EU Commission Outline is a Positive Action Plan for Much-Needed Border-Neutral Carbon Reduction

GE (NYSE: GE) endorses the European Union Commission’s Communication on Financing Low-Carbon Technologies, the company announced. Smart grid technologies will be used in an E.U.-wide smart city strategy that will see smart meters deployed in homes, together with technology to optimize renewable generation and accommodate plug-in electric vehicles.

“Now is the optimum time to plan how we will deliver smarter, cleaner and more efficient electricity,” said Ricardo Cordoba, president of GE Energy for Western Europe and North Africa. “A smarter grid is a proven path to ensure the integration of renewable and distributed generation, to increase the efficiency of energy delivery, to empower consumers to manage energy use and reduce bills.”

GE believes, however, that the European Union’s Strategic Energy Technology (SET) Plan’s recommendation for a significant increase in research and testing should be reexamined. GE and other technology companies have already tested, proven and stand ready to deploy many of the technologies that will help design and optimize a smart grid. The company stated it is time to act.

In order to implement the large-scale rollout needed, European Union members must agree on how to fund the multi-billion Euro investment. The smart grid’s significant job creation and economic opportunities across the European Union should provide incentive for the governments to act.

The SET communication correctly identifies the need for European Union-wide investment models and legislation that encourage network operators to adopt carbon-smart solutions. Regulators need to examine examples tried elsewhere in the world to determine and clarify how network operators will be rewarded for smart grid related capital expenditure (capex). Currently, capex is spent on primary assets that earn regulated revenue over the entire assets’ lifetime and the network operators have invested accordingly. GE believes new operating and investment models require new regulation models.

“GE stands ready to help with technology investments, expertise and strategies for smarter energy distribution and consumption,” said Cordoba. “With experience from similar projects in the United States, such as energy smart Miami, GE can deliver the efficiency, reliability and innovation needed to introduce new grid-reliant technologies such as electric vehicles, energy storage, electric heat pumps and renewable (wind energy, solar power) or micro-generation.”

GE also recommends a more aggressive move to smart grid. With already-proven technologies, it is potentially possible to best the commission’s goals of having 25 to 30 cities and half the European Union operating on the smart grid by 2020.

GE is a diversified global infrastructure, finance and media company that’s built to meet essential world needs. From energy, water, transportation and health to access to money and information, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide.

GE serves the energy sector by developing and deploying technology that helps make efficient use of natural resources. With 60,000 global employees and 2008 revenues of $38.6 billion, GE Energy is one of the world’s leading suppliers of power generation and energy delivery technologies. The businesses that comprise GE Energy – GE Power & Water, GE Energy Services and GE Oil & Gas – work together to provide integrated product and service solutions in all areas of the energy industry including coal, oil, natural gas and nuclear energy; renewable resources such as water, wind power, solar and biogas; and other alternative fuels.