Councils are paying upwards of $400 million a year for street lighting, but with the system owned and benefitted from by electricity distribution utilities, there is concern that these utilities are stalling the move to more efficient, cleaner and safer LEDs.
According to the Institute of Public Works Engineering Australasia, switching to LED street lights could halve electricity consumption, save local councils across Australia up to $87 million and prevent 720,000 tonnes of CO2 emissions a year.
However, while local councils are legally responsible for providing street lights – and pay for them – more than 90 per cent are owned and maintained by private and public electricity distribution utilities, a new practice note released by IPWEA says.
In an article on The Fifth Estate last year, a commenter highlighted what he saw as a split incentives problem, and called out state-owned NSW electricity distributor Ausgrid for delaying an LED rollout, saying it was not in the company’s financial interest to hasten such a move.
Ausgrid responded that it was important to roll-out technology in a cost-effective and responsible way for everyone.
The IPWEA note says councils are pushing for lighting changes at a rate faster than utilities are willing to undertake. Where councils own street lighting, however, LEDs have taken off, with 27 of the 30 largest LED street lighting deployments in the world being council-owned.
Utilities overestimating light values
The note also exposes a trend of utilities grossly overinflating valuations for older lighting assets, such as luminaires, brackets, and dedicated columns and underground supplies, which, IPWEA says, “frequently do not appear to reflect the age, condition and obsolescence of the assets”.
In NSW, for example, the residual asset values for old lights claimed by utilities can be up to several hundred dollars a light, creating a significant barrier for efficient lighting as councils would have to pay out the values. Alternatively, utilities would have to write-down the value of these old lighting assets.
“This is a challenging issue under [utilities’] current business model and regulatory framework, which in some cases places extremely high valuations on the old assets that councils want removed,” the practice note states.
Transferring ownership to councils could help, IPWEA says
IPWEA has suggested that state governments “urgently change” the regulations covering street lighting or help to transfer ownership to councils on fair terms, as has happened in New Zealand and parts of Canada.
“Utilities wishing to remain in the street lighting business will need to develop management and service approaches that are able to embrace the emerging lighting technologies that councils are seeking and explore opportunities to add value for street lighting customers and other stakeholders,” the note says.
“Where utilities are unable to better meet council needs, councils, governments and regulators will need to reconsider the future form of ownership, financing and management of street lighting.”
The practice note recommends that state governments reconsider whether electricity utilities are best-placed to manage the need for street lighting reinvestment, and either facilitate the transfer of assets to councils or introduce regulations to align the interests of utilities with councils and the wider community.
It also suggested writing down the valuation of old street lights to reasonable levels reflecting their age and obsolescence.
LEDs save lives, reduces crime
In addition to the huge cost and emission savings, the practice note also highlights the improved safety outcomes for drivers and pedestrians where LED lighting is in use.
“The whiter LED light is cleaner and tests in the US have shown it enables drivers to respond more quickly in emergencies,” IPWEA sustainability director Dr Stephen Lees said.
“As well, results from Los Angeles show a measurable reduction in street crime and vandalism after LED street lighting was introduced.”
It should also be noted that a move to LEDs could also save utilities costs associated with maintenance, estimated at a reduction of more than 50 per cent compared with the costs of maintaining traditional lighting.
“It’s a win-win for energy savings, maintenance savings, emission savings and added safety, but it requires some political leadership at state government level to realise these gains,” Dr Lees said.
Dr Lees said IPWEA believed government acting so councils could more easily upgrade street lighting would help Australia reach its greenhouse gas emission reduction targets while saving ratepayer dollars and improving safety outcomes.
IPWEA will be conducting workshops in October on the street lighting practice note.
Read the full note.