Panasonic to Invest $1 Billion in Green Tech

Panasonic's residential fuel cell technology extracts the hydrogen, saves the energy to generate electricity that actually powers the home's electric grid. Photo: Amanda Wills,

Panasonic was our winner for most standout company at CES in Las Vegas, so we were naturally excited about getting to sit down with Peter Fannon, vice president of government and corporate affairs, at Greener Gadgets last week in New York City.

While some media outlets criticized Panasonic after CES, we were actually intrigued by its end-of-life solutions for electronics and its future investments in green technology.

“Our commitment first and foremost is to do something that makes practical sense and that people can afford,” Fannon said. “But it also has to be sustainable, and we’ve had a long-standing commitment of living in harmony with society since the beginnings of our company 92 years ago.”

Fannon echoed an overall theme that we saw at Greener Gadgets: Simplicity is key. The smaller, more manageable you can make a product, the easier it will be to dispose of down the line. Panasonic has started implementing in-features (features that are included in the product during manufacturing) that make electronics easier to recycle, minimize costs and essentially reduce the overall footprint during production.

But while electronics recycling can be expensive for manufacturers, Panasonic, along with Sharp and Toshiba, believe there should be an industry-wide disposal standard. In support of that notion, the three companies have teamed up to create the Manufacturers Recycling Management company (MRM), which provides recycling services to more than 30 other manufacturers.

While adhering to local and state disposal requirements, MRM is also a cost-effective resource for both manufacturers and smaller volunteer organizations. The program currently has 400 drop-off locations and projects to grow that number to 600 by the end of the fiscal year.

Despite a down economy, Panasonic will spend $1 billion on sustainable innovations over the next three years. These major expenditures include widespread recycling programs and renewable energy, which Fannon said will add inherent value to the company overall.

So, does this mean that sizable investments in the “green” economy will be the ultimate solution to pulling the country out of the current recession? Fannon said it’s unlikely, but it definitely plays a major role.

“To tell you the truth, I think President Obama has it right: Things will take time to turn around and making substantial changes always takes time,” he said. “And it isn’t just the issues about overcoming entrenched interests that people tend to focus on in the extreme situations; it has to do with an observable, practical leap forward that makes sense for the long run. If you don’t make your work worthwhile, you’re just back in the same economic hole. So it’s a combination, and we can’t let up on any front. It’s both developing new sources and exploiting what’s available now.”

With its $4.6 billion purchase of Sanyo last year, Panasonic has now acquired considerable strength in the renewable energy field. Fannon said consumers can expect to see a big emphasis on the U.S.’s Smart Grid system.

“Our goal is to ensure that multiple standards can practically inter-operate because one solution does not serve all, and we feel strongly that there needs to be multiple pass for communication to and from the home, devices that work on different standards that make more sense in other situations,” Fannon said. “Whether it’s wireless or power-line based, WiFi or even Bluetooth, all of these things can mesh together into a truly smart grid, manageable by the consumer […] It’s a big opportunity for companies like Panasonic, but it’s an even bigger opportunity for countries like the U.S. to make the most powerful and significant energy advancement before the ability of renewables to come online in great size and scope.”

Panasonic’s residential fuel cell technology fits into this Smart Grid backing. The technology uses natural gas to generate electricity and heat. To store all the energy you’re generating at home, Panasonic also offers a battery module comprised of 840 lithium-ion batteries. Because it’s a hefty upfront cost (about $30,000), Fannon said government subsidies will be key to getting this type of technology off the ground in the U.S.

“The investment will require about 50 percent subsidy in order to justify the costs, otherwise the companies and residents would not be able to recoup the investment and justify costs,” Fannon explained. “But I am sure we will get there. I am absolutely positive we will get there, which is why Panasonic will continually invest in these technologies.”

For Panasonic, these stakes are a part of its overarching goal: to become the No. 1 green innovation company in the electronics industry.

“The important thing for companies like ours, which spend billions a year on design, is to find the next best thing, but it still has to be the next practical thing,” Fannon said. “Just because you made an investment in one period, doesn’t mean you can’t and won’t focus on the next best thing. Sometimes it is just serendipity, and you trip across it. Other times, it just comes from incredible hard work.”

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