1. How green is your valley? How much impact could it have? Extract from McKinsey & Company independent analysis for the Climate Group SMART 2020 report July 2008 CONFIDENTIAL This report is solely for the use of client personnel. No part of it may be circulated, quoted, or reproduced for distribution outside the client organization without prior written approval from McKinsey & Company. This material was used by McKinsey & Company during an oral presentation; it is not a complete record of the discussion.

2. 1 The global ICT footprint* *ICT includes PCs, telecoms networks and devices, printers and data centers. †Compounded Annual Growth Rate GtCO2e 0.53 0.83 1.43 2002 2007 2020 CAGR † +6% Embedded carbon Footprint from use 2% of total footprint

3. 2 The global ICT footprint by geography 2002 2007 2020 CAGR Percent 171811131625 23 12101420 27291071214 996343 % of 0.53 % of 0.83 % of 1.43 Percent of GtCO 2 e * EiT = Economies in transition. (includes Russia and non-OECD Eastern European countries) † RoW = Rest of the World. (includes India, Brazil, South Africa, Indonesia and Egypt) RoW† China EiT* Other industrialized countries OECD Europe U.S. and Canada

4. 3 The global ICT footprint by subsector *Printers were 11% of the total ICT footprint in 2002, 8% in 2007 and will be 12% in 2020 2002 2007 2020 2518 281457 371449 57 % of 0.53 % of 0.83 % of 1.43 Telecoms, infrastructure and devices Data centers PCs, peripherals and printers* CAGR Percent 575 Percent of GtCO 2 e

5. 4 ICT footprint and impact of ICT-enabled abatements 40.0 ICT 0.5 2020 BAU Abatements 2020 with abatements 51.9 ICT 1.4 -14.1*-7.8 30† *For example, avoided deforestation, wind power or biofuels †21.9 GtCO2e abatements were identified in the McKinsey abatement cost curve and from estimates in this study. Source:Enkvist P., T.Naucler and J. Rosander (2007), ‘A Cost Curve for Greenhouse Gas Reduction’, The McKinsey Quarterly, Number 1 GtCO 2 e Emissions ICT footprint Other abatements† Selected ICT-enabled abatements 2002 5 times ICT’s direct footprint

6. 5 ICT-enabled abatements * Dematerialisation breaks down into all sectors except power. See detailed assumptions in Appendix 3. † Reduces warehousing space needed through reduction in inventory. See Appendix 3. ‡ Reduces energy used in the home through behaviour change. See Appendix 3.

7. 6 Research details This presentation is extracted from research conducted by McKinsey & Company as independent analysis for The Climate Group on behalf of the Global eSustainability Initiative (GeSI). Full report: http://www.smart2020.org/ McKinsey & Company Contacts: Markus Löffler Markus_Loeffler@mckinsey.com James Manyika James_Manyika@mckinsey.com Jeremy Oppenheim Jeremy_Oppenheim@mckinsey.com Supporting organizations: GeSI and member companies: Bell Canada, British Telecommunications plc, Cisco Systems, Deutsche Telekom AG, Ericsson, France Telecom, Hewlett-Packard, Intel, Microsoft, Nokia, Nokia Siemens Networks, Sun Microsystems, T-Mobile, Telefónica S.A., Telenor, Verizon, Vodaphone plc. Additional support: Dell, LG