October 5, 2018 Read More →

Investors push new CEO of GE to back renewables, storage

Washington Examiner:

A group of environmentally focused investors and hedge fund managers is prodding General Electric’s new CEO Lawrence Culp to stave off further losses to the company’s earnings by shifting the manufacturing giant’s focus toward wind and solar energy.

“As GE’s new CEO, you must make many difficult decisions,” reads a letter sent Friday to Culp from the 14 investors and hedge fund managers. “One of your most critical should also be one of the simplest: Will GE continue fighting to protect decelerating fossil fuel businesses or lead the world into a more profitable and sustainable future?”

Culp was hired by GE’s board after the company was hit by major losses in earnings that led to its prior CEO, John Flannery, being fired. GE revealed this week that it suffered a $23 billion loss from its power plant manufacturing segment, which the letter says stems from a poor investment decision that favored fossil fuels.

The letter blames GE’s losses on Flannery’s “misguided preoccupation” with turbines for natural gas and coal-fired power plants that “are rapidly becoming uncompetitive.” Other market watchers say the company was simply out competed by other turbine businesses such as the the German company Siemens.

The investors want to turn around GE’s losses by focusing the company on its successful wind turbine business that earned $9 billion in revenue last year. They also say there is a $150 billion market opportunity for GE in solar.

“GE also has deep technical expertise in energy storage and batteries, which could place the company at the center of the electric vehicle transition,” the investors continued. “This transition will require hundreds of billions of dollars in investment and generate decades of revenues for manufacturers.”

The letter to Culp was signed by more than a dozen investors and hedge fund managers that invest in companies with an environmental and clean energy focus. Some signatories on the letter included Stuart Kinnersly, managing partner with Affirmative Investment Management; Cole Frates, founder of the Renewable Resources Group; Elizabeth McGeveren, the McKnight Foundation’s director of investment; and Frohman Anderson, managing director of Everwatch Financial, among others.

More: Green investors pressure GE’s new CEO to refocus company on renewables

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