Exclusive: GE to spend another $10 billion on energy research by 2020
By Ernest Scheyder
(Reuters) - General Electric Co plans to intensify research focusing on complex energy projects such as waterless fracking and gas turbine efficiency by earmarking an additional $10 billion through 2020 for its "ecoimagination" budget.
The new spending is set to be announced by Chief Executive Jeff Immelt on Monday.
The research budget shows how reliant GE has become on the energy industry, its fastest growth area, as it works to become a dominant supplier of equipment and services to oil, natural gas and alternative power companies at a time when the United States undergoes an unprecedented energy boom.
While GE doesn't forecast what it plans to spend on its main capital budget in future years, the new commitment gives investors a clue as to what the company's priorities will be into the next decade.
The "ecoimagination" project, which was formed in 2005 to broadly focus on sustainability and other environmental issues and has cost nearly $15 billion, had been set to expire next year. Executives are extending it to 2020 with the additional $10 billion.
While the overall goals of the project will remain, a larger percentage of the funds will go to energy-related projects, an acknowledgment of where Immelt and other executives see the future of the company Thomas Edison founded in 1892.
"We have a very broad, long-standing commitment to energy," said Mark Little, GE's chief technology officer and head of global research.
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