The smart grid partnership between search engine giant Google (s GOOG) and conglomerate GE (s GE) could deliver a lot more than public policy changes and compelling discussion forums. Steve Fludder, VP of GE’s Ecomagination division, told us yesterday in an interview that the partnership could also result in a commercial product.
Fludder says GE and Google are working on “a couple of platforms” and exploring “how to take these concepts and ultimately turn them into a commercial proposition.” He tells us that the product could be a service that GE offers to utilities to help them manage the flow of information flow, or it could also be a web-based service consumers use to manage their home energy consumption. Fludder says the companies are discussing how to integrate GE’s smart meter tools and Google’s PowerMeter, the web-based tool that Google has been developing to manage home energy use via smart meters.
The concepts are all just discussions right now, Fludder tells us: “We’re not ready to announce anything but what we did announce is that we were going to go in a room and try to figure out how we could leverage the strengths from GE and Google.” But it makes sense for the two companies to use the partnership to deliver an energy product — GE is one of the larger smart meter makers and Google has its own history of managing the world’s information.
Yet selling a GE/Google energy product would also further align GE with Google, who many in the energy industry see as an interloper that is focused on market disruption. Some smart meter makers and utilities are wary of Google’s strong pronouncements that energy data should be open, controlled by the customer, and free and easy to access. A Google/GE product could put GE in a tricky situation when its trying to work with less progressive utilities that don’t necessarily want customers to control their own energy data.
However, Fludder says GE agrees with the energy information requirements that Google has touted, and he says for a truly smart grid to work, the energy industry needs regulatory, technological and cultural changes. On the regulatory front, decoupling — the policy that separates a utilities’ revenues from profits and incentivizes energy conservation — needs to happen, Fludder says. Once that happens, utilities can embrace an open architecture that would empower people to take control of their energy usage and deliver a truly smart grid, says Fludder.
Open architecture is a concept that is routinely bandied about in Silicon Valley, but the energy industry hasn’t been quick to embrace it, so it’s surprising that GE, with its long history in the energy industry and its numerous divisions, has landed squarely on the same page as Google when it comes to the future of the smart grid. Fludder even sounds like an exec schooled in information technology: “This is directly analogous to phones and other types of computing systems. At the end of the day open architecture wins and provides scale, which ultimately drives down cost.” That sounds like a direct quote from Google’s CEO Eric Schmidt.