Cost-Effectiveness of Compact Fluorescent Lighting

Compact fluorescent technologies have been steadily improving. There has been increased interest in utilizing compact fluorescents to provide cost-effective energy savings for electric utilities in the residential sector. Several utilities in the United States have already distributed compact fluorescents to consumers free of charge. This study assesses the cost-effectiveness of compact fluorescents from the perspectives of consumers and utilities in the Pacific Northwest, where electricity rates are, on average, the lowest in the United States. The study also assesses cost-effectiveness from a societal perspective. Secondary hearing impacts and the value of reduced emissions of pollutants are incorporated into the analysis. Results indicate that compact fluorescents are more likely to be cost-effective as the perspective upon which they are assessed is broadened. Thus, they are least likely to be viewed as cost-effective by consumers, more likely to be considered cost-effective from a utility perspective, and almost always cost-effective from a societal perspective. Given these differences, is is suggested that policies be developed to capture the societal benefits of compact fluorescent retrofits through alternative regulatory or market mechanisms