If you pay an electric bill in New York, you fund the New York State Energy Research and Development Authority, more commonly known as NYSERDA.
That agency boasts a $650 million annual budget, and uses some of that money to subsidize businesses it hopes will help the state economy.
Earlier this week, that mission took that form of a $250,000 grant to Power Drives, Inc., a South Buffalo manufacturer with a promising new product.
So how will this project help the economy? Not by creating any new jobs, it turns out.
Gaining momentum
Power Drives makes a product that’s designed to solve a persistent problem for rail roads. In the winter, locomotives are left running continually, even while idling, to keep their works from freezing. This burns fuel, increases wear on engines, increases pollution and costs train companies extra dough.
So Power Drives, Inc. created Powerhouse, a locomotive warming system that’s about as big as a run-of-the-mill generator. The system clicks on automatically during the cold months, when a train is stopped, and starts to heat and circulate radiator fluid.
The grant from NYSERDA will pay for a 14-month “demonstration project” to help Powerhouse gain traction in the global marketplace. A handful of freight companies will be allowed to use the machines with the idea this will create a favorable impression.
But no new positions will be created, and the warming systems also won’t be assembled locally. Power Drives is headquartered in Buffalo and has plants in Jamestown and Erie, Pa., as well as a factory in China. It employs around 170 people around the country, but the money from NYSERDA will be focused on raising awareness.
“We’ll use that for marketing our project going forward. We’ve done a great job developing the product, testing the product, building the product, we really now we need to hit our stride on the sales side,” says Lou Panzica, CEO of Power Drives, Inc.
Without NYSERDA’s grant, CEO Frances Murray says Power Drives would face a tougher uphill climb to gaining sales momentum. The grant is an example of how the government can help small businesses be more competitive in the global marketplace, says Murray.
“The most progressive governmental policies - and we have many of them in New York State - the most brilliant academic idea will not create one new job unless we’re able to attract investment from the private sector,” he says.
