Green Business Case Studies in Asia

1. Green Business Case Studies in Asia Yang, Si Eun Graduate School of International Studies, Korea University 2nd Training of Trainers Capacity Development Seminar29 March – 1 April, 2010 Seoul, Republic of Korea

2. Contents Part I. Mainstream Business • Cleaner Production: Sharp Corporation • Green Products: Samsung Electronics Part II. Pro-Poor Green Business • Rural Electrification: Sunlabob • Green Loan: Xac Bank

3. Part I. • Mainstream • Business

4. Cleaner Production • A leading manufacturer of photovoltaic power systems and electronic appliances • operates 38 plants in more than 20 countries worldwide • To improve environmental performance Sharp established a system to develop environmentally sustainable Green Factories based on Green Factory Guidleine.

5. Green Factory Guidelines ■10 Key Areas 1) greenhouse gases 2) energy 3) waste 4) resources 5) chemical substances 6) the atmosphere, waste and soil 7) harmony with nature 8) harmony with the community 9) environmental awareness 10) information disclosure ■ Based on these guidelines Sharp set unique quantified environmental performance criteria

6. ■ SGF Quantified Environmental Performance Criteria and Assessment Weighting in Japan

7. ■SGF II System Beginning of fiscal 2008, Sharpe launched SGF II, a new initiative for plants in Japan that have attained SGF certification

8. ■ SGF II Quantified Environmental Performance Criteria and Assessment Weighting in Japan ※Total score is 200point including previous SGF criteria • SGF II adds an assessment of “soft” aspects to the previous initiative such as the know-how to maintain and upgrade environmental equipment.

9. Achievement ■ Since Sharp Corporation has launched this in-house certification activity in 2003, 16 plants out of 38 worldwide were certified as a Green Factories and 21 plants were certified as being a Super Green Factory. ■ Curbing Green house gasses emitted in 2008 ■ Improved in minimizing and recycling waste ■ Improved in water recycling

10. ■ Amount of Sharp Group’s Greenhouse Gas Emission • In fiscal 2008 reduced total GHGs emission by 6%. • Partly due to Japanese economic recession • However, effort by SGF / SGFII and installation of PFCs emission abatement system are major contributors.

11. 10% reduction in amount of waste etc. discharged by the Sharp Group(Japan & overseas) • achieved Zero discharge in landfill in 8 consecutive year in 2008 • Valuable resources recovered from waste at 10 plants in Japan expanded by 31% compared to the previous fiscal year, while the total amount of waste discharged decreased by 16%

12. The amount of water used by the Sharp group in fiscal 2008 decreased by 11% over the previous fiscal year, thanks to increase in recycling water and decrease in production volume

13. Greening Products Samsung Electronics ■ Founded in 1969 in Korea, Samsung Electronics Co., Ltd. manufactures and sells a wide variety of electronic products, communication devices, and semiconductors. ■ The company has responded to the challenges of climate change and environmental degradation by taking green management policy as one of its CSR initiative ■ Green management principles: greening of; management, products, processes, the workplace, and communities.

14. GreeningProduct? ■ Samsung Electronics defines greening products as “minimizing environmental impacts throughout the product development, manufacturing, usage, and disposal stages” ■ Geening of products can also play an important role in promoting a carbon-lean and low energy lifestyle amongst consumers by reducing CO2 emissions emitted by using the products.

15. How to GreeningProducts? ■ life cycle assessments (LCA) ■ eco-design assessment systems ■ eco-friendly supply chains ■ hazardous material regulation response systems ■ extended end-of-life product disposal capacity ■ Extended Producer Responsibility (EPR) systems

16. Achievements • Acquired environmental certifications in major global markets • six environmental certifications from Republic of Korea (EDP), China, U.S. (EPEAT), Germany (Blue Angel), Sweden (TCO) and the EU (Eco-Power) covering 1,900 models in seven product groups; printers, PCs, monitors, TVs, DVDs, refrigerators, and washing machines. • The largest number of certifications ever won by a single electronic company in the world

17. Eco-Products LED TV Energy Saving • ↓energy consumption by43% ( 183W→105W ) , • ↓ remaining powerby 86%( 0.7W→0.1W ) • ☞ ↓ carbon emission by 38.1 kg annually • ( equivalent of planting 14 fine tree ) Resource Efficiency • ↓ 6.3% in weight ( 24kg→22.5kg ), depth70.4%( 9.8cm→2.9cm ) • ↓ package volume by 31% • (↑Load efficiency by43%, 203EA→ 291EA) [ UN46B7000WF ] Material Safety • -Non VOC(VOC : Volatile Organic Compounds) and Mercury employed • employ anLED back light unit (existing products containHg 77mg ) • free of six hazardous materials regulated by EU standards in the production process

18. Application of environment-friendly packaging material for 42inch PDP-TV • development of folding stand of PDP TV is an idea for packagematerial reduction and cost saving • Fold the stand as following picture at packaging time for minimize its depth and unfold the stand when TV is installed. [ Before] [ After ]

19. Exterior Size of Package • Halved its depth of previous model. (Previous : 455mm, Improved : 228mm) • Efficiency : ↓ 66% distribution cost from Korea to LA, U.S.A. • ∵ the number of lightened TV has risen from 104 to 312 in container with 40ft-HC loaded weight. [ Comparison of external package size reduction ]

20. Cushion Volume • The weight of 503g of cushion reduced in comparison to the previous one. (Previous : 986g → Improved : 483g) Improved model Previous model [ Case 1 ] Improved model Previous model [ Case 2 ]

21. Corrugated cardboard usage • 0.9775m2 of corrugated cardboard usage is reduced based on outer box. [ Before] [ After ]

22. Part II. Pro-Poor Green Business

23. Renewable Energy – solar rechargeable lantern Sunlabob ■ Founded: 2001 ■ Activities: Full service energy provider selling hardware and energy services in remote regions where there is no access to grid electricity. ■ Size: Has installed over 5,600 systems in 450 villages across Lao PDR ■ Location: Headquarters in Lao PDR, operations across Southeast Asia and growing number in Africa

24. What Needs Were There? ■ Although 58% of Lao population has access to grid electricity this is concentrated in cities and town area. ■ High dependency on Kerosene lamps for lightening DANGEROUS Needs for Alternative Energy Resources - Respiratory disease - Fire potential • Cheap • Easily maintained

25. Solution? Solar Energy ■ Cost competitive ■ No need to worry about rising fuel price ■ Cheap in long-term ■ Environmental friendly energy

26. SolarRechargeable Lantern • Last 10-20hrs depending on battery and globe selected • Simple to repair: Simple construction and readily available familiar components • Manufactured/Assembled on site by local staff/ Utilize as much as possible local material • Can be used as ceiling lamp or can be set on the table

27. SolarLanternRecharge Station • ■ Located in center of village for easy access • ■ operated by village entrepreneurs under the franchise agreement with Sunlabob • ■ can recharge 24 to 144 lanterns depending on the size of the solar array and battery station • Achieve Economies of scale • Offer affordable recharging fee for village household

28. Whatare the Benefits? ■ Extra income generation using night time ■ Reliable and regular income for village technicians / village entrepreneurs ■ Green job creation ■ Electricity supply in off-grid rural area ■ Less environmental impact ⇒ Rural Development and Poverty Alleviation ⇒ Improved Resilience and Capacity to Adapt Climate Change

29. Green Loan – poverty alleviation • Founded in 1998 • Activities: providing financial products and services including microfinancing • Size & Location: : forth largest commercial bank in Mongolia with a nationwide network of 77 branches and is headquartered in Ulaanbaatar.

30. What Needs Were There? In Ulaanbaatar 70 % of population lives in a ger, a traditional Mongolian dwelling made of a wooden frame covered by layers of wool felt.

31. What Needs Were There? • Average winter temperatures: -20℃ • Households in ger-districts consume an average of 5 tons of coal and 1.5 tons of wood per year. • Pollution levels in the city during the winter season are on average over twenty times higher than those of summer • The poorest 20 % of the city’s population spends as much as 40 % of their monthly income roughly a $140 a month on coal and wood for heating. • cuts in nutrition and health budgets

32. Xac Bank’s Eco Product Program ■offering low interest loans to make eco products financially accessible to the residents of the Ger District ■ 3 types of green loans for personal consumption • energy efficient stoves, • ger covers • energy efficient fuel ■ The loan products were developed in conjunction with Financierings-MaatschappijvoorOntwikkelingslanden (FMO), the entrepreneurial development bank of the Netherlands.

33. Energy EfficientStoves ■Introduced a loan product for the stove of 2 years duration with zero down payment and an annual interest rate of 17% ■Stoves were developed and tested by GTZ  ■a type of brick similar to that found in a pottery kiln and are designed to circulate and retain heat for longer periods than traditional stoves.   • reduces fuel consumption by more than 60%/month • helps to reduce a family’s air pollution

34. Ger Covers • large insulating blankets composed of three separate layers that wrap the entire outside of the ger. • designed by the UNDP but is produced locally in Mongolia • helps to keep heat within the ger • results in a 50% reduction in fuel burned/m 

35. Energy Efficient Fuel • loan to buy fuel from producers who create efficient fuels from things like compacted sawdust and gasified coal. • more expensive than traditional fuels but have less of a negative impact on the environment by burning longer and producing less carbon output.  • price difference between clean fuels and brown coal is made up through clients using less fuel to achieve the same heating results

36. Carbon Revenues ■ Energy efficient products that the Bank is promoting are standardized the amount of their carbon emissions can easily be calculated • it enables aggregate carbon offsets from the program to be sold on the voluntary carbon market ■ In October 2009 bank finalized a Carbon Purchase Agreement with Micro Energy Credits (MEC), a social enterprise which links microfinance institutions to the carbon markets. • additional revenue from carbon offsetting • become the first micro-finance institution in the Northern Hemisphere to generate carbon revenues. • The revenue earned from carbon offsets can now be used for further loans or other socially or environmentally beneficial products.

37. What are theBenefits? ■ provides affordable means for low income households to lower their fuel costs, ■ reduce air pollution and greenhouse gas emissions from heating and cooking, ■ Allow them to stay warm during the long winter season. • The bank has become a showcase of green business practices by earning revenue from the carbon markets while improving the lives of the poor.

38. Q &A

39. Thank You!! Yang, Si Eun Graduate School of International Studies, Korea University Sieun.yang7@gmail.com