Vol. 20   No. 2
Summer 2015
  • MGE Talks Business
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LEDs a great fit for farm lighting

LEDs a great fit for farm lighting

Travis, Phil and Aaron Richards added LED lighting to their dairy farm with the help of MGE Shared Savings.

Businesses that need lights nearly round-the-clock don't take lighting for granted.

Phil Richards, who owns and operates the 300-head Rock-N-Rich Holsteins Dairy Farm in Cross Plains with his wife, Julie, and sons, Travis and Aaron, knew there must be a better alternative to the metal halide lighting he was using in his cow barn.

"The metal halides were pretty dim, and I was concerned about energy efficiency and light quality. The lights stay on in our barns almost constantly—they're only off from 1 to 3 a.m.—and the right light level can improve milk production," Richards said.

After speaking with an electrician, Richards decided to investigate light-emitting diodes (LEDs). "I went to a farm that had some, and the light quality was good. They seemed worth learning more about."

In addition to their excellent light quality, which Richards describes as "close to daylight," a level that encourages more activity with the cows and helps increase production levels, LEDs can tolerate cool temperatures, dust and damp conditions. They are more energy efficient than metal halide.

LEDs also have a longer life. Under the right conditions, LEDs can last for 50,000 hours compared to 20,000 hours for metal halide. Longer life makes LEDs an especially good option for bulbs located in hard-to-reach places like the rafters in the Rock-N-Rich barn.

Richards was excited about the many advantages of LEDs but knew he couldn't afford the project price tag. Although LED prices have dropped, the cost to update his barn was roughly $22,000 (for the bulbs, wiring and installation). "Then my electrician told me about MGE and their Shared Savings program," Richards said.

Shared Savings makes energy efficiency possible

Shared Savings is a revolving loan program established for MGE customers. MGE provides up-front financing and the customer repays the loan through energy savings. "MGE comes in, reviews the proposed project and sets a funding limit," said Jesse Shields, a commercial account manager at MGE. "The customer can structure the loan to meet their needs with a payback period of up to 10 years."

To participate in the Shared Savings program, a business must submit their proposal prior to construction/installation. The approval process has two steps:

  1. A technical check to make sure the project meets MGE's energy-saving standards.
  2. Due diligence to determine that the customer will be able to meet the terms of the loan.

More than 300 MGE business customers have used Shared Savings. "It's not always easy for businesses to get a loan to fund an energy efficiency upgrade through traditional financing, especially for this length of time," Shields said. "Shared Savings helps make these projects possible."

LEDs and Shared Savings bring many benefits

"The difference in light quality was obvious right away," Richards said. "Even if you're in another building, you can tell how much brighter the lights are in the barn."

And benefits go beyond the barn interior too. "We often don't need to turn on outside lights because the LEDs do such a good job lighting up the exterior," Richards said. "Plus, I'd say the milk production levels seem to be up, and it's just a nicer environment for the cows and the staff."

Although the lights haven't been in long enough for the farm to gather a full year's worth of energy data, payback is estimated at just under two years.

Lamp Watts Annual kWh Annual energy cost
39 Metal halides 400 125,268 $16,285
39 LEDs 148 46,349* $6,025*
3 Metal halide wall packs 320 7,708 $1,002
3 LED wall packs 30 772* $94*
Estimated payback for $22,000 cost 1.97 years

*Forecasted

"There is absolutely no way we could have afforded this update without MGE," Richards stressed. "I appreciated how easy it was to apply for the program, especially as we were going through the application during harvest. Jesse was extremely responsive, and everything happened quickly—it was less than six weeks from the time we started the process until the lights were installed."