NCS Power, Inc. may have a difficult time meeting its goal of creating 290 full-time jobs in Clark County by 2012.

When the Vancouver-based firm was awarded a $2.5 million stimulus loan by the Washington state Department of Commerce last October, it announced plans to hire 50 workers by Jan. 1 in order to start assembling a line of Light Emitting Diode (LED) bulbs and fixtures at the Port of Camas-Washougal.

Four months have since passed and the company’s plans are moving slower than expected as it waits for a check from the U.S. Department of Energy, said CEO Bart Adams.

NCS now estimates it will start filling those jobs this summer.

“We’re all waiting for them to sign a contract to provide lights and have sales,” said Jack Hardy, a spokesman for the Port of Camas-Washougal. “The expectation is to lease a facility and bring up to 250 jobs.”

The Vancouver engineering firm specializing in power supply design has raised $2 million in private investment to reinvent itself as an LED company, Adams said. But that seed money, combined with the federal loan, will sustain it only through the research and development phase. The company needs another $5 million to really scale up manufacturing, he said.

Several more obstacles remain for the 10-person company to reach the point where it can sign a lease with the port, start hiring engineers and assembly workers, and build its customer base. And skeptics within the LED industry aren’t sure it can be done in such a short time with such minimal resources.

“The vertical integration that needs to be involved with manufacturing this product would take millions and millions to do everything in the U.S.,” said Terry Grover, founder and former owner of Duraguard Products, a Vancouver company that manufactures commercial-industrial lighting fixtures. “The largest producer in North America of roadway (LED) lighting is General Electric Co. and they employ approximately 300 employees.”

Reinventing the LED

NCS Power has established its business in power management, designing high-performance batteries for a variety of applications. And the company still earns the majority of its revenue through power management contracts with companies such as Insitu Inc., a Boeing subsidiary based in Bingen that uses batteries designed by NCS to power some of its military drones.

But designing batteries isn’t very profitable, Adams said.

And so over the past year, NCS has overhauled its business strategy to focus on designing more efficient power management strips for high-efficiency LED lighting.

LED technology is already well-developed and tested by big players such as GE, Phillips and Cree. But the market isn’t yet fully established and there’s still room for improvements that narrow the technology’s price premium and improve its performance, said Eric Virey, an LED industry consultant and founder of MT-squared Strategies in Portland.

“Leveraging on their power management experience, they might be able to bring something to the picture because power management of the LED is actually a little tricky,” said Virey.

Keeping only its best-paying contracts, NCS cut half of its engineering staff and six months ago hired Adams to lead the transition. The company has designed what it says are higher-quality, longer-lasting LED replacement bulbs for streetlights and office buildings that they plan to sell to municipal governments, schools and large commercial and industrial building owners interested in cutting energy and maintenance costs.

Cities interested

NCS has already won strong support among the cities of Vancouver, Battle Ground, Camas and Washougal, which are enthusiastic about the company’s products and want to see them succeed.

“From everything I’ve heard about them, it’s an excellent product,” said Michael Piper, sustainability coordinator for the city of Vancouver, which consulted with the Bonneville Power Administration in evaluating NCS bulbs. “I’m really excited about the technology.”

NCS is in the running, along with several other contractors, to supply the LED replacement bulbs in all four cities’ energy-efficiency pilot projects. Battle Ground, Camas and Washougal in November were each awarded $135,000 in stimulus grants to replace streetlights, traffic lights, fluorescent office bulbs and vehicle beacons with LED bulbs, but haven’t yet chosen contractors to supply the lights. The city of Vancouver this month also was awarded a $1.6 million stimulus grant to improve energy efficiency that includes installing LED streetlights.

“Our hope is this will take off because LED technology really does save money and power,” said Jim Dunn, assistant director of public works for the city of Washougal. “With a successful pilot program, (NCS) will be able to have possible investors look at that and want to purchase their product.”

Dunn and Piper both acknowledged that NCS isn’t yet ready to meet the city’s testing and certification requirements for streetlights. But the cities also have two years to spend their grant money and the company very well could be ready by the time the contract goes out to bid, they say.

“If they’re in production by then and meet all the testing requirements, we’ll certainly consider them,” said Piper. “Especially since they’re local and homegrown.”

The contracts would be critical for NCS to succeed in its early stage growth, Adams said.

Once it can build enough demand for its products, NCS plans to hire engineers to assemble its own patent-pending LED power supply and buy the remaining components from other companies, including circuit boards and LED lights made by chipmakers such as WaferTech and Linear Technology.

They also plan to hire factory workers to assemble the bulbs, sliding the power supply and strips of LED lights into 2- to 4-foot long plastic tubes to create replacement bulbs for existing fluorescent light fixtures.

In the meantime, the company’s prototype bulbs are being manufactured and assembled in China.

“We need to scale up but we need to do it with revenue, that’s the only way a company will last,” said Adams. “I don’t want to rely on government largesse.”

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