Intel Targets Share of $5 Billion Smart-Grid Market

Intel Corp. (INTC), the world’s largest chipmaker, plans to expand in the global smart-grid market following a jump in demand for energy-saving technologies.

Intel intends to take a “significant chunk” of the market for smart-grid microprocessors, which may surpass $5 billion in annual sales by the end of the decade, said Hannes Schwaderer, Intel’s director of energy in Europe, Middle East and Africa.

Smart grids allow power generators and users to monitor usage, helping utilities adjust supply to consumption and reducing costs by saving energy in transmission. Demand for the technology has grown as countries boost renewables output, overloading traditional networks when production peaks.

“There’s a lot happening in smart-grid development,” Schwaderer said in a telephone interview. “There is a big momentum, there is a big need in the industry and there’s a big opportunity for Intel to sell more chips. That’s why we’re in.”

The company, based in Santa Clara, California, is already forging partnerships to tap the market. It has agreed with France’s Alstom SA (ALO) to cooperate on smart grids and is working with Germany’s EON SE on better integration of renewables on the country’s transmission network.

Fellow Californian manufacturer Cisco Systems Inc. (CSCO) and Armonk, New York-based International Business Machines Corp. are also seeking to expand in the smart-energy networks industry.

“It’s not a market where Intel is operating in isolation, there is a lot of competition out there,” Schwaderer said. “But what we have on our road map for microprocessors can address a significant chunk of that.”

European nations in particular will drive growth in the industry as Germany and the U.K. bolster renewable generation to meet climate-change targets, he said. The International Energy Agency says $38 trillion of investment in energy-supply infrastructure is needed by 2035 to meet increasing demand.

To contact the reporter on this story: Sally Bakewell in London at sbakewell1@bloomberg.net

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