RailPower Technologies Corp., the Vancouver-based company that makes hybrid “Green Goat” locomotives for switching yards, has announced a supply and licensing agreement with Ocean Tug & Barge Engineering Corp., or OTB

So what’s the big deal? Well, Milford, Mass-based OTB — which is considered a world leader in barge and tugboat design — wants to supply RailPower’s hybrid power systems to tug and barge operating companies, as well as tug and towboat builders or any shipyard that makes workboats.

This is an interesting, though not unexpected, development. You may recall an article I wrote in the Toronto Star back in July where I quoted MacMurray Whale of Sprott Securities — in my view the best analyst covering this sector — hinting at this evolution of RailPower’s technology:

MacMurray Whale, an alternative energy analyst with Sprott Securities in Toronto, said even if wind and solar power are left out of the equation, the shipping and ocean transport industry could benefit significantly from hybrid-electric designs, not unlike technology in the Toyota Prius or hybrid locomotive technology from Vancouver-based RailPower Inc.

He said tugboats, ferries and even cranes used in shipping-container ports are all candidates for hybrid technology, because their stop-start work cycles allow energy to be recaptured and stored in batteries. “Container ports, in general, have a lot of intermittent devices with intermittent duty cycles,” said Whale.

Apparently, the folks at Railpower and OTB have come to the same conclusion. OTB’s president Bob Hill made the opportunity clear in a press release: “The operation benefits of reduced fuel consumption and maintenance costs of RailPower’s core technology, we believe, will be replicated in marine operations.”

Press releases usually have short, pithy quotes from the main parties to sum up the significance of an announcement, but in the press release put out today Hill goes out of his way to gush about RailPower’s technology:

“A tug is very much a water-borne switcher with similar work profiles that can greatly benefit from RailPower’s hybrid technology. Fuel and maintenance savings are, of course, a major incentive for vessel operators where high fuel usage is standard; however, increasingly port operators are looking for ways to substantially reduce emissions from marine activities. In addition, an assortment of workboat types, from river switchboats, to research vessels, to small passenger vessels, can benefit greatly from this type of drive system. The retrofit possibilities can also be attractive to owners, allowing them to both save fuel and meet Tier II and III requirements on existing vessels. This all results in it being a very opportune time for the technology.”

Hill’s quote speaks for itself. This licensing agreement opens up a whole new world of opportunity for RailPower, one that makes incredible sense. Makes one wonder when a major player like General Electric will scoop up RailPower as the industry begins to consolidate.