Market Snapshot

Of the 31 municipalities involved in the survey, 74% have installed at least some LED traffic signals, and 6% were considering the use of LEDs. About 19% did not have plans to install any LED signals at the time of the survey. In total, the 31 communities surveyed were responsible for the installation and maintenance of nearly 5,600 LED traffic signals.

Most of the LED signals that have been installed or are currently being considered for installation are red signals and arrows. About 50% of the municipalities that have used LEDs have only installed red signals. A significant number of communities, about 42% of those using LEDs, have also installed orange pedestrian DON'T WALK signals, while only 8% of the communities using LEDs have installed any green or amber signals.

These numbers are related to the more mature and less expensive LED technology (aluminum indium gallium phosphide, or AlInGaP) used in red and orange signals as compared to that used in green signals (indium gallium nitride, or InGaN). InGaN LEDs are newer, and in many ways are still an evolving technology; because of this, prices for these LEDs have been higher than for AlInGaP LEDs. Yellow signals use the less expensive AlInGaP technology, but are rarely used because the very short duty cycle of yellow signals compared to red signals minimizes the effect of energy savings. They are also rarely used because intensity requirements for yellow signals, such as those specified by the Institute of Transportation Engineers (ITE), are much higher compared to red and green signals. Thus, yellow signals require more LED components and are often more expensive for this reason.

With a population of nearly 30 million people at the time of the 1990 U.S. Census, and a very strong trend recently in population growth, California has both a large base of existing traffic signals and the potential for significantly more in the future. This is also reflected in the survey results. When asked whether LED signals were being used primarily for retrofit of existing signals or in new construction, 96% of the communities using LEDs are retrofitting them into existing installations, and 54% are using them in new construction (percentage totals exceed 100% because many communities are using LED signals in both types of installations).

Economic information

Without a doubt, LED traffic signals are significantly more expensive than the incandescent technology that they are designed to replace. The LRC asked agencies for typical prices of signals. On average the prices for LED traffic signals were:

• 300 mm red signals: $132 (range $93-$220)
• 200 mm red signals: $101 (range $70-$190)
• 300 mm red arrows: $92 (range $72-$150)
• orange pedestrian signals: $106 (range $93-$120)

In comparison, the average cost of an incandescent traffic signal lamp is $2.34 (ranging from $0.50 to $6). The reflector housing that supplies the optics in an incandescent traffic signal costs from $15 to $20. This cost difference surely plays a role in decisions to use or not to use LED traffic signals.

Of the communities that have used LED technologies, 48% have received rebates from the local utility companies and 8% received loans or financial assistance from other organizations. About 28% of the communities using LEDs reported that they did not receive any financial assistance. In the remaining 16% of communities using LEDs, the source of funding, if any, was unknown. These figures indicate that rebates and loans have played a large part in the implementation of LED traffic signals, although there is still a significant percentage of agencies, almost a third, which began to install them without any such funding.

Motivations

For those communities using LED traffic signals, 96% stated that energy savings was one of the principal reasons for using them. About 26% stated that lower maintenance requirements of LEDs was a principal reason. The availability of funding or rebates was cited by 9% of their communities as a reason for installing LED signals, and 4% did so because LEDs represent technological innovation and were attractive for that reason. The lower power requirements of LED traffic signals compared to incandescent signals (10-20 W versus 100-150 W) certainly boosts their potential for acceptance. Maintenance savings are recognized far less.

As for those agencies that have not installed LED signals, 25% of them stated that the lack of rebates or funding sources was a primary reason for not doing so. Shortages in product supply, low electrical costs, and unfamiliarity with LED technology were all cited by about 12% of those communities not using LEDs as a primary reason for their decision.

Whether the availability of funding is really a significant factor remains to be seen. It may, however, help simply to increase awareness about the technology. Overall, LED traffic signals are viewed widely as being expensive: 45% of the survey participants believe that they are expensive compared to 21% that believe them to be inexpensive. Significantly, 28% believe that they are expensive over the short term and inexpensive over the long term, while 7% believe red LED signals to be inexpensive and green signals to be expensive. Thus it appears that a sizeable proportion of agencies consider life-cycle costs or at least simple payback in their decision-making process.

With respect to the impact of electricity rates on LED signal use, a question asking whether rates affect the decision to use LED signals found that the rates did affect 65% of all of the agencies surveyed in their decisions to use or not to use LEDs, although 10% included in this 65% said the rates were only a secondary issue. About 29% of the communities reported that their electrical rates did not influence their decisions about LED signals, while 6% did not know.

1. Survey Questionnaire
2. List of Municipalities Surveyed
3. Market Snapshot
4. Specification and Purchasing
5. Technical Issues
6. Potential Market Activities
7. Summary and Conclusion