In an interview with Japanese site PC Impress Watch, Sony’s Ken Kutaragi said that because of the power of the Cell processor and the RSX graphics chip, PlayStation 3 will use a custom cooling solution, with heat pipes. Heat pipes conduct the heat much faster than conventional cooling, and are commonly used to cool high-end PCs. Kutaragi also said that:

“We’re spending a lot on heat and electromagnetic interference (management). The power supply could almost be sold separately.”

Confirming the rumors that the PS3 will need a large power supply, presumably bigger than the ones found in modern PCs.

How heat pipes work (Wikipedia).