Energy-efficient lighting for UK businesses: How LED lighting can cut your bills

A growing number of UK businesses are switching to energy-efficient lighting to help cut their business electricity bills. A recent study from PWC, the professional services network, found that more than half (55%) of businesses have made LED lighting upgrades at their premises.

Having the right lighting is important for all businesses. Whether you're operating factory machines or serving up coffee, your employees need to have good lighting in place to be able to see and do their work properly. Choosing the right energy-efficient lighting can make a difference when it comes to cost savings and doing your bit for the environment

But shining the light on the best energy-efficient lighting that still does the job while keeping costs low can sometimes be a challenge. In this guide, we’ll take a closer look at energy-efficient lighting, the benefits it can bring to your business, and some of the best options available. 

Five-point summary

• Energy-efficient lighting can save businesses money and benefit the environment. It works by reducing electricity consumption by using bulbs and fixtures that consume less power.
• Benefits for the environment include reduced greenhouse gas emissions, lower energy demand, resource efficiency, reduced heat emissions, and less light pollution.
• LED lighting is the most energy-efficient option, lasting longer and using up to 80% less energy than halogen bulbs. Other benefits of energy-efficient lighting include lower maintenance costs, improved lighting quality, and flexibility in lighting control.
• Factors to consider when choosing energy-efficient lighting include lighting goals, energy efficiency, type of lighting, fixture compatibility, dimmability, lifespan, initial costs, and government grants.
• Proper disposal is essential, as LED bulbs can be recycled, while CFLs containing mercury should be taken to recycling centres.

What is energy-efficient lighting?

Energy‑efficient lighting uses modern bulbs and controls to give businesses the light they need while using less electricity. This technology helps UK businesses of all sizes cut carbon emissions and can reduce lighting costs by 50–80% compared with older technologies.

Energy-efficient lighting is all about getting the light you need while minimising electricity usage. Energy-efficient lighting aims to reduce the amount of electricity used to produce light, leading to lower business energy bills and a smaller carbon footprint. 

Energy-efficient light bulbs and fixtures provide all the illumination you need while consuming significantly less power compared to traditional incandescent bulbs.

Compact fluorescent lamps (CFLs) and light-emitting diodes (LEDs) use a lot less power and shine just as or even brighter than normal bulbs. 

What types of energy-efficient light bulbs are available?

There are a few different types of energy-efficient light bulbs to choose from. Here's a breakdown of what's available and what they're useful for, to help you make the right choice for your business/

• LED bulbs - These super-efficient bulbs can last up to 25,000 hours, and only cost between about £2 and £6 to buy. Running costs are low at around £1.70 a year. These are great for everyday use and best for offices, retail spaces, and warehouses.
  
• CFL (compact fluorescent lamp) - These cost between £1.50 and £3 each and can last for up to 10,000 hours. Running costs are about £2.50 a year. Good for steady, regular use, making them ideal for desks, corridors, and kitchen areas.
  
• Halogen energy savers - At between £1 and £2 each, these are among the cheapest to buy, but are less efficient than others - they usually only last for about 2,000 hours. And running costs are higher, at between £7 and £8 a year. They give a warmer light but don’t last as long, and are best used in spotlights and meeting rooms.
  
• Smart LED bulbs - A bit more pricey at between £5 and £20, but running costs stay low at around £1.50 to £2 per year. They can also be app or voice-controlled, meaning they're ideal for automation and energy tracking. Perfect for smart offices and flexible working spaces.

How does energy-efficient lighting contribute to environmental sustainability?

Energy-efficient lighting plays a pivotal role in promoting environmental sustainability, especially through the reduction of electricity consumption. 

Here's a breakdown of some of the positive impacts it has on the environment:

• Reduced greenhouse gas emissions — Traditional lighting relies heavily on electricity generated from fossil fuels. By consuming less electricity, energy-efficient lighting reduces the demand on power plants, leading to a decrease in greenhouse gas emissions like carbon dioxide, which is a big driver of climate change. A small light bulb swap might not seem like a lot, but this can even have an impact on the UK’s goal of becoming net zero by 2050. 
• Lower energy demand — By cutting down on energy usage, energy-efficient lighting eases the strain on the grid, especially during peak demand times. This can help in reducing the need for additional or newer power plants and preserving natural resources.
• Resource efficiency — Modern energy-efficient lighting technologies like LEDs have a longer lifespan compared to traditional incandescent bulbs. And because it lasts longer, this means fewer resources are needed for the production, transportation, and disposal of these over time.
• Reduced heat emissions — Unlike traditional lighting, energy-efficient bulbs emit less heat which is good for reducing cooling costs in warmer climates or during the summer months.
• Reduced light pollution — Some energy-efficient lighting options are designed to reduce light pollution, which benefits both the environment and our health. And if less light is wasted than traditional lighting, it also translates to energy savings!

The transition to energy-efficient lighting is a relatively simple yet impactful step towards creating a more sustainable and eco-friendly future for businesses.

How lighting upgrades support UK net zero and Environmental, Social and Governance (ESG) targets

Upgrading to energy‑efficient lighting is a simple, visible way for UK businesses to support the national target of reaching net zero carbon emissions by 2050. This is because lower electricity use directly cuts demand for grid power and associated greenhouse gas emissions. 

Modern LED and smart lighting projects also feed into wider ESG strategies and sustainability reporting, helping businesses demonstrate credible carbon‑reduction action when bidding for public sector contracts or large corporate tenders where environmental performance is increasingly scored and scrutinised.

Here are some ways your business could incorporate the changes:

• A high street fashion shop could replace old halogen spotlights with LEDs and add window‑display timers to cut evening energy use while still keeping the storefront bright enough to attract customers.
• A small office on a business park might change fluorescent panels to high‑efficiency LED panels with occupancy sensors in meeting rooms and corridors, reducing wasted lighting when spaces are empty.
• A café or bar can use warm‑white LED lighting with dimmers to create ambience for customers while reducing electricity use during quieter periods or daylight hours.
• A unit on an industrial estate could fit high‑bay LED fittings and motion sensors in aisles, so only active warehouse zones are lit, supporting both safety and measurable carbon reductions for ESG reporting.

Which type of lighting is considered the most energy-efficient for businesses?

Your lighting choice can make a big difference in the energy efficiency of your business. 

LED lighting is heralded as the most energy-efficient option for both homes and businesses thanks to their lower energy consumption rates compared to traditional CFLs and halogen bulbs. While lasting longer than incandescent bulbs, halogen bulbs — which were banned in the UK in September 2021 — only last for up to 2,000 hours. In comparison, LED bulbs and tubes can last between 25,000 - 50,000 hours and use as much as 80% less energy than halogen. 

What are the benefits of energy-efficient lighting?

In addition to the long lifespans of energy-efficient lighting and their cost savings tendencies, there are also a lot of other benefits that they offer.

• Lower maintenance costs — With a longer lifespan, the maintenance required for lighting systems is reduced. Fewer bulb replacements translate to lower maintenance costs, making energy-efficient lighting an attractive option for both residential and commercial spaces.
• Improved lighting quality — Modern energy-efficient lighting options have greatly improved in terms of lighting quality, gone are the days of candle and flame! Offering a wide range of colour temperatures and better rendering, improved lighting quality can result in visibility and aesthetics, enhancing the ambience of a space like an office space, coffee shop or restaurant dining area.
• Flexibility and control — Energy-efficient bulbs often come with added features like dimmability and compatibility with smart lighting systems. This flexibility allows for better control over lighting levels, which could lead to further energy savings for businesses. The directional light output of LEDs offers more control in how and where light is distributed, which can be good for highlighting certain areas or creating desired lighting effects. For example, you could create atmospheric lighting in a boardroom for presentation meetings or in an entrance area to a restaurant. 

While energy-efficient lighting can help to cut your energy bills, you need to be aware that the savings made can vary by region. This is because business electricity unit rates and distribution charges differ between network areas. For example, a business in London may save a different annual amount than a similar business in the North West, even if they cut the same number of kilowatt hours.

What factors should businesses consider when choosing energy-efficient lighting solutions for their premises?

Picking the right energy-efficient lighting for your business is a smart move that can help save you some money and brighten up the space you work in in a more eco-friendly way.

• Lighting goals and needs — First, you’ll have to consider what your business's lighting goals and needs are. Are you looking for lighting that sets a certain mood? Do you need it to focus on specific tasks or just to lighten up the room? Pinpointing your goals can help steer you in the right direction. 
• Energy-efficiency effectiveness — You’ll also need to look into the energy ratings of different lighting options. The better the efficiency, the lower your energy bills are likely to be. Look for bulbs with a higher lumen per watt (lm/W) ratio — they give off more light while sipping less energy.
• Type of lighting — Weigh the pros and cons of each light option that you have. LEDs and CFLs will both have different advantages and disadvantages, but it’s what works best for your business. 
• Fixture Compatibility — Check if the new lighting options actually fit with existing fixtures. Compatibility means a smooth setup and the best performance from your lighting systems.
• Dimmability — While it’s not really needed, the option to dim your lights can be great. Dialing in just the right amount of light can help save energy when you don’t need to use full brightness. 
• Life span and maintenance — Energy-efficient bulbs like LEDs last a lot longer than traditional ones, meaning fewer replacements and less maintenance over time. This can save both time and money, making operations smoother.
• Initial costs — Although energy-efficient lighting has a higher upfront cost, the long-term savings on energy bills and reduced maintenance often make up for it. Plus, as demand increases, prices are trending downward, making it an easy investment for long-term savings.

Peeling back the layers of each of these can help ensure you’re making a solid choice for your business. Switching to energy-efficient lighting isn’t just a win for your wallet but also a thumbs up for the planet!

How much can UK businesses save by upgrading lighting?

Upgrading from older halogen or fluorescent lighting to efficient LEDs can cut lighting electricity use for many UK businesses by around 50–80%, depending on current equipment and hours of use. The examples below use simplified figures to illustrate potential savings; actual results will vary by tariff, usage pattern and building type.

Small office (10 staff, open-plan)

• Old tech - Mixed halogen and fluorescent fittings using around 6,000 kWh per year at 30p/kWh ≈ £1,800/year.
• LED upgrade - More efficient LED panels and bulbs using around 2,400 kWh per year ≈ £720/year.
• Estimated saving - About £1,080 per year, with a typical LED upgrade cost of £1,500 paying back in roughly 1.5 years.

High street retail shop

• Old tech - Halogen spotlights and fluorescent tubes using around 8,000 kWh per year ≈ £2,400/year.
• LED upgrade - LED spots and strips using around 3,200 kWh per year ≈ £960/year.
• Estimated saving - About £1,440 per year, so a £2,500 lighting project could pay back in under 2 years.
  

​Small warehouse unit

• Old tech - High‑bay discharge or fluorescent fittings using around 15,000 kWh per year ≈ £4,500/year.
• LED upgrade - High‑bay LED fittings using around 6,000 kWh per year ≈ £1,800/year.
• Estimated saving - About £2,700 per year, meaning a £5,000–£6,000 upgrade can often pay back within 2–3 years, especially if combined with smart controls.

Budgeting for and financing LED and smart lighting upgrades

One downside of upgrading your lighting and control systems is that it comes with an initial outlay. If you've not got the funds available, you'll need to budget for the upgrades and work out how long it'll take to repay that investment. Here are some things to consider.

Phased upgrades vs whole‑site replacement

• Some businesses choose to upgrade all lighting in one project to maximise savings quickly; others phase upgrades, starting with the highest‑use areas to spread costs.
• A phased approach can align with lease breaks, refurbishments or equipment replacement cycles.

Using energy savings to self‑finance upgrades

• Because LED and smart lighting can cut lighting costs significantly, the savings often cover the upfront investment within one to three years for many SMEs.
• After payback, ongoing savings improve cash flow and can be reinvested in other efficiency or growth projects.

Leasing and lighting‑as‑a‑service options

• Some suppliers offer leasing or “lighting‑as‑a‑service” deals where you pay a regular fee rather than a large upfront cost, sometimes linked to guaranteed savings.
• Businesses should compare quotes carefully, looking at total cost over the contract, product quality and flexibility versus a standard purchase and installation.

Combining finance with energy contracts

• When planning lighting upgrades, review your current business electricity contract; aligning project timing with a tariff switch can help maximise savings.
• Using Bionic to compare business energy deals once your new lighting is in place can help ensure you are not overpaying on your reduced usage.

Are there any government grants available for businesses adopting energy-efficient lighting?

As of September 2023, the UK government has been offering various grants and incentives to encourage energy efficiency and reduce carbon emissions among businesses. But there is no specific program dedicated to energy-efficient lighting. You can check if your business is exempt from paying any green taxes on the government site.

How to roll out an energy-efficient lighting plan

Implementing an energy-efficient lighting plan may simply involve replacing all the bulbs in your building. Alternatively, you may want to carry out a more thorough plan that uses monitors and sensors. 

In either case, using the checklist below will help make sure you get the right lighting solutions for your business.

Finding the right lighting for your business

• Carry out a simple lighting audit - List existing fittings, bulb types, wattages and hours of use in different areas (e.g. office, warehouse, kitchen, customer areas). Note any rooms that are over‑lit, under‑lit or where lights are left on when not needed.
• Prioritise high‑use and high‑cost areas - Focus first on spaces where lights are on all day, such as open‑plan offices, shop floors, corridors and warehouses. These areas usually deliver the quickest savings and fastest payback when upgrading to LEDs.
• Check fixture compatibility and lighting needs - Confirm whether new LED lamps will fit existing fittings or if full luminaires need replacing. Consider colour temperature, brightness and beam angles so the lighting supports tasks, safety and customer experience.
• Choose suppliers and installers - Get quotes from reputable electricians or lighting specialists that include product specs, warranties and estimated savings. Ask for options that include smart controls, sensors or zoning if relevant to your site.
• Monitor, review and optimise - After installation, compare energy usage and bills before and after the upgrade to check savings. Adjust settings (like dimming levels or sensor timings) to fine‑tune comfort and efficiency over time.
• Tie in with Bionic’s energy comparison - Once lighting has reduced your kWh consumption, use Bionic to compare business electricity tariffs and lock in a competitive electricity deal on your new, lower usage.

Smart lighting controls for UK workplaces

If you're looking to add motion sensors or other lighting controls, here are some things to consider:

• Motion and occupancy sensors - Fit sensors in low‑traffic areas like corridors, stairwells, storage rooms, toilets and some warehouse aisles so lights only come on when needed. This is especially effective where staff regularly forget to switch lights off.
• Daylight sensors and constant‑lux control - Near windows and skylights, daylight sensors can automatically dim or switch off artificial lighting when natural light is sufficient. This maintains consistent light levels for staff while avoiding unnecessary electricity use on bright days.
• Zoning and timers for multi‑site or multi‑floor businesses - Split large offices, warehouses or multi‑site businesses into zones so you can control lighting separately for different floors, departments or trading hours. Use timers and schedules (for example, pre‑opening, trading hours and cleaning schedules) to ensure lights are not left on outside operating hours.
• Smart controls and central management - For larger businesses, cloud‑based or central control systems can manage lighting settings across multiple sites, providing data on usage and savings. This helps energy managers fine‑tune performance and feed into ESG and net zero reporting.

Lighting, staff wellbeing and business perception

Although saving energy and money will most likely be the main reason for switching to energy-efficient lighting, you need to consider staff and customers. For example, if you run a restaurant, kitchen lighting will need to be bright to ensure staff can do their jobs properly, but the restaurant area will need softer tones to help set the ambience. Here are some things to consider:

• Comfort and productivity for staff - Good‑quality LED lighting with appropriate colour temperature and brightness can reduce eye strain, headaches and fatigue compared to poor‑quality or flickering fluorescent lighting. Better visibility and more pleasant spaces support productivity, staff satisfaction and safety in offices, shops, hospitality venues and warehouses.
• Customer experience and brand feel - In retail, hospitality and customer‑facing spaces, lighting plays a key role in how products, décor and people look and feel. Thoughtful, efficient lighting design can make a business feel modern, welcoming and professional, supporting brand perception and customer spend.
• ESG and reputation in tenders - Visible upgrades like LED lighting and smart controls help demonstrate practical environmental action within broader ESG plans, which is increasingly valued in public sector and large corporate procurement. Clear evidence of reduced energy use and improved working conditions can support tender responses and sustainability reporting.

How do you dispose of energy-saving light bulbs properly?

All the materials used in making LED light bulbs can be recycled. They don’t contain any toxic material and should be taken to a local recycling centre for proper disposal. 

CFLs can be recycled; however, they contain a small amount of mercury and shouldn’t be thrown away with regular rubbish. Instead, take them to the tip or recycling plant where they can be properly recycled. 

Get your business set with Bionic

No matter the size of your business, even the smallest of changes can make a difference, and energy-efficient lighting can be a great start. 

If you need more help understanding business energy, head over to our energy guide pages for more information. Or, get in touch today with the Bionic team to compare your business energy needs, including electricity and gas.

Energy-efficient lighting for UK businesses FAQs  

Here’s an at-a-glance guide to some of the most frequently asked questions about energy-efficient lighting for UK businesses: 

What is the best energy-efficient lighting for UK businesses?

For most UK workplaces, LED lighting is the best energy-efficient option because it uses far less electricity and lasts much longer than old halogen or fluorescent bulbs, helping cut business energy bills.

How much can a small UK business save by switching to LED lighting?

A small UK office or shop can often cut lighting electricity use by up to 50–80% by switching from halogen or older fluorescent bulbs to LEDs, depending on current usage and tariffs.

Do UK businesses need planning permission to change to LED lighting?

Most UK businesses do not need planning permission to replace internal lighting with LEDs, but listed buildings or major external signage changes may require local authority approval.

Are there any UK grants to help pay for energy-efficient lighting?

There is no national grant solely for lighting, but some UK and local schemes include energy-efficient lighting within wider energy-efficiency or decarbonisation funding, so businesses should check GOV.UK and local council or LEP programmes.

What type of LED lighting is best for shops and retail spaces?

Retail businesses usually benefit from warm to neutral white LED lighting with good colour rendering (CRI), using spotlights to highlight products and bright, even lighting on key customer areas like tills and displays.

How can UK warehouses and industrial units improve lighting efficiency?

Warehouses and industrial units can combine high‑bay LED fittings with motion sensors, daylight controls and zoned lighting so that only occupied areas are lit at the right brightness.

How long do commercial LED lights last in a business environment?

Commercial‑grade LED bulbs and fittings typically last from 25,000 to 50,000 hours, meaning many UK businesses will only need to replace them every few years, even with daily use.

How does better lighting help my business beyond energy savings?

Energy-efficient lighting can improve comfort, visibility and safety for staff and customers, support a more professional brand image, and play a visible role in your wider sustainability and net zero plans.