Because the headlamp assembly for all W124's including 500E's are NOT designed for the "arc" light of a HID, you're only getting about 45% efficiency.
Moroever, unless you ONLY want the 500E's pencil-beam, you will LOSE your H4 highbeams, unless there is a HID kit that does both HIGH and LOW beams.
IMHO, you will get better performance and lighting if you do the following in order:
1) Get Hella or BOSCH Euro 500E headlamps (contact Paul at Puma- http://www.puma-access.com
2) install headlamp relays using 10-ga. wire ( http://lighting.mbz.org/
) along with Hella ceramic hi-temp H4 connectors http://lighting.mbz.org/tech/relays/relays.html
3) upgrade to OSRAM or Narva Rallye H4 bulbs (130/100);
4) upgrade your H3 pencil-beams to relays & 10-ga. wire and 80W or 100W bulbs ( http://lighting.mbz.org
5) upgrade your alternator from a 1997+ S500 or SL500 (150-amps!) with a 2-ga. wire from the alternator to the battery;
6) install a relay to activate LOW beams as well as HIGH, and PENCIL beams.
Assuming stock bulbs, with item #6, you're putting out 340-watts of light;
With 130/100w H4's and 80w H3's, 620-watts of power, NOT including your FOGS!
1988 360TE AMG