ENERGY and GHG EMISSIONS
LG Electronics established the following strategic directions for climate change response: "Reduction of GHG emissions associated with production," "reduction of GHG emissions associated with product use," "reduction of GHG emissions across the value chain," and "commitment to social responsibility based on promotion of low-carbon culture," and make a wide range of efforts to deliver results.
Operational Energy Efficiency
· Improving Operational Efficiency of Equipment and Facilities
LG Electronics continuously works to optimize and minimize our energy use by improving the efficiency of our facilities and production processes. We use the results of regular energy assessments performed by our internal experts to design and carry activities such as optimizing capacity/control (of motors, pumps and utility equipment of cooling towers), enhancing the differential pressure of air compressors, minimizing zero-load operations, and optimizing the washing process.
· Expanding Investments in High Efficiency Equipment and Facilities
LG Electronics is expanding investments in high efficiency equipment and facilities. We have replaced the lighting systems with LEDs across our business sites to reduce 2,800 tons of GHG emissions in 2014, and invested in automated control systems BdMS1) and BPAM2) to improve our capacity for peak-time control, which also help reduce GHG emissions.
· Expanding the Use of Renewable Energy
LG Electronics has expanded solar power generating systems at our business sites in Korea to secure a combined capacity of 5.4 MWh, producing a total of approximately 6,900 MWh (cumulative) in 2014 and reducing about 6,217 tons of GHG emissions. Office buildings in the United States and Europe are also increasing their purchase of renewable energy. In 2014, US facilities purchased a total of 3,109 MWh of renewable energy, while our European office buildings used 2,586 MWh of renewable energy at the same year.
Production level GHG Emissions (Scope1 & 2)
LG Electronics has set a target to reduce 150,000 tons of GHG emissions associated with production in 2020 from the base year 2008 (10% reduction) through GHG reduction efforts, including production process innovation, facility/operation efficiency improvement, and renewable energy use. Based on the target, we expect to reduce a total of approximately 1 million tons (cumulative) of GHG emissions from 2009 to 2020.
Expanding GHG Management Across Value Chain
· Office Building GHG Management
Since 2008, we have managed the GHG emissions of office buildings in Korea. In 2014, a total of 9,134 tons of GHG was emitted from office buildings, including the leased office spaces that house more than 100 fulltime employees.
In order to reduce GHG emissions from major office buildings at our overseas locations, we have set mid- to longterm reduction targets for office buildings in the United States and Europe and managed them accordingly. LG Electronics USA has set an ambitious target to reduce GHG emissions in U.S. operations by 50% by 2020. To achieve this target, the subsidiary joined the EPA led "Green Power Partnership" that encourages organizations to reduce their environmental impact by using renewable energy. LG Electronics USA is also reducing U.S. logistics-related emissions in supply chain by using freight carriers that participate in the EPA 's SmartWay program. European subsidiaries have set targets to reduce 15% of GHG emissions from office buildings by 2020 from the base year 2010, via diverse range of measures that include installing solar panels and expanding the use of renewable energy.
· Logistics & Business Travels
Total GHG emissions from logistics activities in Korea in 2014 amounted to 40,960 tons CO2e, down 847 tons from the previous year. We plan to further reduce GHG emissions from logistics activities through ongoing efforts toward logistics system improvement, energy use optimization, and IT system implementation. In 2014, the total GHG emissions associated with employee business travels by employees in Korea amounted to 57,348 tons.
· Clean Development Mechanism
LG Electronics' Clean Development Mechanism (CDM) project in India was finally approved by the UNFCCC (United Nations Framework Convention on Climate Change) in 2013. Through this project, we plan to acquire carbon credits in exchange for the sales of highly efficient refrigerators in India, and finally in February 2015, we earned 6,954 tons of carbon credits, which translate into CO2 reductions equivalent to planting 570,000 30 year-old pine trees. It was the first among CDM projects to acquire carbon credits through the production and sales of appliances, and we expect to reduce 5.8 million tons of GHG emissions annually over the next ten years. We also plan to donate a portion of the profits from the project to local communities in the form of scholarships to women and children from low income households.
Selected as Member of CDP Korea's "Carbon Management Honors Club"
LG Electronics was selected as a member of the CDP (Carbon Disclosure Project) Korea's "Carbon Management Honors Club," a ecognition given to businesses for excellence in climate change responses.
PRODUCT USAGE LEVEL GHG REDUCTION TARGET
LG Electronics plans to contribute to the reduction of GHG emissions associated with product use by developing and introducing highly energy efficient products. We have established a target to reduce 30 million tons of GHG emissions from BAU by 2020. LG Electronics is estimated to contribute to a total reduction of about 200 million tons (cumulative) of GHG emissions associated with product use from 2009 to 2020.