Street light program has saved Bethlehem $13 million over 15 years, officials say
BETHLEHEM, Pa. — Bethlehem has saved $13 million over 15 years, thanks to a street light initiative that not only brings in more money to cover associated expenses, but is more environmentally sustainable.
Public Works Director Michael Alkhal, at a budget hearing Wednesday, said the city issued a 20-year bond to buy all street lights within its limits from then-PP&L back in 2009.
That included more than 5,000 non-decorative and 2,500 decorative lights.
“That was pretty close to the time when deregulation occurred, which allowed entities to purchase energy independent from the local power company,” Alkhal said. “That opened the door for us to be able to do this.”
“That was pretty close to the time when deregulation occurred, which allowed entities to purchase energy independent from the local power company. That opened the door for us to be able to do this.”Bethlehem Public Works Director Michael Alkhal
From there, charges related to debt service, energy costs as well as outsourcing operation and maintenance were determined to be more affordable than what the city would’ve paid the power company for associated capital costs, knockdowns and more.
The city began upgrading street lights to LEDs in 2014, beginning with non-decorative lights, using a 10-year loan. That estimated 70% savings on energy costs was put back into funding the upgrades, Alkhal said.
In 2021, officials decided to assign the city’s Electrical Bureau to maintain the street lights, resulting in $200,000 more in annual savings as opposed to outsourcing.
Alkhal said the past two years have seen upgrades of more than 2,500 LEDs using the in-house workforce.
The Electrical Bureau budget also dropped about $400,000 for 2024, he said.
More budget impacts
The proposed 2024 budget is estimating $732,000 for street lighting, compared with a projected $2.5 million without the initiatives once the LED upgrade debt service is retired.
Alkhal predicted that come 2025, when the initial project bond is retired, street lighting expenses will total $360,000 verses a potential $2.8 million.
“You can see these were very impactful initiatives that have helped the city save a tremendous amount of money,” Alkhal said.
“We took out a 20-year bond that if you didn’t think about it deeply, you’re like, ‘why is the city borrowing money to take out a bond?’ Because it’s going to save us millions of dollars.”Bethlehem Mayor J. William Reynolds
At his budget address on Monday, Mayor J. William Reynolds said the city went from paying $300 a year per light pole to saving big money that ultimately benefits its employee pensions, health care programs and more.
“We took out a 20-year bond that if you didn’t think about it deeply, you’re like, ‘Why is the city borrowing money to take out a bond?’” Reynolds said. “Because it’s going to save us millions of dollars.”
That saving is expected to continue in years to come, he said.
Councilwoman Grace Crampsie Smith on Wednesday gave “special kudos” to Public Works for the street lighting initiative, saying it’s always great to find ways to save and not incur additional costs.