Canadian Press (CP) News Bulletin

Monday, November 26, 2001

The U.S. Navy took delivery last week of several dozen low power marker lights designed and built by a Victoria company, to protect its warships both in port and in hostile waters. After the attack on the USS Cole in Yemen, the navy started looking for ways to create restricted no-traffic zones around its warships. What the American Navy came up with is a series of booms around the ships carrying marker lights to illuminate the area and clearly mark the area as off-limits.

The technology used for solar powered buoy marker lights has been around for 20 years. It was most often a series of car batteries hooked up to a solar panel and an incandescent bulb. The Victoria company, Carmanah Technologies, came up with something dirrerent. It has integrated energy efficient Light Emitting Diodes (LEDs) with small solar panels and small batteries. That means the applications and installations have gone from being quite large and expensive to operate, to quite small and affordable. The recent sale of marker lights to the U.S. Navy is an example of how portable and cost-effective the technology has become.

The booms that are being put around warships in the Middle East are meant to cordon off a no-traffic area and make it very clear that the space is restricted. The floating booms can't carry a thousand pound weight so they need a very light-weight and water-tight enclosed light.

The technology is only being producted by three manufacturers around the world. Carmanah has both U.S. and Canadian patents on their design, giving them exclusivity for the models that were sought by the U.S. Navy for installations in Virginia and Washington state. They may expand the use, and several harbours are using the lights now for similar purposes, including New York harbour where heightened security has been in place since the terrorist attacks of September 11th.

The competitive landscape is almost vacant and the technology to employ LEDs has only been around for the last four years, giving Carmanah a huge leg-up in the sale of portable, water-proof lighting.

The three mile nautical light being used by the U.S. Navy and the U.S. Coast Guard was built to specifications set out by the Coast Guard. Art Aylesworth, president of Carmanah, says, "the Coast Guard and therefore the Navy are incredibly demanding. Their specifications are very well defined and the products that you make for those people have to be tested and we've been through quite a bit of rigorous environmental and performance testing to satisfy them."

Carmanah has sold a handful of units to the Canadian Navy but Canada is not building the same sort of security around its warships. Aylesworth says they haven't focused much energy in the way of sales or marketing on the Canadian Navy but they do hope to spend more time on that over the next six to eight months.

Aylesworth says there's not nearly the perceived need for protction in Canada as there is in the U.S. As well, the equipment base is not the same and Canada doesn't have nearly as many ships to protect.

"I think there is certainly a change in the world that has created a desire for more protections,&quot says Aylesworth. He says it coincides with the evolution of Carmanah and his company has finished research and development on enough models to be ready to fill the need.

The initial concept came from the simple need for an anchor light on sailboats. When sailboats are at anchor at night they are supposed to have a mast light on. The problem was that it would draw down the batteries, creating a risk that there would not be enough power in the morning to turn on the auxiliary engines and get the boat moving again.

The sale to the U.S. Navy was not for a large mount of money but is important to the company's future. Aylesworth says coast guards are a very large market and being accepted by them and the U.S. Navy will lead to a lot of business in the future. It also further establishes Carmanah's reputation. According to Aylesworth, there will be significant growth in non-marine applications. "The applications for our products in highway transportation are hundreds of times larger than marine, so we've got a lot of energy going into that now."

The fact Caramanah is a relatively small operation centered in Victoria isn't a concern. Aylesworth says they've gone from about a dozen employees, mostly engineers, to a staff of 34 including sales and marketing. There aren't any international boundaries for the product and global communication allows Carmanah to stay and grow in Victoria while dealing through 80 distributors in over 120 countries around the world.

Carmanah is a public company with annual sales of 3.5 million dollars. Aylesworth says with this and similar deals, they expect to be up around the 20 million dollar mark in annual sales within a couple of years. Early work on Carmanah's solar light products began in late 1994 but the company was not officially incorporated and selling the technology until just three years ago.

(CP)