U.S. Department of Energy Selects Eaton and HP to Improve Energy Efficiency in IT Systems; Stimulus Grant to Fund Program

Date: January 13, 2010

PITTSBURGH ... Diversified industrial manufacturer Eaton Corporation (NYSE:ETN) today announced it is collaborating with HP on a federally funded project to improve energy efficiency in information technology (IT) systems. Among the 14 projects chosen by the U.S. Department of Energy, the joint proposal from Eaton and HP was selected as the third-largest grant recipient at $7.4 million.

The joint project from Eaton and HP will develop a fully enclosed IT rack system that provides its own internal power and cooling. High voltage and chilled water will act as the primary inputs to the system and it will also accept alternative energy power sources, such as wind and solar power. A major benefit of this system is a 38 percent reduction in energy use to support a 100 kilowatt (kW) IT load, which equals a reduction in carbon dioxide emissions by approximately 400 tons annually.

“Eaton is at the forefront of the development of solutions that make our information technology infrastructure more reliable, more sustainable and cost effective,” said Thomas S. Gross, vice chairman and chief operating officer, Eaton’s Electrical Sector. “As a global leader in power management, we are well-positioned to work with government and the private sector to maximize the long-term benefits of initiatives like this.”

"HP and Eaton are working to introduce new technologies that will help businesses reduce power consumption by as much as 40 percent, lower costs and extend the life of data centers, decreasing the need for new facilities," said Doug Oathout, vice president of Converged Infrastructure, HP. "With this grant, Eaton and HP’s combined expertise will enable us to create an innovative technology solution that increases energy efficiency and meets government mandates to reduce carbon emissions while diminishing the need to build new power plants to support data centers."

On January 6, 2010, Energy Secretary Steven Chu announced the U.S. Department of Energy initiative, which includes $47 million for projects across the country to support the development of new technologies that improve energy efficiency in the IT and communication technology sectors. The American Recovery and Reinvestment Act (ARRA), also known as the Stimulus Program, will fund the research for development and demonstration projects in three subject areas: equipment and software, power supply chain and cooling. The energy efficiency projects will reduce energy use and carbon pollution, while helping to develop a strong, competitive domestic industry.

More information about Eaton’s involvement in a wide range of initiatives related to the ARRA is available at http://www.eaton.com/recovery .

Eaton’s electrical business is a global leader in power distribution, power quality, control and industrial automation products and services. Eaton’s global electrical product lines, including Cutler-Hammer®, Moeller®, Powerware®, Holec®, MEM®, Santak® and MGE Office Protection Systems™ provide customer-driven PowerChain Management® solutions to serve the power system needs of the data center, industrial, institutional, government, utility, commercial, residential and OEM markets worldwide.

Eaton Corporation is a diversified power management company with 2008 sales of $15.4 billion. Eaton is a global technology leader in electrical components and systems for power quality, distribution and control; hydraulics components, systems and services for industrial and mobile equipment; aerospace fuel, hydraulics and pneumatic systems for commercial and military use; and truck and automotive drivetrain and powertrain systems for performance, fuel economy and safety. Eaton has approximately 70,000 employees and sells products to customers in more than 150 countries.

Mark Horner