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September 14, 2009 (FinancialWire) -- Four Ames True Temper locations have entered into energy supply agreements with Orion Energy Systems Inc. (NASDAQ: OESX | Quote | Chart | News | PowerRating) that will create significant energy savings with no upfront costs or capital investment for the non-powered lawn and garden tools manufacturer.
Other companies to recently enter into Orion's Virtual Power Plant negawatt supply agreement include Raynor Manufacturing, Dixon, Ill.; Queensgate Foods, Cincinnati, Ohio; RSVP Direct, Wheeling, Ill.; BorgWarner, Auburn Hills, Mich.; Performance Food Group, Rock Island, Ill.; Gould Paper, Edison, N.J.; and four Alpha Packaging locations. Orion now has commitments to supply over 110 million negawatts to customers of the OVPP. A negawatt is essentially reduced energy consumption generated by Orion's energy-efficient technology.
Orion, of Manitowoc, Wis., is a leading power technology enterprise that designs, manufactures and deploys energy management systems, consisting primarily of high-performance, energy-efficient lighting systems, intelligent wireless controls and direct renewable solar technology for commercial and industrial customers.
The Orion Virtual Power Plant delivers energy savings at a fixed-rate that is less than current utility rates. Given this, Ames True Temper is left with free cash flow every year during the five-year supply agreements. Moreover, Ames True Temper will receive increased savings when the rate caps on PPL, the utility that provides electricity to Ames True Temper, are lifted in Pennsylvania in early 2010, as rates are expected to increase as much as 30 percent.
During the negawatt delivery period, Orion maintains responsibility for the technology, removing the technology risk to Ames True Temper. After all negawatts are delivered, Ames True Temper will take ownership of the technology, and have significant savings annually in light-related energy costs.
In addition to the cost savings, Ames will reduce its energy consumption at the four Pennsylvania locations by 36.5 million kilowatt-hours over the life of the supply agreement. The reduction will prevent more than 24,027 tons of carbon dioxide, 96 tons of sulfur dioxide and 35 tons of nitrogen oxides from being emitted into the atmosphere during the length of the agreement, according to the Environmental Protection Agency.
The greenhouse gas reductions are the air-scrubbing equivalent of a 1,343-acre forest, or removing nearly 1,200 cars from the road. It's also the equivalent of saving more than 3 million gallons of gasoline during the agreement, according to the EPA.
"The Orion Virtual Power Plant will deliver guaranteed energy savings to Ames True Temper, while delivering improved light quality with no risk," said Dan Waibel, president of Orion Asset Management. "The OVPP continues to gain a foothold with companies looking to save money on energy costs without having to use valued CAPEX that could instead be used in the company's core processes, all the while, reducing their carbon footprint."
Gerald Shipley of FMS Energy LLC of Parkersburg, W. Va., played an instrumental role in implementing the OVPP supply agreement and installation of the Orion product at Ames. FMS worked onsite at the Ames facilities and managed the implementation and strategic placement of the product to allow for maximum benefit to the customer.
Shipley's expertise in energy procurement of electric services, natural gas and demand response with energy-saving techniques is unique in the energy industry. The relationships FMS creates with customers allow projects to proceed in an extremely quick, professional and economical manner.
FMS is an all inclusive provider of energy consultation including natural gas, electric and liquid product, and energy conservation services.
"Ames True Temper is setting the standard in energy efficiency -- helping improve our environment one light at a time," Shipley said. "Their reward is better lighting and energy-cost savings, all the while reducing their carbon footprint. Ames also is showing its employees that they are investing in them and the future of Ames.
"And Orion's OVPP allows Ames to realize these benefits without capital expenditure or technological risk."
Companies using Orion's products are an integral part of helping local utilities displace electricity capacity and reduce strain on the electric grid. Orion has deployed its energy management systems in 4,796 facilities across North America. Since 2001, Orion technology has displaced more than 459 megawatts, saving customers more than $642 million and reducing indirect carbon dioxide emissions by 5.5 million tons. Orion's technology was recently internationally recognized with a Platts Global Energy Award for the single most innovative and sustainable green technology of 2008.
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Free annual reports for companies mentioned in the news are available through the Free Annual Reports Service (http://investrend.ar.wilink.com/?level=279).
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