Tim Brakemeier/PA

A prize winning light bulb has been launched in the US over the weekend, with a whopping price tag of $60 (£37).

The LED bulb is expected to last around 100,000 hours, giving a life span of about 20 years. So will it really save consumers money?

The bulb, made by Dutch electronics giant Philips, is the most energy efficient yet and went on sale in America yesterday to coincide with Earth Day. The bulb swaps filaments for light-emitting diodes to provide illumination, which is reported to replicate natural light.

That hefty price tag reflects the cost of the components, especially the top-notch diodes that give off the light, and is the price that commercial customers will pay. Philips is offering discounts immediately – cutting the price to $50 for consumers, and working on deals with retailers to discount it even further. This means the bulb will cost anywhere from $20 to $60 (£12-£37).

Energy efficient
The bulb was developed in response to the $10 million Bright Tomorrow competition run by the US Department of Energy that aimed to find an efficient alternative to the energy-wasting 60-watt incandescent light bulb.

Philips was the only entrant for the competition and its design underwent 18 months of testing before being declared a winner. The contest stipulated that the winning bulb be sold for $22 in its first year on the market, so the $60 price tag has attracted some criticism in the US.

Stiff competition
Even with the hefty price tag, the new LED bulb will save consumers money over the life of the bulb as it uses just 10 watts of power and far outweighs the rest of the market in life span.

However, consumers have been slow to embrace LED bulbs and they face competition from compact fluorescent lights, which are nearly as energy efficient yet cost as little as £3. Many use around 15 watts for 60 watts worth of light and look more 'normal'. On the Philips LED bulb, the light-emitting surfaces are yellow when unlit and shine white when switched on.

A cheaper, less efficient version of the LED bulb is already sold by Philips in the US and Europe from around £9.

Higher wattage incandescent bulbs are currently being phased out. Production of 100 watt bulbs has ceased in the US and Europe, while production of 60 watt bulbs has been stopped in Europe and is being phased out in the US. From 2014, incandescent bulbs of 40 watts or above will be banned in the US.

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