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
- LED Rebate Amounts Are Flat for a Second Year
- Number of Horticulture Rebates Nearly Triples While Amounts Decrease
- Networked Lighting Control Rebates Continue To Grow
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.
See the current rebate climate map and how it has changed over the past 14 years
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.
Average Prescriptive Rebate in North America
Average Prescriptive Rebate in North America
Average Prescriptive Rebate in North America
Source: BriteSwitch RebatePro 2/2022
See where these rebates are with RebatePro
Number of Horticulture Rebates Nearly Triples While Amounts Decrease
Horticulture lighting has been an attractive new area for both electric distributors, contractors and manufacturers. Using LED lighting lets customers save energy and also tune the lighting to their specific needs, increasing production yields and improving margins. As a result, the horticulture lighting market was exceptionally robust in 2021, and it's projected to continue its growth through this year.
Incentives for horticulture lighting have been very strong, with the number of rebates tripling in the last year. These incentives have also become much more standardized in 2022. Previously, most rebates for horticulture lighting were custom, often based on kWh saved. This year, that shifted and now over 60% of the rebates for horticulture lighting are prescriptive. Prescriptive rebates are usually set dollar amounts with clear guidelines and requirements, making them easier to estimate and apply for.
While the number of rebates for horticultural LEDs grew, the average prescriptive incentive amount decreased by roughly 25% in 2022. This change is primarily due to the introduction of new, lower rebates where no previous rebates existed which brought down the average. Still, at an average incentive of $102 per fixture, horticulture lighting is one of the highest rebate product categories currently available.
Networked Lighting Control Rebates Continue To Grow
Many manufacturers and industry experts have seen controls as the next frontier in lighting. Not only can controllable lighting solutions offer increased energy savings, but they also allow occupants to customize and personalize their lighting for increased comfort and productivity. Networked Lighting Controls (NLC) take it to the next level by providing even more analytics and controllability to fixtures in a facility.
Rebates for these NLC systems have been around for several years. It's exciting to see the number of utilities incentivizing these systems has increased by 16% this year.
In contrast, the average rebate amounts for NLC have stayed the same this year. It mirrors the trends seen in traditional controls like occupancy sensors and photocells. The incentives for all these control technologies have remained remarkably stable over time, with little change in the incentive amounts or availability. It's a big contrast compared to standard lighting rebates that have varied significantly over the years.
While there are a lot of rebate programs out there for NLC, the biggest challenge the programs face is the market's knowledge of these systems. Networked Lighting Controls are more complex than simple lighting retrofits and require additional training and understanding to implement correctly. Rebate programs have tried to tackle this hurdle by hosting training sessions to help their networks of contractors and distributors better understand the value proposition behind NLC and how to better market the solutions to their customers.
Rebates Can Help You Succeed in 2022
With continuing price increases for materials and labor shortages, rebates will prove especially important in 2022. As the costs of projects go up, it's essential to research what rebates are available for any project you'll be doing this year. While they won't cover the full cost of upgrades, as they sometimes did in the past, they can often help offset these cost increases and improve a project's payback by 20%.
If you are planning a project and need help with estimating and filing rebates, BriteSwitch can get you the most money with no hassle.
If you want to create leads and increase your sales with rebates, our RebatePro and Rebate Assistant tools can help you find and identify rebates for your customers.