Solar panels power tubing extruder

Tubing extruder NewAge Industries Inc. really is “new age” — thanks to rooftop solar panels that generate about half of the company's annual electricity needs.

For this Best Practices, we go to Southampton, Pa., outside of Philadelphia. There, NewAge employees are celebrating the fifth anniversary of the company's green energy system, which uses 4,082 solar panels. The panels cover about three-quarters of the roof of the factory. In mid-2011, CEO Ken Baker flipped the switch that turned on the system.

The panels generate one megawatt of electricity each year.

In the 2011 announcement, company officials said it was the sixth-largest rooftop solar panel system in the state of Pennsylvania. The company made it a point to use only U.S.-made components — solar panels, inverters and the racking system.

That's appropriate for a U.S. manufacturer. And it's admirable, since China dominates the solar panel sector.

In many ways, this is a perfect Best Practices story for plastics processors. We're not talking about General Motors Co. here — NewAge is a modest-sized tubing extruder. Today, NewAge employs about 130 people and extrudes plastic and rubber tubing and hose and makes injection molded fittings. According to Plastics News' most recent ranking data, NewAge generates estimated sales of $24.5 million a year.

Company officials estimate the solar panel system will pay for itself in electricity savings in about four more years. That's a payback of around nine years.

“It's a long-term investment,” said Ann Phy, NewAge's marketing coordinator. “There was a lot of thought put into it.”

Total cost of the project was $4.2 million. The solar project was financed by a $1 million solar energy grant from Pennsylvania's Department of Community and Economic Development, another $1.2 million in federal grant money and $2 million from NewAge.

CEO Ken Baker said: “It's very satisfying to say that we make our products using renewable energy.” The company buys additional power from green energy suppliers.

“We're pleased to help the environment, support our community and lower our dependence on fossil fuels,” Baker said.

NewAge has deep roots in the community. It began in 1954 when Ken Baker's father, Raymond Baker, bought a small company that made and imported metal hardness testers. A year or so later, on a business trip to England, he found a product that piqued his interest — a clear, nylon-braid reinforced flexible PVC hose. He started a second business with the new product, called Nylobrade.

The testing instruments business group, now known as Newage Testing Instruments, was sold in 2000 to two longtime managers, and they, in turn, sold to Ametek Inc.

Ken Baker guides the company today. NewAge Industries extrudes hose and tubing from a wide range of materials, including polyurethane, nylon, polyethylene, polypropylene, fluoropolymer, thermoplastic rubber and silicone. The company also makes fittings, clamps and other accessories. Markets include food and beverage, biomedical, chemical and cosmetic industries.

NewAge Industries was “green” even before installing the solar panels. The company had replaced all windows, added screens to dock doors for natural ventilation, upgraded lighting, replaced motors on equipment with energy-efficient versions and properly recycled its e-waste.

But the solar array project was the most ambitious undertaking to date.

And NewAge is not resting. The company recently stopped providing foam plastic cups and asks employees to use washable ceramic mugs provided by the company, or paper drinking cups. Employees also received aluminum water bottles, which they can refill at the company's watercoolers.

Also this year, NewAge is celebrating another anniversary: It's been 10 years since the company initiated an Employee Stock Ownership Plan, or ESOP, in 2006.

Employees like working for a company that is honest-to-goodness “green.” At NewAge Industries, they get to own the company, as well.