Last year, Article 13 highlighted the launch of General Electric’s “Ecomagination” initiative. In May 2006, GE published a report on progress on the initiative called “Taking on Big Challenges”. Ecomagination is a highly innovative strategy, driving growth for the engineering and technology giant through anticipating and meeting demand for energy efficiency and climate friendly products.
After only 12 months, GE report that Ecomagination is responsible for turnover of more than US$10 billion. This is up from up from $6.2 billion for the same areas of business in 2004 and GE have orders of $17 billion on the books. This is an even stronger performance than the company had expected in setting the programme’s targets, to achieve $20 billion in annual sales of Ecomagination products by 2010.
Since 2002 the company's wind energy business, acquired from Enron, has quadrupled in revenue. Its fuel-efficient jet and locomotive engines and natural gas turbines are becoming essential to customers in search of ways to reduce their greenhouse gas emissions. Since 2003, GE has sold over US$1 billion worth of wind and natural gas turbines to China.
GE made the following progress on each of its Ecomagination commitments in 2005:
1. Double its investment in clean research and development (to $1.5 billion annual R&D by 2010). GE invested $700 million in cleaner technologies in 2005, well on the way to reach its target. GE also increased the number of Ecomagination-certified products by more than 75% over the last year from 17 to 30 products. Examples of eco-technologies in its R&D pipeline include photovoltaics, biofuels, transport initiatives producing lower emissions and higher fuel efficiency standards, and an offshore wind turbine project with the US Department of Energy.
2. Increase revenues from Ecomagination products. GE reported $10 billion in revenues from Ecomagination products and services in 2005 and it is expecting to reach $20 billion in annual sales in 2010. The report contains a revenue map featuring key sales around the world.
3. Reduce its greenhouse gas (GHG) emissions and improve the energy efficiency of its operations. GE is committed to reduce its GHG emissions by 1% by 2012, at the same time as increasing production and revenues. It is also committed to reduce the intensity of its GHG emissions 30% by 2008, and improve energy efficiency 30% by the end of 2012. GHG emissions from operations remained flat in 2005 compared to 2004, while GHG intensity reduced by 10% and energy intensity reduced by 11%. In 2004 and 2005, GE undertook nearly 500 global energy conservation projects that resulted in more than 250,000 tons of GHG emissions reductions, the equivalent of removing nearly 50,000 cars from the road.
4. Keep the public informed. In addition to its report, GE updates the public via its Ecomagination website, advertising and engagement strategies. ‘Taking on big Challenges’ is available online, and in a nicely innovative touch, to encourage readers to save paper and read the report online, GE will plant a tree at its Ohio jet engine testing facility for each of the first 2,500 downloads, to help offset the generation of carbon dioxide associated with growth at the factory.
It will be worth watching for the future annual reports on how Ecomagination fares, as it will be a bellwether for how GE fares. "With oil prices and other energy costs surging and with water scarcity concerns spreading, Ecomagination makes even more sense for our investors today than it did a year ago”, says the Chief Executive.
Sources:
"Taking on Big Challenges", GE 2005 Ecomagination
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