‘Green’ Portfolio Keeps Siemens on Growth Path

by | Jun 28, 2010

Peter Loscher, CEO of Siemens AG told The Peninsula in an interview that the company targets global megatrends including climate change, which will transform environmental technologies. Already, energy-efficient solutions are generating 25 percent of the company’s total revenue, he said.

Here are some highlights from the interview.

Shifting demographics and increasing urbanization are two other megatrends Siemens is targeting as residents in huge cities need clean air, good water and reliable electricity.

Loscher says the global economy is showing increased signs of stabilization, but he still expects a challenging business environment in 2010. However, despite the current economic crisis, the company increased its revenue by 11 percent year over year thanks to its environmental solutions.

In June last year, Siemens announced orders of around $21 billion in the next three fiscal years (2010 to 2012), which will be generated by global government stimulus programs. Green technologies are expected to account for 40 percent or approximately $8 billion of this total.

Siemens’ environmental portfolio includes the world’s most energy efficient gas turbine, state-of-the-art air and water cleaning and desalination technologies, according to Loscher. The company also is a global leader in offshore wind farms and steam turbines for solar thermal power plants.

The gas turbine, which Siemens invested €500m (approximately $616 million) to develop, has successfully been tested at Siemens’ utility customer E.ON. Loscher says once the gas turbine has been integrated into a combined-cycle plant, its output will increase to more than 570 megawatts and be capable of providing electricity for about 3.2 million people. The combined-cycle plant is expected to have an efficiency of more than 60 percent, a world record, according to Loscher.

Mobility is also part of Siemens’ “green” portfolio. As an example cited by Loscher, the Siemens Metro in Oslo, Norway, uses around 30 percent less energy than the previous trains and 95 percent of the Metro’s components are recyclable. He also notes that hybrid buses equipped with Siemens technology in London reduce CO2 emissions by 30 percent compared to conventional buses.

One of Siemens’ most recent green announcements includes a collaboration with a petroleum research group to develop an operational scale petro membrane biological reactor (MBR) unit to treat refinery wastewater. This type of system claims reductions in energy cost by 30-40 percent over conventional MBR processes.

More companies believe sustainability is an emerging megatrend. As an example, Esty Environmental Partners (EEP) together with IBM and 12 other companies just launched an initiative aimed at developing new management tools and models for environmental management and corporate sustainability.

Dow Corning announced last year that it was shifting its focus to more research and development for solutions tied to global megatrends including energy efficiency, alternative energy, clean water and rapid urbanization.

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