Concerns have been raised that electricity distribution utilities are avoiding the installation of more efficient LED street lights because the move conflicts with their economic interests.

The Institute of Public Works Engineering Australasia (IPWEA) claims that conflicts of interest created by the ownership of public street lights by electricity distribution utilities has led to them avoiding or deferring the installation of more efficient, environmentally friendly LEDs.

A practice note released by the IPWEA notes that while local councils in Australia bear legal responsibility for the provision of public street lighting, costing them collectively in excess of $400 million per year, the installations remain 90 per cent owned and maintained by utilities companies.

The ownership of public street lamps by electrical distribution utilities means that it is not in their economic interests to introduce equipment, such as LED lamps, which consume less energy and thus incur lower costs. According to IPWEA, utilities at present are failing to install the new lights as quickly as councils would like.

The IPWEA’s statement follows accusations levied against NSW public utility Ausgrid last year that split incentives had compelled the company to delay the deployment of LED technology.

The IPWEA believes the rollout of LED street lamps would bring tremendous benefits to both local governments and the environment, halving power consumption and reducing Australia’s CO2 emissions by as much as 720,000 tonnes per year while also saving councils throughout the country as much as $87 million collectively.

The City of Sydney managed to save $300,ooo and reduce energy usage by over 27 per cent in the 16 months following the installation of 2,600 LED lights starting in March 2012, reducing carbon emissions by 1,547 tonnes.

The installation of the lights was part of a three-year plan to replace a total of 6,448 conventional street lamps with LEDs.

The IPWEA has urged state governments to follow the example set by New Zealand and Canada, and “urgently change” regulations in relation to street lighting or transfer ownership to councils.

“Councils, governments and regulators will need to reconsider the future form of ownership, financing and management of street lighting,” said the IPWEA in the practice note.

The practice note points out that LED street lamps will produce other benefits in addition to lower energy consumption and reduced greenhouse gas emissions. These include improved traffic safety, due to the clarity of the whiter light which enables drivers to react better to emergencies, as well as a measurable reductions in petty crime and vandalism achieved in cities such as Los Angeles.

Maintenance expenses are also significantly lower for LED’s, with an estimated reduction of more than 50 per cent in costs as compared to conventional street lights.