make their businesses more energy-efficient is the driving factor behind LED’s becoming the new normal. It not only saves money, but it also reduces costs, and the quality of the product has been improved which has driven the price down, making them more affordable. Overall, it is a better light and it is cost effective. It is a no-brainer and that’s why it will be the ‘new normal.’
For example, in the auto industry you are seeing the use of LED expanding. Originally, you would have LED’s outside in order to show the cars in a better light at night, but now it is also in the show rooms. Another example is the Super Bowl. This year the entire stadium was lit by LED lights. So this is going to become the new normal in terms of energy efficiency and because it provides more effective ways to become truly more energy-efficient.
MF: Can you describe some of the most significant benefits to LED lighting?
PC: First of all, the quality of light is improved: it is a better and more natural light source. They also use less electricity so they are more energy-efficient. This results in businesses spending less for higher quality. Plus, they last longer. They last — depending on how you use them — between 5 to 10 times longer than regular lighting. LED lighting also helps to reduce maintenance costs and helps businesses avoid potentially dangerous situations changing out the lights. Then over time, the LED’s are able to create significant savings and are able to produce tremendous benefits in a time where we really need to have not only improved energy usage as a country, but also as individual businesses and people. So overall, LED’s help businesses cut costs and save money — money that specifically gets driven back to the bottom line.
MF: Can you explain Consumer Energy Solutions unique approach to LED lighting and the practice of leasing LED lights?
PC: We sell energy service contracts here at Consumer Energy Solutions, Inc. We have been doing this for almost 18 years. So, we have a customer base of businesses — thousands of businesses — under energy service contracts. We also work hard and take the time to educate our customers on LED lighting and the benefits of LED lighting. Now we also offer LED lights to our customers and we actually have more people signing up for LED lighting for their businesses and organizations.
We have found that educating our customers is important because many still need instruction in this subject, and it is important to increase people’s understanding and knowledge because when people understand LED’s and the benefits, they are more likely to invest. We have also found that with more education customers receive, the more likely they are to take responsibility for moving to LED’s and for making the necessary changes.
The leasing of LED lights is also very interesting. The equipment is getting so good and reliable that you are beginning to see finance companies willing to finance them just like they would to facilitate the leasing of a car. This happens because they know the lights are going to last way longer and that there is a huge return on it internally. So you can literally take the money that someone is spending every month anyways and take a percentage of that money and apply it to the LED lighting and actually reduce the business owners cost by around 20 to 30 percent — and even up to 70 percent in some cases. Which makes it a positive cash flow situation right from the get go. In other words, the saving more than pays for the lease so it makes it a no-brainer business decision once you begin to understand that. So just like leasing a car, you can lease these lights and the savings will cover the costs.
MF: Is this something you are seeing predominantly with large scale manufacturers or with varying sizes?
PC: We are seeing it with both small- and large-scale manufacturers. You have smaller groups doing it as well as the huge companies doing it. And there are some niche markets. For example, we deal with some guys who have LED lighting programs specifically for pizzerias, and they offer 20 percent and it is a niche. So you’ll see companies that come along and deal with the LED’s in these niche markets. There is a niche in the automotive industry as well for example.
MF: How do you see LED lighting evolving in the future, what can manufacturers expect?
PC: Well, again what we will see is these specialty manufacturers taking part, and then you will have the large manufacturers buying in. That coupled with the free market, will drive the cost down and there will be more and more people and businesses using LED’s. That’s how it will become the new normal. I have read that the current LED market is about 4.5 billion dollars a year and they project it to be up to $45 billion in the next ten years. That is a huge growth, so there will be lots of opportunities there for manufacturers to supply that demand. As we go forward, it is actually very exciting.