I think the requirements for power are much different in case of glacier that with some more generic computing. With a service like glacier, running on hard disks, you could probably completely turn off large parts of your infrastructure. With 5 hour read latency there should be plenty of opportunities to optimize the reads so that only a small part of the infra needs to be powered on at any time.
Also you might be able to skip the backup power part completely. The data is anyways distributed to few locations. The probability of many of them losing to power at the same time for several hours is likely to be very small.
Maybe there's also large differences in how the customers use the system. I would assume some customers are more likely to retrieve data than others. Once you start learning these patterns you could further optimize the storage.
The pricing of Glacier is not necessarily driven by technical reasons. Amazon already has S3 and they need to differentiate the products.