Traffic software and solutions provider Traffic Technologies (ASX: TTI) has secured a $15 million contract with the Tasmanian government to switch the state’s 50,000 halogen and fluorescent street lights to LEDs over the next three years.
The contract was awarded by government utility TasNetworks and the changeover is scheduled to commence before year end.
It follows the rollout in July of over 8000 new-generation LED road lights and associated remote control monitoring systems in Victoria under an $8m contract awarded by Downer on behalf of VicRoads in late-2017.
The TasNetworks contract is expected to generate $5m revenue for the company in each 12-month contract period and have a positive impact on company earnings for the second half of 2018.
Carbon emissions source
Street lighting is believed to be the single largest source of carbon emissions from local governments, typically accounting for up to 60% of their total carbon dioxide emissions.
There are around 2.3 million street lights in Australia and to date, approximately 18% have switched to LED technology.
Compared to halogen and fluorescent lighting solutions, LED in general use less power per wattage output, translating to less energy consumption and a reduction in harmful emissions.
Traffic Technologies’ LED street lights utilise energy-saving technology which can result in energy and savings of 75% per year when compared to the cost of traditional lighting.
Managing director Con Liosatos said the contract is a good opportunity to partner with the Tasmanian government in a environment-friendly campaign.
“This contract presents a significant opportunity for [us] to partner with TasNetworks to assist with its replacement program and facilitate the reduction of emissions while significantly reducing annual running costs,” he said.
Healthy order book
The TasNetworks contract is one of many long-term supply projects adding value to Traffic Technologies’ order book and contributing to a 16% increase in its 2018 revenue figures over 2017.
The company has secured multi-year LED road and street supply contracts with major councils and road authorities in Victoria, New South Wales, South Australia and Queensland.
It has also won projects with entities in NSW, Victoria and Queensland for the supply of its Smart City platform which connects street lights and other traffic management equipment on the road to a central control and management system.
The company said the platform has additional future applications including detection of traffic flows, waste management, parking availability and monitoring of government infrastructure.
At midday, shares in Traffic Technologies were trading 8.82% higher at $0.037.