NEW YORK — The $120 billion semiconductor industry is looking to green initiatives like a U.S. smart grid as a new growth opportunity.

During a media day here, Semiconductor Industry Association (SIA) president George Scalise cited a 2008 report by the Technology CEO Council estimating that energy efficiency improvements over the last 40 years in computers totaled "2,857,000 percent" thanks to semiconductor-enabled scaling.

"Over the past decades and into the next, semiconductors can revolutionize how we generate, distribute and consume energy, transforming the economy much as semiconductors enabled the information economy," Scalise asserted. He predicted that semiconductors will be a key technology that "will enable us to harness alternative energy sources more effectively, distribute it more efficiently and intelligently and consume it in the most efficient manner."

In the short term, he added, semiconductors can help build a U.S. smart grid.

"At its core, smart grid transformation represents the digitization of one of the last major analog-based industries," said Bernard Meyerson, IBM Fellow and CTO of IBM Systems & Technology Group. "Power grids use sensors, smart meters, digital controls and analytic tools to automatically monitor and control two-way energy flow."

Last month, IBM signed a 70 million euro contract with Maltese National Electricity and Water Utilities under a five-year project for a nationwide smart grid implementation. The utility and other contractors are seeking to transform key utility processes by introducing smart meters to manage consumption.

IBM will replace 250,000 analog electricity meters with new smart electronic devices. It also will integrate water meters and advanced IT applications, enabling remote monitoring, management and meter reading. The system is expected to be completed by the end of 2012.

Citing various studies, Texas Instruments Fellow Dave Freeman said some 50 million analog meters in the U.S. are likely to be replaced by 2010 at a cost of about $18 billion. Worldwide, only 6 percent of electricity, 8 percent of gas and 4 percent of water meters are now automated.

Freeman said that using "smart" solutions would enable home thermostats and large appliances to communicate wirelessly or over existing power lines to help consumers conserve energy. He pointed to recent U.S. policies and incentives for developing a smart grid. "Because utilities are regulated at the state level, adoption has not been uniform," said Freeman. "So far utility commissions in California, Colorado and Texas have been the most proactive."

Freeman, Meyerson and Scalise all agreed that national standards must be adopted. "The SIA is working to help enable those standards," said Daryl Hatano, SIA's vice president for public policy.