Role of ICT Innovation in Driving Energy Efficiency

1. Role of ICT Innovation inDriving Energy Efficiency Jim Jarrett Vice President, Global Public Policy Intel Corporation JCCT Energy Efficiency Conference July 2007

2. Overview • Intel in China • IT and Sustainability – Technology is the answer for economic and environmental sustainability • The “Micro” and “Macro” energy efficiency stories • “De-Coupling” and “De-Materialization” • Suggestions for Chinese energy efficiency policy

3. Harbin Urumchi Shenyang Beijing Dalian Jinan Xi’an Zhengzhou Nanjing Shanghai Chengdu Chongqing Wuhan Fuzhou Kunming Taiwan Shenzhen Guangzhou Hong Kong Intel in China • The most comprehensive Intel organization outside of the United States • Entered China since 1985 • Invested & committed direct investment: US$3.8 billion • Employees: 7,000 • Branches and representative offices on the mainland: 16 • To build a new 300mm wafer fabrication facility in Dalian

4. IT and Sustainability • There are twin challenges that face China, the US, and the world • Energy security • Climate change • Together, these challenges add up to “sustainability” • The ability to provide for today’s needs without limiting future generations’ ability to meet their needs • Intel and the IT industry taking action to advance sustainability on three levels • Our operations • Our own products (the ‘micro’ story) • Throughout the economy through the energy efficiency role of our products in other sectors (the ‘macro’ story)

5. Reducing Our Operational Footprint • The IT industry is growing and, thus, has a particular responsibility to grow in a sustainable way • Improving manufacturing energy efficiency and sustainability is especially important in a rapidly growing country like China • Intel’s track record: • Reducing PFC emissions by 56 percent since 2000 • Saving over 400 million KWhrs of electricity through efficiency improvements

6. Products – The “Micro” and “Macro” Stories • “Micro” story – The IT industry continues to invent more energy efficient devices • “Macro” story -- IT drives energy efficiency throughout the modern economy, including • Internet commerce • More energy efficient vehicles • “Smart” buildings • More efficient industrial process controls

7. The “Micro” Story --Intel Leadership

8. 2007 • 3.7 TFlops • 1 rack • 53 Servers • 40 sq ft • 21 kW • 2002 • 3.7 TFlops • 25 racks • 512 Servers • 1000 sq ft • 128 kW Moore’s Law … Alive and Well in the Data Center Where would YOU rather be?

9. ROUTER CORE Polaris: Tera-Scale Prototype 80 Cores 1 TFLOP at 62 Watts 256 GB/s bisection 22 mm 13.75 mm

10. Intel/GoogleClimate SaversTM Computing Initiative

11. Climate SaversTM -- Collective Impact by 2010 • Broad participation by IT companies, companies that use large numbers of computers, and consumers • Improve computing energy efficiency by 50% • Collectively save $5.5 billion in energy costs • Reduce global CO2 emissions from computing platforms by 54 million tons per year • Equivalent to removal of 11 million autos through 2011 • Or eliminating 20 coal plants from the planet • Or planting 25,000 sq. miles(~65,000 km2) of trees

12. Sustainability Implications of the “Macro” Story • Dramatic advances in IT have driven recent surge in US economic productivity • “Two thirds of the US gains in productivity from 1997 to 2002 can be directly attributed to the application of information technology…” (ITIF,Digital Prosperity, 2007) • In parallel, IT advances have enabled “de-materialization” • Bits and bytes traveling through the Internet now increasingly take the place of material resources, including energy • Productivity increases have lead to “de-coupling” • Economic growth now can occur much faster than growth in energy demand

13. GDP vs. Other Growth Rates Source: U.S. Department of Energy, Energy Information Administration

14. How “De-Materialization” Works • The bytes and bits traveling through the Internet often replace material-based modes of communication and commerce • On-line newspapers • Ordering books via Amazon vs. driving to bookstore • Tele- and video-conferencing vs. travel • B-to-B supply chain efficiencies • Lawrence Berkeley Labs study quantified potential climate change benefits of de-coupling and de-materialization • Greater Internet use could reduce growth of carbon emissions by 67% over business as usual in 2000-10 • Potential even greater in China due to faster growth and lower IT penetration rates

15. Don’t Let the ‘Micro’ Get in the Way of the ‘Macro’ • US data show that the percent of US electricity demand accounted for by data centers has doubled in the last five years – to 1.5% • The US government is right to want servers and data centers to be more efficient • But, from the ‘macro’ perspective, the growth in data center power demand is a result of the rapid growth of the Internet, which is driving much bigger gains in energy efficiency throughout the economy • Actions to improve the energy efficiency of servers and data centers must not limit their functionality, or these greater EE savings will be lost or limited

16. Suggestions for Chinese Energy Efficiency Policy • Consult with stakeholders • Take advantage of industry technical expertise • Support voluntary initiatives • Harmonize requirements with other jurisdictions, including USEPA Energy Star and EU Energy Using Products Directive • Don’t pick winners • Ensure cost-effectiveness • Enforce through self-declaration • Keep the “macro story” in mind