General Electric Company said on Monday it plans to stop making new coal-fired power plants, as the U.S. industrial conglomerate focuses more on renewable sources of power generation.GE said it would continue to invest in in its core renewable energy and power generation businesses, but added that getting out of the new build coal market would likely include site closings, job cuts and other “appropriate considerations for publicly held subsidiaries.
“With the continued transformation of GE, we are focused on power generation businesses that have attractive economics and a growth trajectory,” said Ge’s senior vice president and CEO of GE Power Russell Stokes.
“As we pursue this exit from the new build coal power market, we will continue to support our customers, helping them to keep their existing plants running in a cost-effective and efficient way with best-in-class technology and service expertise.”
GE’s announcement also makes it the last major company to dump coal, and is a dramatic reversal for the struggling company, according to CNN Business.
Just five years ago, GE acquired Alstom’s power business, which makes coal-fueled turbines.
The $9.5 billion deal was the largest industrial purchase GE had ever made, and it proved to be disastrous because coal was already on its last legs due to the rise of natural gas and a shift toward solar, wind, and renewable energy.
GE ended up laying off thousands of workers, slashed its dividend to a penny, fired two CEOs and has sharply written down the value of its power business. And while it may seem to be cuttingits ties to coal, GE will continue to service existing coal-fired power plants as well as build turbines for nuclear power plants.
What General Electric is doing with this latest move is making a huge bet on offshore wind energy, as shown by the creation of the Haliade-X, the world’s largest and most powerful offshore wind turbine.
Built by GE Renewable Energy,
the Haliade-X, turbine is 220 meters (approximately 722 feet) high, nearly 300 feet taller than the London Eye. The blades are over 100 meters (approximately 328 feet) long and will have the ability to power 16,000 homes each.
In pre-market trading after Monday’s announcement, GE shares fell to $6.63 and by 10 a.m. EDT were at $6.42.