GE’s new Current division warms up to Boston’s clean-tech community
To many in Boston’s clean-tech community, General Electric’s launch of its new energy division, Current, here is just as important as the decision to move its corporate headquarters to the city.
This region is already home to one of the densest clusters of clean-energy innovators in the world. But the local industry essentially lacks a true anchor company, a household name that can act as a powerful magnet to attract others in the field.
With Current, GE’s goal is to combine its energy services for corporate and municipal clients into one group, using high-tech solutions to help those customers rein in their electric bills.
Local clean-energy insiders say that’s exactly the kind of initiative that could help make GE the superstar player they have been seeking. More engineers might stick around Boston after they graduate from school. Small companies could see more opportunities to team up with GE, now that Current is in the same area code. Perhaps most importantly, the arrival of Current could elevate Boston’s brand in the industry, particularly with GE’s corporate headquarters on the way as well.
“I think it will draw more people here for energy,” said Sean Becker, a former GE employee who left in 2009 to start Sparkplug Power, an electricity storage firm based in Somerville’s Greentown Labs. “Most people, when they think of energy, they think of Houston. . . . People don’t understand how deep the [energy] economy here is in Boston.”
The buzz started in October when GE unveiled plans to launch Current in the Boston area, assembling pieces of various existing business lines — such as LED lighting, energy storage, electric-car charging, and solar power — under one corporate umbrella. Current employees aim to use GE software to connect clients’ devices through what’s known as the “Industrial Internet.”
“They’re putting all these pieces together, recognizing [that] to do that requires systems and software expertise, business-to-business expertise,” said Peter Rothstein, president of the Northeast Clean Energy Council, whose group already includes GE as a member. “Those are some of the things that are really strong in Boston.”
Maryrose Sylvester, who was previously in charge of GE’s lighting business in the Cleveland area, is running the new group, which will consist of a mix of new hires and people who already worked at GE. It starts with about $1 billion in annual revenue and 1,000 employees.
With GE’s decision last month to shift its corporate headquarters from Fairfield, Conn., to Boston, the pieces of Current’s plans here started to fall into place. Last week, Sylvester opened a 4,000-square-foot space in the WeWork co-working office near South Station. She has already hired about 20 people for the Boston headquarters, and as many as 40 could be there later this year.
Current is later expected to move to the company’s temporary headquarters on Farnsworth Street, probably after its six-month lease at WeWork expires. It will also eventually make the move to GE’s permanent headquarters. The company hasn’t yet picked a location, although the focus is on the South Boston waterfront.
All told, Current plans to directly employ at least 200 people in Boston. They will work alongside another 600 GE employees.
Sylvester wants to grow the division’s revenue from $1 billion to $5 billion by 2020. These numbers represent a small part of GE’s corporate structure — with its 350,000-plus employees worldwide and $130 billion in annual revenue. But they would still make Current one of the biggest clean-tech businesses based in the Boston area.
Sylvester, though, wants the Current squad to think like a startup, as her team figures out the best ways that GE can use its software to help clients control their energy bills.
“We’re trying to run like an entrepreneurial team with the backing of GE but with some of the freedom to try new things,” Sylvester said.
Here’s one way being born within a big conglomerate helps: the ability to launch with some major clients already in hand. Current is just a few months old, and its customer roster already includes the likes of Walgreens, Simon Property Group, Hilton Worldwide, and JPMorgan Chase.
“One of the hardest parts of being a startup is customer acquisition,” Sylvester said. “But we sort of have that with our GE history and connections.”
The company once built its future around the light bulb — revolutionary back in Thomas Edison’s day, but a common household item today. Now, we’re talking about street lights that can warn of upcoming traffic jams, direct drivers to open parking spaces, or report the location of gunshots to law enforcement agencies.
Much of Current’s focus, though, will be on reducing clients’ monthly electric bills. The goal seems simple enough. But electricity is integral to every company’s operations, something that can’t be put at risk. For that reason, Current could have an edge over younger startups without established track records.
“One of the most significant uncertainties around any new company is, will it be here in three years or five years or 10 years? That’s not a question for GE,” said Phil Giudice, chief executive of Cambridge energy storage firm Ambri. “It gives the world of conservative energy customers a whole lot of comfort.”
Boston-area entrepreneur Eric Graham is among those looking forward to GE’s arrival. His firm, CrowdComfort, uses crowdsourcing to improve building efficiencies and has already landed GE as a client. Having the Current and corporate offices nearby will make it much easier for his firm and others in the field to engage with GE.
Stephen Pike, the interim chief executive of the quasipublic Massachusetts Clean Energy Center, said GE’s new offices in Boston mean that the local energy sector could finally have a marquee player to call its own.
“I liken it to Kevin Garnett coming to Boston [in 2007],” Pike said. “The Celtics had some pretty good pieces in place, and I think Massachusetts does as well. . . . What we’re really in need of, and what GE can provide, is the Kevin Garnett, the key piece bringing the whole picture together.”