What Your Christmas Lights Are Really Costing You This Year

Decorating for the holidays used to be simple. Today, it’s become its own economy.

The global Christmas decoration market is projected to hit the mid-single-digit billions this year, growing from $5.33 billion in 2024 to $5.62 billion in 2025.

These days, consumers have many options to choose from, ranging from incandescent and LED lights to laser light projectors and inflatable characters. And Americans are spending big: 50% say they are planning to drop $150 or more on Christmas decorations this year.

But that’s just the upfront cost. For many households, the bigger surprise shows up later, folded into their utility bill. Part of the issue is the sheer proliferation of decorations. But the other, more insidious factor is electricity prices. Americans are paying about 9.6% more on average for electric bills in 2025 than in 2024, according to research from the Center for American Progress. 

We spoke with experts about what a “normal” setup actually costs to run, why LED versus incandescent still makes the biggest difference, and which add-ons do the most damage to your bill.

What a ‘normal’ display costs

Every neighborhood has that house: every eave and window meticulously outlined, a cast of inflatable characters, maybe even a laser light show or fake snow display. Naturally, running their setup costs far more than a modest roofline outline.

For this article, though, we’ll start with a single-family setup and a clear set of assumptions.

"The standard display would be around 10 strings of lights," or about 1,000 bulbs, for an average home in 2025, says Victor Zhang, chief technology officer at PCBAIR.

If those are LED mini lights and you run them for a typical schedule of six hours a night through December, your cost could be a manageable $3 to $5 for the entire season, assuming a cost rate of 18 to 19 cents a kilowatt-hour, according to Zhang.

It's a reasonable price for some holiday cheer. But swap in the classic, incandescent version of that same display, and your bill is going to look very different.

“If you have a string of 1,000 old school mini bulb incandescent bulbs, the same display will cost you $25 to $35,” Zhang says.

It’s a sizable difference, and a gap that can grow even larger if you run your display for longer than six hours a day for a single month.

“A holiday season usually lasts six to eight weeks," says Megan Doser, owner of Doctor Fix It Plumbing, Heating, Cooling & Electric. "People turn the Christmas lights on right after Thanksgiving and turn them off in the first part of January." 

Those extra weeks can run up your bills, bringing your total cost close to $100 or more, if you're running an inefficient display for a longer stretch of the day and holiday season.

Incandescent to LED: The fastest way to cut the cost

Maybe that's what happened last year, but you want this holiday season to be different. The fastest, most reliable way to save money is a simple bulb swap, according to all of the experts we spoke to.

That's because LEDs fundamentally change how much electricity your display draws every hour it’s on, and that can dramatically shrink your bill.

Courtney Klosterman, a home expert at Hippo home insurance, puts the headline number plainly: “Choosing LED holiday lights can save you up to 75% as they use a quarter of the energy incandescent lighting does.”

The reason is simple: “An LED string consumes 5 to 10 watts, while an incandescent string consumes 40 to 100 watts,” explains Zhang. 

That kind of wattage gap adds up fast when you’re running multiple strands for hours a night. Still, some homeowners resist making the switch, often preferring the warmer glow of incandescents or not wanting to toss a perfectly good set of working lights.

But if you’re on the fence, Zhang offers a one-line rule of thumb that puts the math in perspective: “The easiest explanation for the contrast is the 90% Rule: Replacing conventional lighting with LEDs reduces the lighting component of your electricity bill by 90%.”

The add-ons that raise your bill

Even if your string lights are fairly efficient and you’ve already switched to LEDs, add-ons can easily tip you back into the red on your holiday display. They’re the pieces that seem small in the moment (“It’s just one 8-foot Santa Claus!”), but they draw more power than you think, or they’re the kind of decoration you leave running for long stretches without noticing.

Inflatables are the clearest culprit, because in addition to lights, they run motors.

“Giant inflatable decorations have the largest appetite,” says Zhang. “In order to keep the thing inflated, you have to power a motorized fan continuously. The price of one huge inflatable may itself be $10 to $15 a month.” 

And if you have more than one, as many people do, those costs just compound.

Then there are the smaller pieces that don’t look like a big deal until you tally them up: the wreath on the front door, the garland on the railing, the lit swag in a window. Those accents are easy to set and forget, and if they’re older or incandescent, they can have a disproportionate impact on your utility bill.

Zhang warns that "lighted wreaths and garland may be using outdated, power-sucking bulbs or incandescent lights that can, if plugged in, boost the price by $2 to $5 each.”

The easiest ways to save, while keeping the holiday spirit

If you can’t part with your incandescents or your inflatables, there’s still a way to save money on your decorations this year. 

Zhang offers a simple fix: “Turning your lights off automatically at midnight instead of letting them shine until sunrise has the effect of cutting your costs in half." 

Doser agrees, but adds that the method matters less than the outcome: “Reducing the runtime is the best way to reduce electricity consumption by all Christmas decorations, no matter how you do it: manually turn them off, use plug-in timers, or smart plugs.” 

Just make sure your setup is reliable.

Zhang warns of zombie timers that can be an “older, mechanical timer that becomes stuck in the on position, causing your display to run 24/7, thereby doubling your bill at night.”

And if you take nothing else, take this: Bulb type sets the baseline, but runtime decides the final bill. Audit what’s actually plugged in and prioritize the highest-impact zones instead of lighting what no one can see.