General Electric Co
The largest U.S. conglomerate plans to seek federal stimulus money to fund construction of the factory, near Albany, New York. Initially the factory will make batteries for GE's forthcoming hybrid railroad locomotive.
Battery technology is a core part of the energy future globally. We want to be a part of it, said Jeff Immelt, chief executive of the world's largest maker of jet engines and electricity producing turbines.
We've invested about $150 million so far in this innovation, this technology, Immelt said.
This is the first GE project to seek funding from the Obama administration's two-year, $787 billion economic stimulus program, of which alternative energy is a cornerstone.
Immelt said he hoped GE would seek federal funds for other ventures related to clean energy and healthcare information technology, though he noted that the Fairfield, Connecticut-based company will continue to invest in these areas regardless of government money.
New York State is also providing $15 million in funding for the battery factory.
The federal government has a long-range and long-term interest and investment in clean and renewable energy sources, New York Gov. David Paterson said. The federal government is interested in these types of projects and I am sure will provide assistance financially.
TWO-PRONGED TECH PUSH
The batteries GE will build in the New York plant will use a sodium-metal halide technology that the company believes is well suited to storing large amounts of energy. While initially rolling out to railroad locomotives, GE officials said it could also be used in utility backup systems, emergency power supplies for telecommunications providers and eventually, in a smaller scale, hybrid or plug-in electric cars.
GE's other investments on the battery front include a $55 million stake in A123 Systems Inc, which Detroit automakers General Motors Corp
The move is part of GE's Ecomagination green business push, which it launched in 2005. Last year that venture generated $17 billion of revenue, ranging from sales of products such as electricity-producing wind turbines and high-efficiency jet engines to compact-fluorescent lightbulbs and highly efficient refrigerators.
Immelt said GE expects to generate $20 billion in Ecomagination revenue this year and $25 billion in 2010. He expects battery revenue to hit $500 million by 2015.
The economy clearly gives us headwind, but we still see a fair amount of interest globally for these types of products, Immelt told Reuters in an interview.
GE believes that lithium-ion batteries are better-suited for short bursts of intense power, such as are required to start a vehicle moving, with sodium-metal halide a better option to provide large amounts of power over a long period of time.
Hybrid locomotives, and the battery technology on board, could be an important part of how we ship goods by rail in the future, said Matthew Rose, CEO of No. 2 U.S. railroad Burlington Northern Santa Fe Corp
GE announced the move at its main research center in Niskayuna, New York, 160 miles north of New York City. It expects the plant to open by 2011 and employ 350 people.
(Reporting by Scott Malone; Editing by Brian Moss, Matthew Lewis, Richard Chang)