It is not without reason that 48-year-old Lorraine Bolsinger perks up at the mere mention of green. The green business of General Electric Co. (GE)—which Bolsinger heads—has seen an year-on-year growth of 20% and clocked revenues of $14 billion (around Rs56,000 crore) in 2007. Its pipeline of total orders till last year stood at $70 billion. As vice-president of ecomagination, Bolsinger manages the entire programme across GE, bringing together marketing, sales, environment, health and safety leaders to meet the goals of cleaner, more efficient sources of energy, reduced emissions and abundant sources of clean water for her customers as well as the firm.
Launched in May 2005 globally, ecomagination began operations in India in February 2007. Among other things, Bolsinger and her team focus on new technology, enterprise selling and promotion. They also closely work with Global Research—GE’s industrial research laboratories unit, which develops long-range technology for all of GE’s businesses—to assess technology projects for commercialization opportunities.
Ecomagination products include eco-friendly aviation and locomotive engines, cleaner coal technologies, efficient gas turbines, sustainable and renewable energy solutions for rural areas, water treatment solutions and technologies for the automotive and industrial sectors.
Bolsinger, who joined GE’s energy business in 1981 after graduating from the University of Pennsylvania with a BS in biomechanical engineering, has experience in power generation, oil and gas, defence and transport industries. In her free time, the mother of two enjoys skiing, tennis, golf, cooking and reading.
Bolsinger recently came to India to attend the Delhi Sustainable Development Summit 2008. On the sidelines of the summit, she spoke to Mint about ecomagination’s India plans and the future of green business. Edited excerpts:
Is green the way for businesses to remain in black in the future?
At GE, we are betting on that. Ecology and economics go hand in hand, and we believe there are no trade-offs for good business and what is good for ecology.
Lorraine Bolsinger, Head, Green Business, GE
As a global leader in energy, technology, manufacturing and infrastructure, GE is uniquely suited to help solve environmental challenges and provide its customers with environment-friendly technologies. Today, we have more than $3 billion invested in renewable energy as part of our efforts to reduce greenhouse gas (GHG) emissions, and we aim to invest $6 billion by 2010. We plan to double the research investment in environment-friendly technologies from $700 million to more than $1.5 billion by 2010. We are also working on reducing GHG emissions and improving energy efficiency, not just for our customers but also for our companies across the group. We plan to cut our GHG emissions 1% by 2012 and bring down the intensity of GHG emissions towards the end of this year by 30%.
As natural resources become scarce, customers will increasingly want to buy energy- and water-efficient solutions. Maintaining leadership in efficient and lower emission technology will be key to companies’ competitiveness and bottom line.
What are the challenges of selling green technology, especially in emerging markets such as India?
The biggest challenge is educating our customers on the life-cycle cost of ownership (cost of a system or product over its entire lifespan) and moving them from making purchase decisions based on landed cost (total cost of a landed shipment, including purchase price, freight, insurance, and other costs) to life-cycle cost. Once they internalize this concept, selling green technology becomes easy. In most cases, green solutions have lower life-cycle cost, even if they may seem a bit expensive upfront. Often, the payback period for green technology is less than two years. The decision of Air India is a great example, where they will be saving around 15% over the existing engines due to better fuel efficiency of GE90-115B engines for the Boeing 777-300ERs and the GEnx engines for the Boeing 787-800 aircraft.
What role does communication play in green marketing?
Communication plays a key role in marketing and advertising green products. It is an important way to increase awareness among all stakeholders. Having said that, unlike other product categories, green communication has to be transparent, reliable and verifiable, given the various political and regulatory complexities and the presence of interest groups, including environmentalists, not-for-profit organizations, investors and consumers.
Therefore, green communication requires a more sophisticated, integrated communications strategy. Unlike in the case of consumer products, greenwashing is a strict no-no. Often, a third party validation is required to bring in the much-needed credibility.
Where does the Asia-Pacific region stand in terms of awareness compared with other geographies?
We see customers in every region taking the issues of climate change, water scarcity, energy security and costs associated with these very seriously. In some cases, this is the result of new or anticipated regulation, and in other cases, in preparation for markets that will desire more environmentally conscious products—and they wish to stay competitive in their global markets.
GE is starting to see heightened interest and investment in the Middle East (West Asia). Australia has set some new goals, including energy efficiency targets. Japan and Korea both are addressing the issues not only as climate-related, but also as issues of national energy policy and security. China has talked about a road map for Green GDP, and has made some long-term infrastructure investments in line with this thinking, such as the most efficient and clean locomotives and airplanes using the most efficient engine technology.
We see lots of opportunity in India as well. India has recently instituted a new incentive programme for solar energy. Also, renewable purchase standards coupled with accelerated depreciation facility are driving the strong growth of wind energy in India. GE has just announced a new wind turbine manufacturing unit in India which will supply our highly efficient product to meet local demand.
Which are the sectors or industries that have shown a clear lead in terms of reducing carbon footprint and using energy efficiently at the same time?
With respect to sectors or industry segments, we have seen progress across the board. Energy efficiency projects are the easiest to implement and have the quickest returns, usually less than two years. We see major energy efficiency initiatives in the retail, commercial and industrial sectors. Most of our customers tell us that they are motivated by lower costs, customer demand and corporate reputation.
Within our own operations, we have lowered our carbon footprint by 200,000 tonnes, and reduced energy use, resulting in savings of $100 million last year. We see record investments in renewable energy technologies, such as wind power and engines burning biogas. And across all industries, we see new consideration of the cost of water use, not just input costs but also discharge costs. So these trends are across the board.
What are ecomagination’s India plans?
As India continues on its path to economic prosperity, its growth puts further burden on the country’s environment and natural resources. The more companies consume nature’s vital and valuable resources for temporary gain, the harder it gets to combat the consequences of the resultant phenomenon. There is thus a critical and pressing need for innovative, sustainable and eco-friendly solutions.
As advanced, eco-friendly technologies are becoming a priority in India, companies are increasingly embracing the latest in clean and green technologies, including the most advanced eco-friendly aviation and locomotive engines, energy turbines and water treatment solutions.
India is a very important market for ecomagination. We are targeting over $1 billion per year in revenues from ecomagination products in India by 2010. We expect (GE) revenues of $8 billion by 2010 in India from the current revenues of nearly $2 billion. GE has planned investments of up to $150 million in “eco-related” research and development funds at its Technology Center in Bangalore over the next five years.
Ecomagination projects in India include a rural electrification programme in partnership with Malavalli Power Plant Pvt. Ltd, where we are providing 30 Jenbacher JMS320 engines that will be used to generate combined heat and power to meet electrical, refrigeration and heating needs within rural communities; a solar-powered freshwater purification system for tsunami-affected villages in southern India; and a green building project with the Haryana Technology Park.