Energy efficiency

Streetlighting switch could save local authorities millions of pounds

20 Mar 2015


  • Glasgow City Council becomes first UK local authority to utilise the UK Green Investment Bank’s specially designed loan to finance the switch to low-energy streetlighting
  • Glasgow project will see a £6.3m loan used to finance the replacement of 10,000 lanterns along Glasgow’s main arterial roads
  • New standardised ‘Green Loan’ product designed to make it easier for local authorities across the UK to convert to low energy streetlighting and deliver annual savings

UK Green Investment Bank plc (GIB) has today announced that it has finalised an agreement to finance the first wave of the Glasgow City Council’s plan to replace 70,000 existing streetlights with lower energy, lower cost alternatives.

GIB will provide finance to the City to replace 10,000 street lanterns along its main arterial roads, leading into the city, at an expected cost of £6.3m.  The new low-energy streetlights will pay for themselves through energy savings while generating further carbon savings for the city.

The new lights are expected to use at least 50 per cent less energy than the old versions and will cut the council’s greenhouse gas emissions by in excess of 18,000 tonnes over the next 18 years. The energy saved by the LEDs is equivalent to the total annual electricity consumption of 1,250 households.

The next phase of Glasgow’s LED lighting project will replace a further 60,000 street lamps and their columns, which is complementary to the City Centre Future Cities Demonstrator Project. This incorporates intelligent lighting and focuses on the City Centre.

GIB’s Green Loan offers UK local authorities a low, fixed-rate loan over a period of up to 25 years. It has been specifically designed to finance public sector energy efficiency projects, and allow for repayments to be shaped to fit within savings and alleviate already tight budgets by bringing immediate financial benefits to local authorities. The product can also include a development loan to help local authorities with the costs of progressing their plans. In reaching a final agreement with Glasgow, GIB has now produced a standardised process which other local authorities can use to save and money in agreeing a finance package to convert their street lighting estate. This includes a route-map to help local authorities think about and progress a business case for transitioning to low-energy streetlighting; a financial model to demonstrate how the loan can be shaped so that interest and repayments are only made from forecast savings; and standardised loan documentation. GIB is working with a number of other local authorities and public bodies across the UK about financing their transition to low energy streetlighting.

LEDs can provide 100,000 hours of light, compared with just 15,000 hours for standard bulbs.

Switching all of the UK’s streetlights to LEDs could prevent up to 475,000 tonnes of carbon dioxide from being emitted into the atmosphere, the equivalent of taking over 200,000 cars off the road.

Lord Smith of Kelvin, Chairman, UK Green Investment Bank, said:

The UK spends more than £300m a year to switch on street lights, night-after-night, but less than 10 per cent of the UK’s 7.4 million street lamps are currently fitted with LEDs.  Across the UK we can cut that bill by two thirds by replacing old streetlights with new LEDs, saving councils money and cutting our carbon emissions at the same time.

Councillor Gordon Matheson, Leader of Glasgow City Council and Chair of Sustainable Glasgow, said:

Glasgow is striving to become one of Europe’s most sustainable cities.  We can achieve this by improving our energy efficiency, cutting our carbon emissions and generating financial savings for the city.  Our deal with the Green Investment Bank is helping us get there.

Street lighting is an essential service and so it makes sense to deliver it in a cost-effective way, which is exactly what we’ve been able to do here, while supporting Scotland and the UK hit their climate change reduction targets.

Gregor Paterson-Jones, Managing Director of Energy Efficiency, Green Investment Bank, added:

Councils that make the switch to LEDs could make financial savings immediately, with their street lighting electricity bills up to 80 per cent lower and overall energy consumption down by around 20 per cent. This would make significant contributions to financial budgets and carbon reduction targets.

Uptake of LED street lighting has been slow so far, but we have spoken to more than 100 local authorities across the UK over the past year and believe one of the barriers is the impact the up-front cost of replacing bulbs with LEDs, columns and intelligent management systems would have on annual budgets. But the GIB’s Green Loan can help councils to spread that cost over up to 25 years, increasing loan repayments as the savings increase and showing real ‘spend to save’.


Tel: +44 20 3037 4014

Clare Holland, Glasgow City Council: / 0141 287 0229

Notes to editors

About the UK Green Investment Bank

The UK Green Investment Bank was launched in November 2012. With £3.8 billion of funding from the UK Government, it is the first bank of its kind in the world.  It is a "for profit" bank, whose mission is to accelerate the UK's transition to a greener economy, and to create an enduring institution, operating independently of Government.

About Glasgow City Council

Glasgow City Council provides services to a population of around 600,000. Glasgow is Scotland’s largest city, the economic and cultural powerhouse of the Scottish economy and has the UK’s largest retail centre outside of London. It is the Local Government Chronicle’s Council of the Year 2015.