1. 1 Infrastructure and Sustainability: Prospective Effects of Information and Communications Technologies Dr. H. Scott Matthews Carnegie Mellon University

2. 2 ICT Economic Growth OECD Average ICT sector employment 4% –Overall, most from EU/North America ICT sectors grew 50-100% from 1992-97 Total value added 1.2 Trillion USD in 1997 Significant and increasing investment levels

3. 3 ICT and Productivity Productivity: Measure of output as  (K,L) For many years, ICT investments made with no observed macroeconomic effect –Solow (1987): “See effects of ICT revolution everywhere except productivity statistics” Finally, studies see ICT effects –Example: Oliner (2000) suggests that ICT contributed 2/3 of total productivity –Result of cumulative investments but also networked systems (internal and external) Clearly large economic benefits, what are “costs”? –Energy and environmental effects

4. 4 US and Global PC Demand

5. 5 Summary Environmental Impacts Majority of impacts are ‘indirect’ Products have short and decreasing lives Rebound and scale effects are important Use-phase energy may be significant –Estimates of Internet elec use: 1-10% –Sleep and standby mode power is large –EC: 5-15% of all power consumed is standby End-of-life issues are large and increasing –Over 1 billion PCs sold to date in world

6. 6 Workshop Issue In a modern and evolving global economy, how will information and communications technology (ICT) sectors accelerate economic growth, energy and infrastructure dependence, and social welfare? –ICT as a double-edged sword Answer requires a system-wide perspective –Many systems involved: LCA, built and digital infrastructures, social systems

7. 7 Other Important Issues Telework/telecommuting - land use issues –Conflicting evidence about effect of T&T Continued trend towards miniaturization –2000 US sales of laptops up 22%, desktops 1% –PDAs and handheld computers/dematerialisation Communications / network changes –100 million cell phone users in US –Expected change to small ‘cells’ (5 -> 0.01 km 2 ) –Analog->Digital Television Smart Production Systems

8. 8 U.S. Production Effects 1992-97 Does not seem to be getting cleaner across supply chain Computer service ‘consulting’ sector worse in some areas Source: Matthews/OECD (2001)

9. 9 Infrastructure Issues Vast majority of energy consumed by ICT is electricity in buildings (resid + comm) Places burdens on businesses, consumers, and energy policymakers to manage demand ICT has implications on other digital and built infrastructures –Data networks, highways, airspace, logistics –ICT has not ‘replaced’ these, it is ‘overlayed’ –And creates interdependencies between them ICT networks organized like traditional networks

10. 10 Office Building ICT Use Sources: EIA CBECS (1992, 1999), Annual Energy Outlook 2002 [Commercial electricity projected to increase 1.7% per year, commercial ICT 4% per year] Anecdote: roughly 200 sq. ft of total commercial space per person! ICT electricity use in office buildings projected to increase a factor of 10 from 1992 levels, intensity a factor of 8 -> to 2% of all US electricity To reduce burden, further ‘green building’ programs needed to offset projected ICT electricity growth

11. 11 Spillover Effects ICT use goes beyond ‘building’ electricity –Networks decentralized - consume electricity globally –Creating networks depend on rights-of-way, social processes, etc. (as do roads, power lines) –Online purchases stimulate broad activity on logistics infrastructures (e.g. fuel, congestion) Positive spillovers as well (double-edged sword) –Sensing and monitoring of activities –Modeling of data to improve society –Hard to assess value of these

12. 12 Growth of Retail E-commerce ICT has spillover impacts to other sectors –E.g. transportation, logistics management US DOC began measuring and reporting retail e-commerce in March 2000 –4Q 00 = $8.7 Billion, up 67% from 4Q 99 –1% of all retail purchases [note $26B for 2000]

13. 13 Summary Environmental Impacts (per-book basis)

14. 14 Online v. Traditional Retail Consider effects of buying/receiving books via ICT- enabled systems ‘Total energy’ implications? Substitution? Primary difference is in front and back ends –Online ordering and delivery vs. shopping trip –Logistics similar in design, but less efficient –Inventory management efficiencies / returns –Reliance on single-packaged air instead of bulk packaged truck

15. 15 Source: Matthews et al, Transportation Research Record, 2002.

16. 16 Comparison with Japanese book distribution industry estimated 2-5x less energy use to deliver books (geographical and energy differences)

17. 17 Future Policy Issues Pricing Internet use like transport (congestion) –Encouraging growth but also managing Connecting the rest of the world: via wireless? –Most LDCs could be done at low ‘cost’ –Ad-hoc wireless networks vs. telecom giants? If we go wireless - what to do with old wires? –Hard to transfer to LDCs –Supposed to be all fiber by now? 5x-10x more e-commerce (not marginal) –Congestion, costs if more trucks and planes needed Social dispersion (don’t need to live near work)

18. 18 Future ICT Scenarios Demand for data bandwidth and technology –Generally doubles every year (Odlyzko) Wireless: catching up with installed wired speeds –Also: allows deployment in harsh geographies, less-developed countries, new applications –Changing infrastructure needs of ‘cells’ (5 -> 0.01 km 2 ) Optical: currently have optical ‘glut’ –Both overbuilding, wavelength technologies Home networking (Voice-IP, DSL/cable, wireless) Distributed computing (i.e. idle cycle sharing)

19. 19 Conclusions ICT/elec growing rapidly, becoming more pervasive –Growing at a rate much higher than average –High economic value makes it an unlikely target Assessing ICT impacts requires knowledge and management of infrastructures ‘Systems analysis’ paradigm extended to digital infrastructures –LCA and other tools helpful in doing this Infrastructure management increasingly aware of interdependencies