Navy Pays $7.7 Million for LEDs

SOLON, Ohio — The U.S. Navy has ordered $7.7 million worth of LED lighting from Solon-based Energy Focus. It’s the single largest delivery order the energy company has received in its 28-year history.

Shares of Energy Focus Inc. soared 42 percent on Sept. 11 after the company announced the sales details, according to The Street. The Navy placed the order for Energy Focus’ Intellitube LED retrofit tubes, which are expected to be delivered throughout the remainder of 2014. Energy Focus calls the LED lamps a “plug and play technology” that allows for direct fit into existing fluorescent sockets with or without the ballast in place. The LED lamp is already installed in more than 140 naval vessels, a jump from fewer than 20 at the beginning of 2014.

“Over the past year, we have built extensive relationships with the U.S. Navy at various levels from the Pentagon to the ship forces, which now are broadly aware of the economic and sustainability benefits of our LED technologies, as well as the availability of our LED products,” said Eric Hilliard, president and chief operating officer of Energy Focus, in a statement. “We are extremely excited about and grateful for the unwavering commitment to energy and maintenance savings, as well as carbon reductions made by the leadership in the U.S. Navy. We are equally committed to working with and supporting all constituencies from the Navy to expedite their LED adoption initiatives in the quarters and years to come.”

Energy Focus has been working with the Navy since 2006 to develop an LED system that would replace outdated lighting on ships. The switch is expected to save more than $150 million and 3 percent in fuel costs per year, according to Energy Focus.

“Energy Focus products have now been installed on more than half of the ships & subs of the active U.S. fleet,” said Dave Bina, Energy Focus business development manager, maritime and navy business, in a statement. “Based on the standard budgets for each ship class, full conversion to our LED products should be complete in next five years.”

The Navy has turned to energy efficiency to deal with severe funding cuts and rising fuel costs. The Department of the Navy Secretary Ray Mabus promised that by 2020 the department will produce 50 percent of its energy from alternative sources. In 2012, President Obama announced that the Navy will purchase enough energy capacity to power 250,000 homes. To that end, the Navy chartered the 1 Gigawatt Task Force that will deliver and oversee the goal.

“We are absolutely honored with the confidence the U.S. Navy has placed in Energy Focus and our LED products,” said James Tu, executive chairman and CEO of Energy Focus, in a statement. “With over three decades of advanced lighting development experience and a long-term research partnership with the U.S. government in LED lighting since 2002, Energy Focus remains the only Navy Military-Spec qualified LED replacement lamp provider. We are also proud to say there has been zero failure in the lamps we have put on U.S. Navy ships since our first installation in 2007. We plan and fully expect to leverage our proven technologies and the resounding successes we have had with the U.S. Navy to build our presence and leadership in the broader maritime market, including military and non-military vessels that together represent a total addressable market of over $4 billion.”