Sylvia Blackburn, 72, suffered serious head injuries outside Bedford Road Lower School, Kempston, last December.
Brian Wright, 55, of Kempston, told Luton Crown Court he had been blinded by the setting sun.
He accepted he had struck Mrs Blackburn but denies causing serious injury by dangerous driving.
Mrs Blackburn is now being treated in residential care.
Judge Michael Kay QC paused the case for five minutes so Mr Wright could compose himself after he told the court how he had turned his victim's "world upside down".
Mr Wright said: "I understand Sylvia was a much-loved lollipop lady, who was loved by the children.
"I am truly sorry for what I have done to her and her family."
Mr Wright's VW Golf failed to stop for a red light, the jury heard.
The married mother-of-three, a lollipop lady for 20 years, had been on duty in Bedford Road as pupils left school.
When the traffic lights turned red, Mrs Blackburn, who was wearing appropriate clothing, stepped out to escort a woman and her six-year-old daughter across the road.
Prosecutor Sally Mealing-McLeod said traffic in the other direction had stopped, but the defendant did not, and hit her.
Mr Wright, of The Dell, said he could not remember if the traffic lights were red or green.
"I was totally blinded by the sun," he said. "I just heard a bump. I was in total shock.
"Since that day I have thought of nothing else other than Sylvia Blackburn and her family and the position I have put them in."
The court heard the sun was 10 minutes from setting and could have been shining into Mr Wright's eyes.
The trial continues.

Foster's time of 11.62 seconds earned automatic qualification as she finished second in her first-round heat.
However, Smyth exited from the men's 100m as he finished fifth in his heat in 10.66 - .44 secs outside his best.
Reid, meanwhile, false started in his heat and was disqualified.
Paralympic star Smyth, 27, appeared to start well in heat four but faded after 50m as he finished fifth in 10.66 seconds.
"I got out of the blocks really well and was in a good position in the early stages, however, I then tightened up and people started to pass me," explained Smyth.
"I was hoping to do better but I still haven't fully recovered from my hamstring injury.
"[But] It has been an incredible experience for me to represent Northern Ireland at the Commonwealth Games as I missed out on Delhi because of injury."
London-born Reid's first Northern Ireland outing proved a brief affair as he false started in heat three.
Reid, 20, switched allegiance to Northern Ireland in February as his mother hails from the province.
Birchfield Harrier Reid won European Junior Championship 200m silver last year and his main focus in Glasgow will be the longer sprint.
Smyth is also scheduled to run the 200m at these championships but the Londonderry man's 2014 season has been badly affected by hamstring trouble and the 100m is regarded as his stronger event.
A time of 10.45secs would have secured a fastest loser's progression to Monday's semi-finals.
Foster looked to be in a tricky heat but her time of 11.62 - despite being .22secs outside her best - earned her second spot behind Australia's Melissa Breen [11.54].
On the opening date of athletics action at the Games, Northern Ireland hopeful Gladys Ganiel produced a gutsy run to take 12th in the women's marathon with her finishing time of 2 hours 40.29 minutes, only 57 seconds outside her personal best set in Berlin last September.
The American-born runner was making her first appearance at a major championship at the age of 37.
Ganiel is not a full-time athlete and her day job is working as an assistant professor in conflict resolution and reconciliation at Trinity College, Dublin.
Kenyan Flomena Cheyech Daniel took the gold medal in 2:26.45 ahead of her compatriot Caroline Kilel [2:27.10] with Australia's Jess Trengove [2:30.12] winning the bronze.
A driver who knocked down a lollipop lady broke down in tears in court as he said he was "truly sorry" for her and her family.
[NEXT_CONCEPT]
Northern Ireland's Amy Foster safely progressed to the women's 100m semi-finals at the Commonwealth Games but Jason Smyth and Leon Reid bowed out of the men's sprint event.