Outlook 2012: Canadian LED firm has plan for local production

PHOTOGRAPHER: Edward Munger Jr.

A Canadian company, banking on the benefits of energy efficiency, expects to migrate south into Montgomery County this year and create at least 10 jobs at the outset of operations with the help of state economic development funding.

The company’s plans to patronize other local firms for its building blocks is also expected to help those businesses maintain jobs.

ProTerra LED, based in Brantford, Ontario, is poised to fill commercial orders for its improved light-emitting diode system, one that promises to provide more than 75 percent energy savings for companies that make use of the old-style fluorescent lights.

The company created its first rendition of the LED in 2008, right about the time the economy crashed, said John Johnston, its CEO. The struggling economy left a hole in capital investment money, so the company began focusing on research and development to improve on the already cost-saving technology.

Improvements made to the design include better heat removal and the need for less current — both factors in extending the life of the light fixtures. At 40 percent cooler than current LED lighting, the fixtures are expected to last 16 times longer — yielding a five-year, unconditional warranty.

The company’s improved LED lighting system can replace a 400-watt metal halide fixture with one that uses only 125 watts of electricity yet throws off more light.

INCREASED LIGHT

The increase in light output is based in the wide angle lens, another change to the technology ProTerra is patenting.

The fixtures are being marketed to large facilities like warehouses, and Johnston said the technology has been proven for more than two years now.

With indications the economy will start picking up, ProTerra is eager to start full-scale production on its own. At present, the company contracts with a manufacturer to put its lighting together, but the Amsterdam plan will change that a bit.

“This is what makes it nice, because we can now, with new investment coming in, invest in our own manufacturing base. If we had our own manufacturing base here going, we [might] not be as eager to get it going there,” Johnston said.

Going through a contract manufacturer is a “very expensive way to do business,” Johnston said, so the company plans to maintain its “umbilical cord” with that manufacturer while gradually ramping up its own production in Amsterdam.

ProTerra is contracting with Samsung to produce the light-emitting diode, and the company intends to have everything else made locally.

Locally manufactured components will include circuit boards to be made by MTECH laboratories in Ballston Spa and lighting fixtures to be made by Fonda-based Kasson and Keller, an aluminum extrusion firm considered an important employer in Montgomery County.

“We’re really excited to be putting together an opportunity. The goal is to build them here in New York state and build them with New York parts and New York labor,” Johnston said.

The availability of local suppliers was a priority for the company when it started looking for a site closer to its market, Montgomery County Economic Development Director Ken Rose said.

“They wanted to source locally, and we researched various companies,” Rose said. “If they can source locally, it obviously saves on their bottom line costs, as well. It benefits everybody.”

The county Business Development Center worked with ProTerra on a consolidated funding application through the Mohawk Valley Regional Economic Development Council, and it paid off with a state commitment of $750,000 in economic development funds.

AMSTERDAM LOCALE

Rose said the county’s Business Development Center brought ProTerra representatives to several sites before the former Adirondack Blanket Works facility on Route 30 in the town of Amsterdam caught their eye. The privately-owned building on a 3.1-acre parcel has been vacant for more than a year and holds room for expansion.

The benefits of an LED lighting company that concentrates on warehousing facilities could blossom in Montgomery County since there are several massive warehouses in and around the county, Rose said.

“We’re really excited about the potential of that and getting some of that in our distribution facilities,” he said.

Companies looking to boost their focus on the environment might find massive savings and the notoriety of being “green” that motivates many firms these days, he said. For ProTerra, the environmental benefits of LED lighting are a big selling point.

Johnston said the company has been talking to representatives of the New York City school system — an institution that could likely save millions of dollars in energy costs by making the switch from fluorescent to LED.

The company faces several challenges in marketing its product, including the fact that people are simply used to fluorescent lights.

“It takes a while for people to buy into it. It’s a new technology going up against a 75-year-old industry,” Johnston said.

Foreign companies are also offering LED lighting, and ProTerra’s enhanced LED lighting is more expensive than traditional options, but Johnston doesn’t look at this factor as a major hurdle.

“We know it lasts longer, the quality’s better, the energy savings is better and you pay for that,” he said.

All their parts are expensive because they want to make sure they last, Johnston said.

The company was in discussion with the building’s owner in early January, and Johnston said he was optimistic a deal could be struck before March.