Lockheed Martin has developed and sold energy technology for years but never made a concentrated push into that market, until now.
The defense giant announced the other day the consolidation of its various energy businesses into a new entity called Lockheed Martin Energy, one that aims to take advantage of sweeping changes in energy, particularly in electric power.
“For decades, we have been investing in smart, natural and safe energy technologies,” Frank Armijo, the newly appointed vice president of Lockheed Martin Energy, said in a statement from the Bethesda, Md.-based corporation.
“With our broad energy capabilities now under a single organization, we’ll focus our business growth strategy, enhance collaboration, advance new technology – and ultimately build Lockheed Martin Energy into a true leader in the expanding energy market.”
Lockheed is hardly the only defense contractor with a hand in energy technologies. Among others, Raytheon Company designs systems to manage electric power and Boeing tests fuel-cell energy storage to meet both military and commercial needs.
But a heightened commitment to energy by the world’s biggest defense contractor is a powerful demonstration of the growing commercial potential of energy markets around the world.
That said, Lockheed Martin Energy represents a “relatively modest” piece of a corporation whose aerospace, defense and security products brought in the bulk of its $46 billion in revenue in 2015, Armijo acknowledged in an interview.
“But in terms of most businesses in this marketplace, we’re not small,” he said. “Now that we’re a consolidated business within Lockheed Martin, we’re going to take advantage of our engineers and scientists and energy professionals working together to meet the needs of utilities, independent power producers, commercial and industrial customers, and government entities.”
In all, Lockheed Martin Energy employs nearly 1,000 people around the world.
Lockheed won’t say how much money it’s made on those types of activities in recent years, when they were managed separately, nor will it do so now under the new arrangement.
Armijo said the energy enterprise, based in Grand Prairie, Texas, is off to a good start this year, with more than $150 million in new business in three months.
“The timing was right in terms of what we see going on in this industry,” he said. “We had enough success within the individual components of the energy business, and Marillyn (Hewson, the president, chairman and CEO of Lockheed) decided the time was perfect to make this happen.”
Lockheed Martin Energy’s largest business provides systems and expertise to help manage the transmission, distribution and use of energy by utilities, businesses and governments around the world.
Eight of the 10 largest utilities in the U.S. are customers of Lockheed Martin Energy, and the Empire State Building and Rockefeller Center in New York are among its big property clients.
The market for such services is growing rapidly with the spread of intermittent sources of electric generation, like solar and wind power, not to mention the proliferation of devices, vehicles, buildings and other items embedded with software and sensors that collect and exchange data on energy use – the so-called Internet of Things.
Energy storage is another primary focus for Lockheed, with the corporation having purchased an MIT spinoff, Sun Catalytix, two years ago to develop batteries for grid- and commercial-scale storage.
Other components of the Lockheed Martin Energy portfolio are projects in Germany and Scotland that are testing new technologies for producing electricity from organic waste and ocean currents.
“Lockheed Martin is known as an engineering technology company, and in reality, the energy challenge is an engineering challenge,” Armijo said. “We happen to believe we have some of the best engineers and technologists in the world. Now, we have a segment of them focused on the energy challenge.”
Bill Loveless — @bill_loveless on Twitter — is a veteran energy journalist and television commentator in Washington. He is a former host of the TV program Platts Energy Week.
