BOSTON (Reuters) - Surging oil prices have captured the attention of consumers and leaders around the globe, but General Electric Co is already on to what it thinks will be the world's next big worry -- water.
The company said on Wednesday it aims to cut its water usage 20 percent by 2012, a move that should reduce its annual operating costs by $15 million to $20 million.
"There is going to be a price on water that is going to reflect its scarcity, and today it doesn't," Lorraine Bolsinger, vice president of GE's Ecomagination green-business push, said in a phone interview. "We're going to see that change over time, certainly in the emerging markets."
With businesses ranging from manufacturing jet engines to commercial lending, GE has made green business a major thrust for the past three years. Last year it generated revenue of $14 billion -- 8 percent of its total -- through the Ecomagination program, representing sales of products ranging from compact fluorescent light bulbs to electricity-producing wind turbines.
The Fairfield, Connecticut-based conglomerate, the second-largest U.S. company by market capitalization, forecasts that Ecomagination sales will hit $25 billion by 2010, far higher than the $10 billion target it set for that year back in 2005.
It also has cut its annual emissions of greenhouse gases by 8 percent from 2004 levels and trimmed costs by about $100 million by looking for ways to use energy more efficiently -- no small matter when when oil has been notching new highs above $130 a barrel.
GE is not the first major corporation to look to water efficiency.
Coca-Cola Co last year announced plans to reduce the amount of water it uses to produce its beverages. The world's largest soft drink company this year plans to set a specific target for improving efficiency, a spokeswoman said, noting that since 2003 the company has reduced the amount of water it takes to produce its drinks by 18.6 percent.
Jeff Immelt, GE's chairman and chief executive, said in a statement, "We will use our broad portfolio to reduce water consumption, ensure long-term supplies and increase operational returns at GE facilities around the world." Immelt was due to unveil the initiative in Beijing on Wednesday.
ENOUGH FOR 400,000 AMERICANS
In 2006 GE used 10 billion U.S. gallons (37.85 billion liters) of water, enough to meet the annual needs of 400,000 Americans. To meet its goal of cutting that figure by 20 percent, the company has started a review of how its 100 largest facilities in the United States, Europe and China use water, to look for ways to reduce waste.
Some of the savings could come in areas where GE has found ways to use less energy, Bolsinger explained.
"Have there been improvements along the line where you don't need as much cooling, for example, as you used to need? If anything gets more efficient, then you have less heat rejection and need less cooling," she said. "We may just be pouring water through a process that's not even needed."
Beyond cutting back its own water use, GE is working on ways to help other companies cut their consumption. For example, it is developing a program that would allow distilleries and food-handling facilities to extract organic material from their wastewater, convert the material to electricity, and run the resulting clean water through industrial processes again, rather than releasing it as waste.
"The interesting reach for this product is in China and India, in rural areas that would love to have industrialization, poverty alleviation and all the good things that come with it, but they don't have enough electricity or a reliable grid and they don't have enough water," Bolsinger said. "Here's a great opportunity to have both, and to make it sustainable."
(Editing by John Wallace)