Baldor Electric Company
Baldor Electric (NYSE – BEZ) is an energy efficiency play hidden in plain sight. The Arkansas-based company manufactures electric motors, drives, generators, and related products. As Trillium continues to seek investments that will benefit from an increased worldwide focus on clean energy and energy efficiency, Baldor stands out as a high quality, profitable firm whose products are part of the solution.
According to the U.S. Department of Energy, an estimated 25 percent of electricity is consumed by industrial electric motors in the U.S., making it the single largest end use of electricity. Baldor markets some of its motors explicitly based on the energy savings its customers can derive. As a result of the increasing cost of electricity (up 10.9% from 2004 to 2005) Baldor expects sales of its premium efficient Super-E motors to grow at a faster rate than standard motors. High efficiency motors currently make up less than 20% of sales, but with their higher growth rate Baldor believes that the upside is for these motors to account for 50% of their sales.
Baldor’s focus on manufacturing energy efficient motors has earned the company numerous corporate social responsibility awards. The company ranked 95th in Business Ethics Magazine’s 2006 list of the 100 Best Corporate Citizens. Baldor was also included in B20: The World’s Top Sustainable Business Stocks chosen by SustainableBusiness.com. The company is also committed to maintaining its manufacturing operations in the U.S. for products sold domestically.