Google and its Web 2.0 brethren are young enough to have always had green on their minds. But what about the hulking electronics makers of yesteryear? What will it take for them to green their offerings with the rest of the market? Today, LG Electronics came up with its own number: a whopping $18 billion.
That’s the sum the Korean company plans to spend on greening its operations over the next decade, with goals to slash greenhouse gas emissions by 40 percent and jump start product lines consistent with energy efficiency and renewable energy trends.
The announcement comes mere months after LG had the Energy Star label embarrassingly stripped off its refrigerators. An audit turned up that the fridges consumed about twice the power that LG said they did — a major faux pas, but just one of several that the Energy Star program has caught while sharpening its teeth under the watchful eye of Energy Secretary Steven Chu.
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At first, LG didn’t take the news all that well, filing suit against the U.S. Department of Energy claiming that it had switched the test it used to qualify appliances for Energy Star. But now it appears the company has decided the green tide is too strong to swim against.
The earmarked $18 billion will be used to fund development of ultra-energy-efficient appliances, including televisions, air conditioners, refrigerators, and more. LG says it plans for 10 percent of its revenue to come from sales of energy-efficient products. It will also be dialing up its solar manufacturing targets and begin selling fuel cells and electric car batteries — bringing itself into competition with Panasonic, Siemens, Hitachi and Samsung.
These rivals have also been rolling out expensive green initiatives. Sony is trying to corner the efficient electronics market while simultaneously achieving carbon neutrality by 2050 — an ambitious feat that Fast Company guesses will cost much more than $18 billion.
LG’s announcement today is yet another sign that the advanced battery market will become a battleground in the next several years. Major corporations are racing to produce batteries that last longer, produce less waste and sell cheaper than the rest. Hitachi announced just last week that it has lithium-ion battery technology in the works that could last more than a decade. And Panasonic says it has an energy storage system that could power a home for a week.
Where does this leave the smaller players without billions at their disposal — like recent IPO A123Systems? Probably high and dry. The same could be said for solar cell makers struggling to scale, not to mention fuel cell innovators like ClearEdge Power and even Bloom Energy.
The green sector is poised for a clash of the titans, but most of the casualties will be venture-backed startups.