General Electric, Venture Firms Unveil $200M Investment and Prize Program to Promote Smart Grid Technologies
At a glitz-filled press event in San Francisco’s financial district today, General Electric announced an “innovation challenge” designed to promote smarter, more efficient electric grid technologies. It pledged to invest $200 million in proposals from entrants in three areas—renewable energy, smart grid technologies, and “eco homes/eco buildings”—and said it would collaborate on the program with leading venture capital firms including Zurich- and Toronto-based Emerald Technology Ventures, Menlo Park, CA-based Foundation Capital and Kleiner Perkins Caufield & Byers, and Boston-based RockPort Capital.
“Were doubling down on our commitments and opening up to new ideas,” said Beth Comstock, GE’s chief marketing officer, at the event. “The challenge now is how to move faster…but GE can only do so much. We have to work together to collectively put our imaginations to work.”
The challenge, open to anyone 18 and older, will take place over the next 10 weeks. Entrants can submit their ideas at GE’s Ecomagination website. Competitors will vie both for five $100,000 grants designed to help innovators test early-stage ideas, and for potentially much larger equity-based investments from Fairfield, CT-based GE and its venture collaborators.
According to a press announcement distributed at the event, the $100,000 grants will be handed out by a judging panel including Wired editor Chris Anderson (who also chaired a discussion panel at this morning’s meeting), GE executives, and “leading academics and technologists.” A separate committee of representatives of GE businesses and the venture firms will evaluate candidates for commercial partnerships. Half of the $200 million is coming from GE, and half from the venture firms.
GE has its own venture wing, and wants to be known as a company that innovates, but “we don’t think that we can invent everything ourselves,” said GE CEO Jeff Immelt at the event. The grid challenge fund, which he called “more ambitious” than the X Prizes and other similar challenge-based programs, is designed to stimulate innovation that GE can help bring to market, he said.
“When I look at a market like this I think of speed and solutions,” Immelt said. “Speed means taking products to market and solutions means finding a commonality so that our big industrial partners can buy from one person. We want GE to be a good convener both for innovators and for customers…We can use the industrial clout of GE to bring products to market faster.”
Immelt said he also hopes the fund will accelerate the whole process of smart grid innovation. “We think this is going to open up cleantech investing, particularly in digital energy and the smart grid. The commitment we’re making is that we’re going to be able to use our marketing capability, sales, and brand, and move things quickly and have scale.”
Ray Lane, managing partner at Kleiner Perkins Caufied & Byers, one of the participants in the new GE-led dedicated fund, echoed that sentiment, saying that his main hope for the program is that it will help energy innovators scale up their ideas. “There is no lack of entrepreneurship or technology to bring to bear, but many times our entrepreneurs run into scale issues,” Lane said. “They don’t know how to scale this to the type of complexity [in the U.S.] with 3,300 utilities and another 1,500 independent power producers.” The benefit of the challenge will be in “the marriage with GE’s massive scale with the entrepreneurship we can attract,” Lane said.
GE also used the event this morning to promote other clean technology efforts, including its new WattStation charger for plugin-electric vehicles, which is designed to reduce the time it takes to recharge vehicle batteries. The company also promoted business areas such as wind turbines, water filtration, more efficient jet engines, and nuclear power generation. “I’m as excited about what clean energy can do for this company, this country, and the global economy as I was five years ago,” Immelt said. “We are going to continue to double down on clean energy.”