GE decided to get serious about developing smart grid technology around 2005.  “As soon as you put communications across the power grid, huge opportunities emerge,” said Bob Gilligan, head of GE Energy’s Transmission and Distribution unit in 2008.  Gilligan estimated at the time that the annual world market for smart grid technology and supporting software is around $20 billion.

GE has several smart grid projects underway both in the United States and around the world that are in various stages of deployment.  In America, the company is currently involved in Pacific Gas & Electric’s 3.3 million smart meter installation project in California and is also involved in a deal with American Electric Power involving up to 5 million smart meters.

GE announced last year that it will be providing support for EDF Energy Networks’ new power distribution network in London.  GE Energy’s power distribution management software will support the new system which represents EDF’s final phase in the integration strategy that will benefit eight million energy consumers in the area.

Despite the company’s falling stock price the company is still going to double its spending on clean tech R&D this year to $1.5 billion – an amount equal to one-fifth the total amount of capital investment within the entire sector in 2008.

“We can probably improve the efficiency of the grid by 5 percent” said Steve Fludder, vice president of GE’s Ecomagination unit, a group dedicated to developing the smart grid.  Fludder spoke at last week’s Cleantech Forum in San Francisco.  A 5 percent reduction in power usage would be equal to the amount of power used in more than 12 million American homes annually.

“In terms of reducing carbon emissions, it is a big deal,” said Fludder.

Developing the smart grid is a big part of GE’s plans for energy efficiency.  GE’s Ecoimagination products brought in $18 billion in revenue for the company in 2008.  The company hopes to grow that figure beyond $25 billion next year.  The environmental push is certainly welcomed at GE which has seen its stock price dragged down recently because of the conglomerate’s extensive financial positions.

Fludder’s group is also working closely with the company’s appliance group to develop smart appliances.  So far, appliance makers have been hesitant to embed Internet communications technology within devices meant for the home but as smart grid technology becomes more widely available that can utilise the benefits of smart appliances that attitude will change.

Smartmeters.com believes that GE is the company to watch in 2009.