Why do oil & gas companies and electric utilities try to slow down the adoption of green technologies? - Michael Silverstein
Why do oil & gas companies and electric utilities try to slow down the adoption of green technologies? – Michael Silverstein
I’m always surprised that so many oil & gas companies and electric utilities try to slow down the adoption of green technologies. Why fight the inevitable? Why not position yourself to profit from it instead?
I’ve now concluded that the big problem here is a robotic adherence to company business models. Oil companies, though, were not always adverse to expanding (not replacing) these business models.
Take the case of Standard Oil Of New Jersey (now Exxon). At the turn of the last century it was drilling and refining oil into gasoline. But this gasoline was generally sold at pumps outside general merchandise stores. Then in 1908 it opened the country’s first gas station whose main business was selling gasoline. And ever since then most gas stations around the world have been owned by oil companies.
So why not learn from this example? Why should oil & gas companies not get into a green technology as a profitable sideline?
Take frackers for example. They drill holes in the ground to reach natural gas deposits. And when you go down as little as a few feet you begin to encounter the never changing and uniform heat of the earth. Why not collect his heat and use it to power electrical generators? You could then start selling electricity as a sideline to your basic business model. A la Standard Oil of New Jersey in 1908.
In states around the country electric utilities are trying to prevent use of solar panels because in the companies’ present business model these panels are competitors. But they need not be seen that way.
Just get into the solar panel business as a sideline. As very large companies, you can get a great deal on big purchases. You also have a lot built in customers — your present grid customers. You don’t have to change your basic business model. Just expanded it.
Good corporate management evolves with the times. Oil & gas drillers and electric utilities need to see opportunities and tie into them. For their shareholders. For the country. For the natural environment on which everyone depends.
Michael Silverstein, is a former senior editor with Bloomberg News and currently contributes to the Planet Philadelphia radio show.
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