THE U.S. HIGHTECH INDUSTRY AND ELECTRICITY DEMAND

1
THE U.S. HIGH-TECH INDUSTRY ANDELECTRICITY
DEMAND
AeA (American Electronics Association) Electronic
Industries Alliance (EIA) Information Technology
Industry Council (ITI)
High-Tech Energy Working Group
2
OUR OBJECTIVES

• Clarify the role of high tech in U.S. electricity
  demand picture
• Highlight potential of our products as part of
  energy solution
• Understand Administration perspective, scope of
  pending report
• Explore next steps

3
OVERVIEW

• U.S. high-tech industry drives job creation and
  economic growth
• Electricity used in high-tech manufacturing
• High-tech companies committed to energy
  conservation
• Electricity used by high-tech products
• The Internet potential
• Backup data

4
THE U.S. HIGH-TECH INDUSTRY DRIVES JOB CREATION
AND ECONOMIC GROWTH

• High-tech employment -- comprising producers of
  technology products and services -- totaled 5.3
  million in 2000 (4.8 of the total U.S. private
  sector workforce). Source AeA Cyberstates 2001
• High tech contributed 50 percent of the
  acceleration in U.S. productivity growth in the
  second half of the 1990s. Source DOC, Digital
  Economy 2000
• Falling prices of high-tech goods and services
  have reduced overall U.S. inflation by an average
  of 0.5 percentage points a year (from 1994 to
  1998). Source DOC, Digital Economy 2000

High Tech information technology manufacturing,
software and computer-related services, and
communication services
5
THE U.S. HIGH-TECH INDUSTRY DRIVES JOB CREATION
AND ECONOMIC GROWTH -- EFFICIENTLY

• High-tech employment represents 10.6 percent of
  the U.S. manufacturing workforce in 2000.
  Source AeA Cyberstates 2001
• High tech accounted for only 4.7 percent of all
  electricity purchased by U.S. manufacturing
  industries in 1999. Source AeA Annual Survey
  of Manufacturers.
• High tech helps create a highly efficient
  economy Information technology improves
  communications between suppliers and customers,
  facilitating U.S. manufacturers efforts to sell
  products and reduce inventory. Source DOC,
  Digital Economy 2000

6
Total manufacturing 829,000,000 kWh
Source AeA Annual Survey of Manufacturers
7
HIGH-TECH COMPANIES COMMITTEDTO REDUCING ENERGY
DEMAND FURTHER

• Intel has set a 2001 corporate objective to
  reduce its energy consumption by 10 percent this
  year.
• Agilent Technologies is budgeting 20 million for
  projects aimed at significantly reducing its
  energy consumption with the expectation that
  these efforts will reduce energy consumption by
  15 percent.
• Hewlett Packards energy conservation efforts
  have helped it cut five kilowatt-hours off its
  energy usage at its Cupertino campus every year
  since 1991, despite having increased the size of
  the facility by 300,000 square feet. Source
  Silicon Valley Manufacturing Group

8
HIGH-TECH COMPANIES COMMITTED TO REDUCING ENERGY
DEMAND FURTHER (cont.)

• Over the last 10 years, IBM has conserved an
  estimated 8.2 billion kilowatt hours of
  electricity and, as a result, avoided
  approximately 5.66 million tons of carbon dioxide
  emissions, while saving about 518 million in
  expenses.
• Sun Microsystems commitment to energy
  conservation has resulted in a 37 reduction in
  energy use at one facility and use of more energy
  efficient photocopiers saved 220,000kw nationwide
  during 1999. Source Silicon Valley Manufacturing
  Group

9
1 megawatt can power 1,000 homes 3.62 trillion
kilowatt hours powered the U.S. in 1998
Source Lawrence Berkeley National Labs NOVA,
PBSonline
10
ELECTRICITY USED BY HIGH-TECH PRODUCTS

• High-tech products are NOT major component of
  national electricity demand
• Lawrence Berkeley National Labs (LBNL) has
  analyzed high-tech energy demand and concluded
• Office and network equipment comprise only 2
  percent of U.S. electricity
• Including telecommunications equipment and energy
  to produce office equipment, demand share rises
  to only 3 percent
• Analysis based on bottom up effort using best
  measured data
• Source Lawrence Berkeley National Lab
  (LBNL)

11
POPULAR MYTHS

• Media attention for previous analysis by Greening
  Earth Society (GES) (Western Fuels Association)
  reached a different conclusion
• Internet-related share of national electricity
  demand was 8 percent in 1998
• Total electricity demand by all computers and
  office equipment was 13 percent in 1998
• Growth to 50 percent within 20 years
• GES analysis was based on inaccurate data and
  assumptions (see back up slide)

12
MYTH FACT

• 1. The Internet was responsible for 8
• percent of all electricity use in 1998
• 2. The entire digital economy
• (including office, telecommunications, and
  network equipment) accounted for 13 percent (98)
• 3. Each Cisco router uses 1,000 watts
• 4. PC plus monitor uses 1,000 watts
• Source Mark Mills, The Internet Begins With
  Coal

• 1. This statistic is exaggerated by a
• factor of 8
• 2. It is actually about 3 percent.
• 3. Actual use is about 100 watts of power
• 4. PC plus monitor in use 100-120
• watts of electricity and dips to 20-25 watts or
  less in energy-saving mode
• Source Lawrence Berkeley National Labs (LBNL)

13
AVERAGE ELECTRICITY USAGE PER HOUSEHOLD
Source EIA, A Look at Residential Energy
Consumption, 1997
14
Source EPA Energy Star Hewlett-Packard Company
15
THE INTERNET POTENTIAL

• The Internet enables energy efficiency gains of
  two basic types
• Structural gains
• achieved when growth shifts to sectors of the
  economy that are not particularly
  energy-intensive such as the high-tech industry
  and away from sectors such as chemical
  manufacturing, pulp or paper manufacturing, and
  construction, which are energy-intensive
• Efficiency gains
• achieved when businesses change their activities
  reducing energy use relative to their output of
  goods and services
• Source Center for Energy Climate
  Solutions

16
THE INTERNET POTENTIAL -- STRUCTURAL GAINS

• Structural gains could include
• Reduction of, or elimination of the need for,
  office space. By 2007, B2C and B2B e-commerce
  together could avoid the need for 1.5 billion
  square feet of retail space and up to 1 billion
  square feet of warehouse space.
• Energy savings just from the operations and
  maintenance of these "un-buildings" could total
  53 billion kilowatt hours per year, about 13
  percent of total electricity growth projected
  under business-as-usual scenarios.
• Source Center for Energy Climate
  Solutions

17
THE INTERNET POTENTIAL -- EFFICIENCY GAINS

• Efficiency gains could include
• The use of the Internet to purchase goods.
  Internet shopping uses less energy to get a
  package to a house Shipping 10 pounds of
  packages by overnight air - the most
  energy-intensive delivery - uses 40 percent less
  fuel than driving roundtrip to the mall. Shipping
  by truck saves 90 percent.
• Source Center for Energy Climate
  Solutions

18
MACRO TRENDS VALIDATEENERGY EFFICIENCY ROLE OF
INTERNET

• Rise of Internet has coincided with a decrease
  rather than an increase in energy intensiveness
  of economy
• Comparing pre-Internet era (1992-6) to Internet
  era (1996-2000)
• GDP growth rate increased by nearly 50 percent,
  while
• Electricity demand growth rates actually declined
• If Internet was a significant energy hog, you
  would expect to see accelerated electricity
  demand growth rates, not the decline the data
  actually show
• Source Center for Energy Climate Solutions

19
GDP vs. OTHER GROWTH RATES
Source U.S. Department of Energy, Energy
Information Administration
20

• THE FOLLOWING PAGES
• CONTAIN BACKUP DATA

21
TECHNOLOGY SUCCESS STORIES

• Intel has developed the "Instantly Available PC"
  (IAPC) power management chip technology that
  enables PCs to meet the new Energy Star standard
  of 15 watts sleep-state power consumption.
• PCs with IAPC consume 63 less energy per year
  than non-power managed PCs, driving an energy
  savings of over 10 billion in the US alone over
  the next 10 years.
• This energy savings also reduces the pollution
  associated with generating electricity,
  equivalent to taking nearly 22 million cars off
  the road.

22
TECHNOLOGY SUCCESS STORIES (cont.)

• AMD flash memory semiconductors, found in a
  variety of appliances, equipment and vehicles,
  consume very low amounts of power, e.g. 0.002
  0.036 watts, and these devices consume so little
  current in standby (0.0000002 amperes) that most
  test equipment cannot measure it.
• AMDs microprocessor families support the Energy
  Star computer specification of 15 W watts
  sleep-state power consumption. AMD has also
  developed PowerNow!, a combination of software
  and hardware, which allows set top boxes to
  reduce power consumption up to 74.

23
TECHNOLOGY SUCCESS STORIES (cont.)

• All of Sun Microsystems desktop products are
  Energy Star compliant. Suns Sun Ray 1 appliance
  requires less than 20 watts while the traditional
  unit requires as much as 100 watts. Source
  Electronics Industry Alliance, International
  Cooperative for Environmental Leadership, World
• Resources Institute, Taking a Byte Out of Carbon
  
• Canon has developed a new "on demand" fixer
  technology for photocopiers that reduces energy
  consumption to 1/4th of the conventional level,
  while dramatically reducing warm-up times.
• Ricohs Aficio1035 copier, launched in 2001, use
  one-ninth of the power of the Ricoh DS5330,
  launched in 1994 (34Wh/h/ 297Wh/h 1/9 ).

24
TECHNOLOGY SUCCESS STORIES (cont.)

• IBM's revamped eServer z900 provides significant
  energy cost and space advantages over traditional
  server arrangements.
• Kodaks Digital Video Camera, the DVC323, allows
  customers to shoot still pictures or motion video
  even to have a live teleconference using home
  or office computers, which substitutes energy
  intensive travel with remote interaction.
• From 1994 to 1997, the computing speed of IBMs
  AS/400 Model 9406 computer has increased six
  times while its power consumption in 1997 is only
  one-fifth of that in 1994.

Source Electronics Industry Alliance,
International Cooperative for Environmental
Leadership, World Resources Institute, Taking a
Byte Out of Carbon
25
TECHNOLOGY SUCCESS STORIES (cont.)

• Panasonics technologies include electronic toll
  collection systems that automatically bill
  drivers for road tolls via an exchange of signals
  between car-mounted and toll-station equipment,
  thereby improving fuel efficiency. Source
  Electronics Industry Alliance, International
  Cooperative for Environmental Leadership, World
  Resources Institute, Taking a Byte Out of Carbon
• With approximately one third of the stock of
  copiers now Energy Star compliant, it is
  estimated the current savings of the Energy Star
  copier program to be 570 GWh/year. Source
  Lawrence Berkeley National Labs, "It's
  Midnight...Is Your Copier On? Energy Star Copier
  Performance

26
EXAMPLES OF ERRORS IN GREENING EARTH SOCIETY
(GES) STUDY

• Units GES
  Actual Ratio
  estimate estimate
  GES/
• Actual
• Power used by phone
• company central offices kW 500
  55 9.1
• Power used by mainframe computers cooling
  kW 250 19.2 13.0
• Active power used by a typical PC
  monitor W 1000 150 6.7
• Typical routers on the Internet W 1000
  30 3.3
• Typical routers on LANS and WANS W 1000
  50 20.0
• Electricity used to manufacture a PC kWh 1500
  300 5.0
• Source Lawrence Berkeley National Labs
  (LBNL)

27
LOWEST STATE ELECTRICTY USAGE PER PERSON, 1998
RANKED

• Rank State Electricity Usage Per person
  (MWh)
• 47 New Hampshire 7.8
• 48 Hawaii 7.8
• 49 New York 7.2
• 50 Rhode Island 7.0

51 California 6.9
Source AeA Energy Information Administration,
State Electricity Profiles, 2000