GE has announced it will integrate its renewables, grid, and energy storage assets into a simplified, single business that nearly doubles the size of its Renewable Energy division, as the company banks on the accelerated uptake of grid-connected renewables worldwide.
The expansion will see GE’s grid solutions, solar solutions, and storage businesses move from GE Power to GE Renewable Energy. The company also said it will regionalize its onshore wind business to simplify and make that business more “local.”
The company’s freshest business reshuffle was announced a day before GE is expected to report its earnings for the fourth quarter of 2018. The industrial conglomerate has suffered a series of financial ups and downs over the past year, owing in part to weaknesses in the power segment.
A Mass Consolidation
The company—long a formidable leader in the gas turbine business—has been struggling since its $10.6 billion acquisition of Alstom’s Power and Grid business in 2015. Last November, GE announced the reorganization of its Power division into two businesses, forming GE Gas Power, comprised of Gas Power Systems and Power Services, and GE Power Portfolio, comprised of the Steam, Grid Solutions, Nuclear, and Power Conversion businesses. In a December interview with POWER, newly appointed GE Gas Power CEO Scott Strazik acknowledged that renewable energy will continue to grow “exponentially,” but he also offered optimism about the growth of the company’s natural gas business.
GE Renewable Energy CEO Jerome Pecresse, who created Alstom’s Renewable Power business—a division that had close to 10,000 employees when it was absorbed into GE—told reporters in a Jan. 30 call that the renewables and grid consolidation would create a $16 billion business with 40,000 employees. GE’s Renewable Energy division now employs about 23,000 workers, he said. As of the end of 2017, GE had a total 313,000 employees, about 83,500 of which were affiliated with the Power division.
It will mean that GE Renewable Energy, which has so far housed the company’s onshore wind, offshore wind, LM Wind Power, and hydro offerings, will now also oversee its grid solutions and hybrid renewables technologies, which were previously part of the Power division. That will leave GE Power’s portfolio with the steam, nuclear, and power conversion businesses. A GE spokesperson told POWER that GE does not plan to dispose of any businesses as a result of this announcement.