General Electric and Google have announced that they will collaborate to develop smart-grid technologies with a particular focus on plug-in hybrid vehicles and enhanced, "hot rock" geothermal systems.

Smart-grid technology lets utilities more efficiently manage electricity on the grid while smart meters and displays in homes and businesses allow consumers better understand and control home energy use.

The deal combines each company’s strengths: GE will make the hardware — from turbines to metering switches, and Google will make the software.

For example, electric cars will require more power generation capacity, which GE will provide, and the intelligence needed by the grid to tap the electricity stored in charged car batteries when they’re parked at night would come from Google.

In the geothermal area, Google will create visualization software while GE will work on power conversion technology. Google recently invested in a number of enhanced geothermal projects, while GE does not yet have a large investment this area.

GE, however, does have a large investment in wind energy, expecting revenues of more than $7 billion from wind power this year. Google will work on software to manage the grid so that power generated from wind, wherever it may be blowing at a particular time, will be available where it is most needed.