Finding the nearest three light sources is the main bottleneck, and in scenarios with many lights, is highly dependent on having a broadphase algorithm to filter them out early. If they did it the naive way, the algorithm becomes O(number of sources * number of lit objects).

But that doesn't seem to be their concern here, either. Optimizing broadphase collision is a well-understood problem, and the scenario of finding the nearest is only slightly different from that.