I've been trying to figure it out but no success. Basically, all lights that cast shadows are red in Creation Kit and I can't see their light, no matter how close or far I am from it. I've put only one in the whole cell(house) and it's still just red. I can see it when I get in game, but I cannot see how it works in Creation Kit (which is essential for proper placement). Any ideas?

Perhaps you have desactivated the shadows ? Go to Preferences-> Shaders tab -> check "Shadows".

Do you have the lights turned on? "A" toggles them on and off in the CK. To make a light brighter or dimmer, scale it with the S key and mouse.

When they are red, it means there are too many being rendered. IIRC, the max is 3 or 4 shadow lights can be rendered on screen at any given time. You can help this by either cutting back on shadow lights, and/or using room bounds if its a dungeon or large interior.

It could also mean your shadows is disabled as Planteur said; but yes. The max is 4. Only 4 shadow lights can be rendered onscreen at once. Of course, you can still use plenty in one level, you just have to make sure your roombounds prevent more than 4 at a time from being rendered.

I wonder why it's 4, as graphics cards can do a single frame render on up to 8 shadows at once. Maybe consoles are limited to 4? Imagine the potential if on PC it was 8... twice the shadows. Twice the epic level designing.

And twice the shadow bug to fight with

Have you taken a look at it in the lights debug mode? You might just have too many lights in one area. If you see a lot of red around that light in debug mode, try moving the light around until things at least turn purple, ideally blue or green. Hope that helps.

Keep in mind, 4 lights means 4 shadows PER OBJECT. If you have 10 objects, that's 40 shadows. 100 objects, 400 shadows...

Yes, but limitation-wise graphics cards can render 8 shadows a frame. That means it can do 8, and it would stress the video card absolutely no more than the 4 it already does. It's when you have to do multi-frame rendering and other garbage that you start losing performance. But modern cards can handle 8 exactly as easily as they can handle 4.

Thanks for all the tips guys, I'll check it out asap!

Edit: Fixed it, thanks to Planteur. Somehow my Shadows got unchecked in the Shaders tab and I did not notice.

So long as you only ever have 2 objects in your scene, you're fine then. Any more, and you exceed your "8 shadows" limit with 4 shadowcasting lights.