General Electric (NYSE:GE) reported that revenues from its Ecomagination portfolio of energy efficient and environmentally advantageous products and services surged past $12 billion in 2006, up 20% from 2005, while the order backlog rose to $50 billion.
“These extraordinary revenues and orders are the initial payoff from directly aligning our product portfolio with our customers’ needs and evolving trends, while ‘doubling-down’ on investments in leading edge technology and innovation,” said GE Chairman and CEO Jeff Immelt. “Ecomagination is growing beyond our expectations, evolving into a sales initiative unlike any other I’ve seen in 25 years at GE.”
GE made progress on each of its Ecomagination commitments in 2006:
1) Double its investment in clean research and development: GE invested $900 million in cleaner technology research and development in 2006, drawing closer to its $1.5 billion annual ecomagination R&D target by 2010. GE also increased the number of ecomagination-certified products 50% over the last year – from 30 to 45 products.
2) Increase revenues from ecomagination products: GE reported $12 billion in revenues from ecomagination products and services in 2006, on course to the goal of $20 billion in sales in 2010.
3) Reduce its greenhouse gas (GHG) emissions and improve the energy efficiency of its operations – GE GHG emissions reduced emissions from operations by 4% in 2006 from the 2004 baseline. GHG and energy intensity have been reduced by 21% and 22% respectively compared to 2004. GE is committed to reduce its GHG emissions 1% by 2012, reduce the intensity of its GHG emissions 30% by 2008, and improve energy efficiency 30% by the end of 2012. Roughly 5,000 global projects are under way. Energy cost savings to the Company are roughly $70 million to date.
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In other news, GE Energy Financial Services announced it would double its renewable energy investments by 2010, and that is one of the first financial institutions to disclose the greenhouse gas emissions from its power plant equity investments.
GE Energy Financial Services’ fastest growing business area, headed by Managing Director Kevin Walsh, is its worldwide investing in wind, solar, biomass and geothermal renewable energy.
Those investments have grown from $630 million in 2004 to $2 billion today. The doubled investment target would increase the share of renewable energy assets in GE Energy Financial Services’ overall portfolio to nearly 20%, or $4 billion, by 2010.
It’s also doubling investments in development-stage clean energy, water technology and efficiency companies to $50 million a year.
Among the companies in which it has invested is A123Systems, which is developing advanced technology for rechargeable batteries. GE acted as lead investor in A123’s latest fund-raising, a $40 million series D equity round that closed in January.
GE Energy Financial disclosed that greenhouse gas emissions from its equity investments in power plants total about 10.94 million metric tons. Its current equity portfolio of renewable energy assets will avoid 3.9 million metric tons of carbon dioxide emissions per year.
In another announcement, GE Energy Financial Services and the AES Corporation (NYSE:AES) have entered into a join venture to develop greenhouse gas emission reduction projects in the US.
The venture, first announced in January, seeks to create an annual production volume of 10 million tonnes (metric tons) of greenhouse gas reductions by 2010, primarily through the reduction of emissions of methane – a potent greenhouse gas with a warming potential 21 times greater than carbon dioxide.
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