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Climate change and Energy

Climate
Change
and
Energy
Management
Save energy and carbon reduction Management

Facing the challenges of global climate change and the government's promotion of net-zero carbon emission policies, we have continued to make efforts to reduce greenhouse gas emissions for sustainable development. Through industry-academia collaboration, we incorporate AI big data technology into our process to improve efficiency and build smart factories.


To improve physical fitness, we actively introduce various management operating systems (ISO 50001, ISO 14064-1, ISO 14067, ISO 46001, ISO 14046, PSM, GRS), and refer to international and various technological developments to propose various improvement plans and Following the Group's carbon reduction goals with 2017 as the baseline year, set the goal of 27% carbon reduction by 2030, and carbon neutrality by 2050, we set annual carbon reduction goals appropriately, review and continue to implement the replacement plan every year.


CGPC has been committed to transforming our factory areas, improve environmental friendliness, and a safe working environment. In June 2024, our company finally received recognition and obtained the Cleaner Production Assessment System Certificate.

Energy Efficiency and Carbon Reduction Performance
Decarbonization pathway planning of Vinyl Chain
Implementation and results
  • Promote establishment of the ISO-50001 energy management system
    As of 2022, the USI Corporation has successfully verified nine factories.
    CGPC and CGPCP have obtained the ISO 50001 verification in 2019.
    TVCM has obtained the ISO 50001 verification in April 2021.
  • Actively carry out energy conservation and carbon reduction actions.
    Continue to participate in the Earth Hour movement to reduce environmental impact.
  • Awarded the “Performance of Excellence” trophy by the Ministry of Economic Affairs.
    warded the “Performance of Excellence” trophy for the promotion of the energy conservation service team fro 2016 to 2018.
  • Recognized by the Water Resources Agency for water conservation efforts.
    CGPCP recognized by the Water Resources Agency for its water conservation efforts in 2022.03.22 .
Energy Efficiency and Carbon Reduction Program
  • By company
  • Energy conservation and carbon reduction solutions
  • 2023 performance
    Amount of energy conservation(GJ) Amount of carbon reduction(tons CO2e)
  • CGPC
    (Main Plant)
  • Replacement of Supercharged D set of compressors
    Replacement of 800RT refrigerators, and improvement of energy savings of the external circulation pump of the chilled water system
    Improvement of Supercharged compressed air pressure for energy saving
    Improvement of natural gas boiler energy saving
    Improvements in thermal insulation
    Replacement of old air compressors with new models
    Improvement of energy-saving screw sleeve electric heaters in the extrusion machine
  • 58,347 3,679
  • TVCM
    (Linyuan Plant)
  • Replacement of the cooling tower circulation pump (P-6010A)
    Replacement of Cooling Tower Circulating Water Motor (PM-6010C)
    Add variable frequency control to the cooling tower fan B-6001A
    Factory-wide Cooler Improvement Project (Phase 2)
    Intelligent control of 35-ton boiler
  • 66,670 4,226
  • CGPCP
    (Linyuan Plant)
  • Replacement of Obsolete RF-2401A Chiller Equipment
    Replace old water dispensers in the factory with new ones
    Optimization of hot pure water vapor heating system
  • 28,850 2,065
  • Total
  • 153,867 9,970
Note:
1.
The data comes from the Energy Administration‘s annual energy conservation inspection system reporting form.
2.
In 2023, the three factories saved a total of 153,867 GJ in energy and reduced 9,970 tons of CO2e, about the carbon absorption volume of 26 Daan Forest Parks.
3.
This program does not include the carbon reduction benefits of offset projects. Please refer to the explanation provided in the Greenhouse gas replacement project Quota Application for further details.
4.
The calculation methodologies and formulas used, Please refer CGPC ESG report 2023 Page 90.
The Group's cross-plant technical exchange seminar in 2023
On Wednesday, October 25, 2023, a "Group Plant Technical Exchange Meeting" was held at the TVCM Linyuan plant. Continuing from last year, with the core themes of “Occupational Safety and Environmental Protection”, “Equipment Maintenance”, “Energy Conservation and Carbon Reduction”, each of the 12 plants in Taiwan proposed 1 or more technical cases. These cases underwent a written review and ultimately, 7 plants cases were selected as finalists. The final selection was made through voting and scoring by senior executives of the group and representatives from the presenting factories to determine the top three outstanding technical cases of the year. In accordance with the Group's Safety Incentive Measures - Cumulative Safety Days by each plant, trophies will be awarded and a group photo taken during the meeting as an encouragement.

Han-Fu Lin, Chairperson, commented at the event. He mentioned that this year's cases include improving the working environment of employees, deepening the implementation of energy conservation and carbon reduction, and professional exploration of the equipment pre-insurance, and other achievements. The performance of each plant is worthy of recognition, and it is still necessary for everyone to work together in the future to enable the Group to be able to continue to improve in various fields.
The Group's cross-plant technical exchange seminar and award in 2023

◆ Technical case publication award information:

TVCM Linyuan Plant has won the first place in the technical case publication selection for three consecutive years!

TVCM Linyuan Plant(Excellent)
Project name：『TCVM Steam Boiler Optimization and Improvement』

Reaching 1,000 safety days - Outstanding Performance Award
CGPC Main Plant(First Place)
Project name：『Activated carbon Fluidized Bed Technology for VOCs Adsorption and Control』

Han-fu, Lin Chairman, presented the award to TVCM Section Chief Jie-Lin, Zhuang (representative recipient)
CDP Questionnaire
Our supply chain was invited to participate in the CDP questionnaire: Climate Change and Water Security in 2023, which received B- and B, respectively.
Participate in the world’s largest voluntary public welfare carbon reduction action
CGPC, TVCM, and CGPCP (Including Taipei Office,Tai-An Building) jointly participated in the Earth Hour movement.
Response time :
From 8:30PM to 9:30PM on March25, 2023 and March 23, 2024
Response mode : Turn off unnecessary lights
Banks' green finance ESG indicators
In response to the government's promotion of green sustainability, CGPC, as an enterprise of excellence, has actively cooperated with banks in bundling the ESG loan line of credit, and obtained the approval of 3-year energy conservation and carbon reduction indicators, and the indicators are as follows:
1.
Energy consumption per unit product of CGPC's PVC resin.
2.
Greenhouse gas emission intensity per unit product of CGPC's PVC resin.
3.
CGPC increased the growth rate of recycled water.
4.
CGPC unit water consumption.
5.
The total amount of waste generated by CGPC.
6.
Water consumption of TVCM Linyuan plant.
Application items for obtaining bank ESG financing lines and low interest rates
  • 1.
    CGPC and TVCM continue to implement ESG development, signing sustainability-linked loans with Chang Hwa Bank, Fubon Bank,and other banks.
  • 2.
    Application items for the low interest rate program of CGPC and TVCM:
    •
    CGPC's application plan: Deeply-rooted Taiwanese enterprises - automatic warehousing; Taiwanese business participants returning to invest in Taiwan – VCM storage tanks.
    •
    TVCM: Small and Medium Enterprises - Intercontinental Phase II Project
  • 3.
    The low-interest rate projects supported by the government in 2023 were approximately NT$18.56 million.
Greenhouse gas replacement project quota obtained
Since 2018, CGPC has implemented two greenhouse gas offset projects. These projects, namely the “Updated replacement project of the IEM Alkali Evaporator Tank” by CGPC and the “Cracking Furnace Replacement Project for Furnaces F-6201 and F-6202” by TVCM, have undergone third-party verification and registered for approval. On February 23, 2022, and May 3, 2022, respectively, both projects were approved in the first round of quota applications by the Ministry of Environment, obtaining a total reduction quota of 7,464 tonnes of CO2e. These measures were taken to reduce future carbon regulatory risks. Please refer to the official letter of the Ministry of Environment, Executive Yuan: Updated the IEM Alkali Evaporation Tank Offset Project and Replacing two pyrolysis furnaces (F-6201 and F-6202).
Identify climate risk and opportunity
Facing the increasing impact on operations by climate change, CGPC prudently assesses possible risks and grasps potential new business opportunities. In recent years, we have actively implemented energy conservation and carbon reduction improvement solutions to enhance production efficiency, renovation and replacement of old equipment with newer high-performance energy conservation equipment. We adopt the TCFD approach to identify the transition and physical risks in the operation process and found 5 main risk items and 7 main opportunity items. In 2021, we categorized them based on the time of occurrence, and will review the response measures every year to build a resilient climate change culture.

Indicators and objectives 

The Group's energy management objectives
The Group's carbon reduction goals with 2017 as the baseline year, set the goal of 27% carbon reduction by 2030, and carbon neutrality by 2050. and will be reviewed every three years.
climate response strategies
•
Short term: Actively implement energy conservation and carbon reduction plans.
•
Medium-term: Carbon reduction strategy is set towards low-carbon energy transformation, energy efficiency improvement, intelligent monitoring, and the installation and use of renewable energy.
•
Long-term: Carbon reduction strategy continues to focus on low-carbon fuels, arbon capture and reuse technology, and carbon negative technology to implement carbon reduction strategies.
promotes internal carbon pricing
USI Group will introduce an internal carbon pricing system in 2024. The price will refer to the domestic carbon tariff pricing basis, and it is planned to integrate this system into corporate decision-making and investment. During the assessment process, the impact of carbon emissions on business operations is assessed to accelerate the implementation of carbon reduction measures.
Greenhouse gas emissions revealed
We use Greenhouse gas inventories to examine carbon emission hot spots in each plant and regularly review the reasons for increases and decreases. We also disclose scope 1 to 3 emission data in sustainability reports, public information observatories, and ESG web pages.

Climate-related risk items are divided into 3 intervals according to the time period of occurrence of impacts. The impact of climate-related opportunity items on the Company’s development and technical feasibility is divided into 5 levels, corresponding to the following table:
Type Item Time frame of occurrence
Physical
Risks		 Floods and Inundation Intermediate-term (3 to 7 years)
Drought Intermediate-term (3 to 7 years)
Transition
Risks		 Carbon Fee Short-term (< 3 years)
Renewable Energy Regulations - Risk of Clause for Large Power Users Short-term (< 3 years)
Low-carbon technology transition Short-term (< 3 years)
Rising raw material prices Short-term (< 3 years)
Type Item Development Technical feasibility
Opportunity Efficient production With development potential, as part of the Company's policy Under expansion
Recycling and Reuse - Circular Economy With development potential, as part of the Company's policy Under expansion
Reduce water usage and waste With development potential, as part of the Company's policy Matured
Use low-carbon energy With development potential, as part of the Company's policy Matured
R&D and innovation for developing new products and services - R&D of low-carbon energy-saving products With development potential, as part of the Company's policy Under expansion
Better Use of Public Sector Incentives With development potential, as part of the Company's policy Under expansion



Category Item Risk Topic
Physical
Risks		 1 Floods and Inundation
2 Drought
3 High temperature
Transition
Risks		 4 Government regulation or supervision
5 Carbon Tax/Fees
6 Product Efficiency Regulations and Standards
7 Renewable Energy Regulations
8 Changes in customer preferences
9 Credit risk
10 Low-carbon technology transition
11 Uncertainty of market information
12 Changes in raw material prices



Category Item Risk Topic
Opportunity
Topics		 1 Adopt more efficient transportation methods
2 Use more efficient production and distribution processes
3 Recovery and reuse
4 Shift to more efficient buildings
5 Reduce water usage and waste
6 Use low-carbon energy
7 Use of new technology
8 Participate in carbon trading market
9 Develop and/or increase low-carbon products and services
10 R&D and innovation in developing new products and services
11 Enter new markets
12 Better Use of Public Sector Incentives
Potential financial impact of risks and opportunities
Due to environmental degradation, energy and natural resource scarcity, intensified climate change, and stricter government regulations, businesses face pressure and challenges. Facing these external pressures is both a challenge and an opportunity. We continue to promote the work of "energy conservation and carbon reduction" with practical actions in an honest and responsible attitude. We set the environmental protection goals of power, energy and water conservation and carbon reduction and try our best to reduce the impact of business operations on the environment, further achieving the eco-friendly goals of low pollution and low energy consumption.
Climate Change Topics Topic Category Description of Risks and Opportunities Potential Financial Impact Vinyl Chain Strategy and Countermeasures
Floods and Inundation Physical Risk/Chronic
According to the data from the Water Resources Administration, if 500 mm of rain falls within 24 hours, it is estimated that 0 to 1 meters of flooding will occur in the near future (2016-2035) and will last for 1 day.
The above heavy rainfall/flooding leads to the shutdown of the plant due to flooding, which will reduce the turnover.
Increasing operating costs

NT$12.11 million was invested for the reconstruc-tion of old rainwater gutters at CGPC Main plant.
The cost of related flood control and drainage measures for Linyuan plant was about NT$5 million.
Reconstruction of old storm water ditches at Toufen Main plant : Add two external discharge outlets and remove sludge. The second phase of storm water renovation is reviewed in conjunction with the project of replacing the overlapped troughs with new ones before proceeding with planning.
Relevant flood control measures in the TVCM plant : A storm water interception pond was set up to ensure that the rainwater ditch would take 30 minutes to naturally overflow to the outside of the factory during heavy rainfall. During the period, rainwater was collected in the storm water interception pond for storage and pumped to the wastewater treatment plant.
Note:
The Taiwan Green Productivity Foundation introduced the TCFD scenario analysis in 2023 for the CGPC Main plant, and the “flooding” items were assessed to be minor risks and long-term risks.
Drought Physical Risk/Chronic
Taking 1986-2005 as the base period, the recent climate conditions (2016-2035) have shown that the maximum number of consec- utive days without rainfall is 50-58 per year, and water shortage or drought may occur.
In response to abnormal weather condi- tions, resulting in water restrictions or water shortages in the plant area, production line production will be reduced or work will be suspended altogether in severe cases.
Increased capital expenditures and increased costs of revenue

The cost of the centrifuge dryer process water re- covery (HBF) project was about NT$92.83 million, and the water saving volume in 2023 reached 597.4 million liters/year.
The total investment for the construction of a new reservoir was approximately NT$21 million.
Continue to pay attention to internal and external water conditions.
Implement water-saving measures such as “increasing the consumption of HBF re- cycled water” and “increasing the concentration ratio of the cooling water tower and reducing the amount of supplementary water”.
Continue to implement water use improvement plans to enhance the water recovery rate (R2).
In 2023, a filter tank and a pre-treatment device were added to the HBF system, which is expected to increase the water recycling volume by 35 million liters per year.
CGPC Building Material plant promotes rainwater recycling and reuse.
In 2021, a new 500-ton PE storage tank (20 pieces) was built.
In 2022, a new 1,500-ton tap water storage tank was built.
Carbon Fee Transition Risk/Policies and Laws In December 2023, the Ministry of Environment released the “Draft Regulations on Carbon Fees and Charges”. It is expected that a carbon fee will be levied by 2025 for large carbon emission companies with annual emissions exceeding 25,000 tonnes.
High initial investment costs, low carbon emissions in the long term, and reduced operating costs.

Assuming that the carbon fee is calculated based on the price of NT$300 per ton of CO2e and the ex- emption from the credit of 25,000 tonnes of CO2e:
The estimated carbon expenditure of CGPC and TVCM is NT$62.25 million in 2024, accounting for about 0.5% of the combined revenue in 2023.
Vinyl Chain implemented a number of carbon reduction projects in 2023, achieving a carbon reduction of 9,970 tonnes and a carbon reduc- tion benefit of NT$2.991 million.
CGPC uses internal carbon pricing as the shadow price to incorporate carbon costs into investment considerations to enhance the chances of implementing carbon reduction projects.
Actively implement carbon reduction projects, such as equipment replacement, process improvement, heat energy recovery, and other projects.
Introduce AI into the plant and the distillation column into the AI model to find the optimal operating conditions and reduce the steam consumption per product.
CGPC and TVCM have obtained credits from the greenhouse gas offset project, with a total of 7,464 tonnes of CO2e and a carbon reduction benefit of NT$2,239,200 (NT$300 per ton).
The plant will evaluate and propose voluntary reduction plans for preferential tariff rates and reduction of carbon fees from reduction credits after the relevant sub-laws are announced.
Renewable Energy Reg- ulations - Risk Clause for Large Power Users Transition Risk/Policies and Laws The Ministry of Economic Affairs “Regulations for the Management of Setting up Renewable Energy Power Generation Equipment of Power Users above a Certain Contract Capacity” came into effect in 2021, requiring large power consumers with a contracted capacity greater than 5,000 kW to install renewable energy equipment with 10% of the contracted capacity before 2025. Increasing capital expenditure

Installed a solar power installation with a capacity of 2.12MW on the roof. A total of NT$102.4 million has been invested, and the Company plans to meet the regulatory require- ments for setting renewable energy by large power users in 2024 ahead of schedule. 		A 2.12 MW solar power installation has been installed on the rooftop of the CGPC Main plant.
Low-carbon technology transition Transition Risk/Energy,Technology The development of low-carbon technologies such as energy transition, efficiency improve- ment, and fuel substitution for carbon reduc- tion leads to increased technology investment costs for enterprises. Increased capital expenditures and decreased cost of revenue

In 2023, Vinyl Chain invested about NT$195,084,000 in energy saving and carbon reduction projects, reducing 9,970 tonnes of CO2e.
In 2023, the amount of self-assessed purchases of government-approved green products was NT$71.45 million.
Vinyl Chain's 2023 water collector replacement and optimization of the hot water vapor heating system project was an investment of about NT$7.24 million.
All three factories of Vinyl Chain have passed the ISO 50001 Energy Management System certification.
Continue to implement energy-saving and carbon reduction equipment improve- ment plans, such as replacing old equipment with new ones, heat energy recov- ery, introducing AI energy-saving projects, and pyrolysis furnace energy-saving coating projects.
In 2019, we began to implement the green procurement plan. Through online project declaration, the green products that we mainly purchased were ener- gy-saving equipment.
Performance of investment in energy-saving equipment (pumps, motors, IE3 high-efficiency induction motors, inverters, gas boiler burners, LED bulbs, cooling tower circulation pumps, fans, or fans with inverters).
The project of replacing the old water collectors and the optimization of hot pure water vapor heating system projects of the three factories of Vinyl Chain can save about 14,213 tonnes of steam and 2,386 tonnes of CO2e annually.
Due to the increase in Taipower's electricity price in April 2024, it is estimat- ed that the electricity bill for the 3 core production factories will increase by NT$82.34 million per year. We will actively invest in low-carbon technology transitions to reduce the impact of electricity price increases.
Rising raw material prices Transition Risk/Market Under the consideration of future carbon taxa- tion, the cost of carbon emissions will be added to raw materials, and the price will increase. Increased cost of operating revenue

Due to factors such as inflation and uncertainties about the future economy, the global price of ethylene has declined. To strengthen the vertical in- tegration of the industrial chain and flexibly adjust production and sales plans, CGPC built an ethylene storage tank, and TVCM added a storage tank at the Intercontinental Wharf. This can provide a buffer during drastic market changes. The total construc- tion cost is about NT$3.5 billion.
Promote circular economy: Recycle and reuse raw materials. For example, the quantity of pipes recycled and reused by the building materials plant in 2023 was 2,621 tonnes, and the recycling and reuse rate accounted for 14.3% of the pipe production in 2023.
The Company adopts a vertically integrated strategy for the procurement of materials, production, and sales, and regularly reviews the inventory of raw ma- terials and finished products. Inventory changes are reviewed on a rolling basis in response to market changes. The projects are:
➤
TVCM has built storage tanks for ethylene, vinyl chloride, and ethylene dichlo- ride at the Intercontinental Wharfs.
➤
A new ethylene storage tank was built at the CGPC Main plant.
➤
Ensure flexible scheduling of production and sales of key raw materials.

Climate Change Topics Topic Category Description of Risks and Opportunities Potential Financial Impact Vinyl Chain Strategy and Countermeasures
Efficient production Opportunity/resource efficiency Improve overall production efficiency and reduce energy consumption with production tools such as AI smart production, industrial motors, and automatic packaging. Increased capital expenditures and reduced operating costs

Take the #5 dryer optimization project for example, about NT$4.15 million has been invested. The AI model provides the optimal program operating condition setting (SP) for intelligent control, saving about 1,100 tonnes of steam and annual expenses of NT$1.13 million, and annual carbon reduction up to 175 tonnes of CO2e. 		Introduce AI to create intelligent management (see Chapter 3.6)
Introduce AI into the process, find the best process operating condition settings through models, and perform intelligent control to optimize energy efficiency.
Combined with image identification (AOI), it is used for the thermal image iden- tification of power panels and sensing safety system of forklifts to improve the safety of the working environment.
For example, the implementation of35intelligent control on a 35-ton boilersaved 460,504 kWh of electricity, 1,400,000 M3 of natural gas, 3,138.5 tonnes of CO2e and NT$15.45 million in expenses.
Recycling and ReuseCircular Economy Opportunity/resource efficiency Based on the three principles of circular econo- my (3R):Reduce, reuse, and recycle. Reduce waste disposal Cost, or raw material consumption Increasing operating costs

In 2023, about NT$800,000 was invested in the GRS global recycling system certification project. In 2023, about NT$500,000 was invested in the TPE rubber project for the final product Recycle.
In 2023, about NT$800,000 was invested in the TPO fish-electricity symbiotic water pond fabric project.
Since 2021, the CGPC building materials plant has begun to collect all kinds of recycled materials and recovered PVC resin in the plant, and purchased recycled rubber pellets to be put into the production of new products for sale. In 2023, the recycling rate reached 14.3%.
The TPE eco-friendly leather products of CGPC use 30-60% of recycled plastics, and have obtained GRS global recycling system certification.
CGPC's PVC bags for small packages are replaced with hot-melt PE bags, which can be 100% recycled for reuse.
Reduce water usage and waste Opportunity/resource efficiency Water is an irreplaceable resource in the manu- facturing processes. To reduce plant water leakage and increase the proportion of water recycling and reuse, we can save operating costs and improve plant resilience. Increased capital expenditures and reduced operating costs

Centrifugal Drying High-performance Bio-treatment and Filtration system (HBF) project The input cost was about NT$92.83 million.
CGPC Building Materials plant has installed a rainwater recycling and reuse de- vice that can store about 5 tonnes of rainwater for watering flowers and for use in the toilets to save water consumption.
Centrifugal dryer process water recovery (HBF) was installed at CGPC Main plant and CGPCP Linyuan plant. The biological treatment system and COD adsorption system enhance the cooling water recovery rate, saving water up to 597.4 million liters per year in 2023.
In 2023, a filter tank and a pre-treatment device were added to the HBF system, which is expected to increase the water recycling volume by 35 million liters per year.
At the TVCM Linyuan plant, the process steam condensate is recycled and reused in the cooling water tower.
Use low-carbon energy Opportunity/resilience,energy source Promote coal-to-gas conversion, increase the proportion of renewable energy use, reduce carbon costs, lower product carbon footprints, and enhance corporate image and brand value. Increased capital expenditures and reduced car- bon fees

Energy saving improvement project for chlorine natural gas boilers of CGPC and TVCM, with an investment cost of about NT$63 million.
The installation of a 30-ton natural gas boiler at the CGPC Main plant was com- pleted in October 2023, which can save natural gas by 1,235,889 NM3/year and reduce carbon by 2,345 tonnes CO2e/year.
Since 2021, we have promoted the conversion of coal-fired boilers to natural gas boilers. It is planned to switch to natural gas before 2025, and the estimated carbon reduction is about 16,000 tonnes CO2e.
TVCM Linyuan plant - The optimization and improvement project for the 35-ton steam boiler was completed in July 2023. After optimization, the boiler can save 1,400,000 NM3 of natural gas/year. Switching to inverter control for windmills can save 460,504 kWh of electricity and 3,139 tonnes of CO2e/year in total.
R&D and innovation in developing new products and services - Research and devel- opment of low-carbon energy-saving products Opportunities/Products and Services Develop circular economy, low-carbon, and energy-saving products. Invest in technology from the perspective of the complete life cycle of products and services to develop low-carbon products. Increase in research and development expenses,increase in operating costs

In 2023, we have obtained the GRS Global Recycling System certification project which will enhance the Company's corporate image, obtain brand certification, and increase market compet- itiveness. An investment of about NT$800,000 was made.
NT$500,000 was invested in the bio-shell powder antibacterial and anti-mold rubber project in 2023.
Continue to develop circular recycled products:
We adopt post-consumer TPO or industrial waste TPU materials and utilize a compression molding process along with post-consumer recycled PET bottles to produce polyester non-woven fabric (base fabric) for environmentally friendly synthetic leather. The percentage of recycled plastics reaches 30-60%, and with GRS global recycling system certification.
Oyster shell powder is made from waste oyster shells and calcined at high temperature. It is a natural material and has been used in artificial leather to replace synthetic antibacterial agents. It can minimize environmental impact and pollution. It has been tested and certified to have antibacterial and anti-mold properties effect.
Better Use of Public Sector Incentives Opportunity/Market Use the government incentive mechanism to reduce input costs, adopt new technologies, and enhance competitiveness. Higher capital expenditures and higher revenues

CGPC Main plant was selected by the Taiwan Green Productivity Foundation to become a TCFD demonstration manufacturer.
The CGPC Main plant was selected by the Taiwan Industrial Development Foundation as the guidance vendor. The Company applied for a green factory label (cleaner production + green building certification) with an investment of NT$1.5 million.
Application items for low interest rates:
➤
CGPC's application plan: Deeply-rooted Tai- wanese enterprises - automatic warehousing - Taiwanese business participants returning to invest in Taiwan - VCM storage tanks.
➤
TVCM: The SME - Intercontinental Phase II project received government support for a low-interest project of about NT$18.56 million in 2023.
In 2023, government subsidies totaled NT$1.394 million.
During the 2023 TCFD event, CGPC arranged five consultation sessions to esti- mate the future scenarios of three climate disasters - “flooding, drought, and high temperature” between 2016 and 2035 based on the RCP 8.5 scenario. For transition risk, the IEA is referred to. The scenario is set as “the future global tem- perature will rise by 1.5°C” to facilitate medium and long-term strategy planning, allowing the Company to better grasp risks and opportunities, and share TCFD implementation experience with various industries in 2024.
In 2023, CGPC applied for a green factory label and we have arranged five consul- tation sessions. The document was submitted for review in December, and we expect to arrange a cleaner production assessment for on-site inspection and evaluation in April 2024. On green building, improvements are made to the air conditioning system.
Obtain government subsidies and low-interest loans to effectively reduce costs and prepare sufficient funds for operating needs.
Government subsidies in 2023 (unit: NTD Ten thousand)
➤
Domestic investment interest subsidy of NT$102
➤
Occupational Safety and Health Administration, Ministry of Labor NT$20.6
➤
Water Resources Agency, Ministry of Economic Affairs NT$10
➤
Bureau of Labor Insurance, Ministry of Labor NT$4.9
➤
Taoyuan-Hsinchu-Miaoli Branch of the Workforce Development Agency, Minis- try of Labor NT$1.8
➤
Environmental Protection Administration, Executive Yuan NT$0.1
Circular economy
CGPC values the efficiency of resources use and have adopted the circular model of recovery and re-use of raw materials and supplies, manufacturing process and distribution. In 2023 ,the internal and external results of circular economy practices are shown as follows:
Energy management
The main energy sources used by CGPC's plants are purchased electricity, natural gas, and fuel coal. The scope of the 2023 energy use inventory includes CGPC Toufen Main Plant, TVCM and CGPCP Yuan Plant. The coverage rate is 100% and obtained ISO 50001 as well.
Energy consumption for per unity unit products during the last three years (Unit: GJ/tones)
  • 2021
  • 2022
  • 2023
PVC resin
CGPC
Chemical products
Fabrication products
VCM
TVCM
PVC resin
CGPCP
Greenhouse gas management
GHG inventory is carried out every year to effectively manage the emissions of each factory of CGPC. Among them, CGPC Toufen Main Plant and TVCM's Linyuan plant are the first wave of regulations for stationary sources that should be checked and registered for greenhouse gas emissions under the Greenhouse Gas Reduction and Management Act, so the inventory of GHG is carried out in accordance with the Management Measures for GHG Inventory Registration, and the data is regularly verified by an independent third-party verification agency.
Greenhouse gas emission intensity during the last three years (Unit: tones CO2e/tones)
  • 2021
  • 2022
  • 2023
PVC resin
CGPC
Chemical products
Fabrication products
VCM
TVCM
PVC resin
CGPCP
Greenhouse gas emissions during the last three years (Unit: -0,000 tones CO2e)
  • Scope 1
  • Scope 2
  • Scope 3
  • 2021
  • 2022
  • 2023
CGPC
  • 2021
  • 2022
  • 2023
TVCM
  • 2021
  • 2022
  • 2023
CGPCP
Notes:
1.
Scope of inventory in 2023: (1) CGPC includes: CGPC Main plant, Taipei Office, and overseas subsidiaries. (2) TVCM Company includes: TVCM's Linyuan plant, Taipei office, and GGTC Company. (3) It was Linyuan plant for CGPCP Company. The above scope includes CGPC's subsidiaries in the consolidated financial statements, and the coverage rate is 100%. GHG inventory includes: CO2, CH4, N2O, and HFCs.
2.
Scope 3 coverage was added to TVCM and CGPCP starting from 2021, and Scope 3 coverage was added to CGPC from 2022.
3.
The calculation adopts the operational control method, and the emission coefficient adopts the coefficient announced by the Ministry of Environment. (The carbon emission coefficient of electricity provided by the Energy Administration)
4.
TVCM and CGPCP revised its greenhouse gas emissions in 2022 because the inventory data was obtained after the reporting.
5.
For other information, see: Remarks on Carbon Reduction Pathway Planning.
6.
Subsidiaries in the consolidated financial statements of CGPC - Categories covered in Scope 3:
➤
GHG emissions from upstream and downstream transportation and cargo distribution, GHG emissions from employee commuting, and GHG emissions from business travel, and GHG emissions from the organization's procurement of raw materials, extraction, manufacturing, and processing, and GHG emissions from the disposal of solid and liquid wastes.
Entrust a third party to conduct a greenhouse gas inventory.
Greenhouse gas and ISO 14067 product carbon footprint verification is conducted in accordance with the ISO 14064-1:2018 standard. The certificate can be found on the official website.

1.
2.
3.
Starting from 2023, the scope of inspections will be: GHG emissions from the organization's procurement of raw materials, extraction,manufacturing, and processing, and GHG emissions from the disposal of solid and liquid wastes.
Renewable Energy
Project / completion date
Phase 1 set up of 499.59 kWp.
Phase 2 set up of 438.59 kWp.
Completion of construction and start to sell electricity on Apr 16, 2019.
Phase 3 set up of 236.84 kWp.
Phase 4 set up of 74.4 kWp.
Phase 5 set up of 188.48 kWp.
Phase 3, 4 and 5 completed on Dec 25, 2019.
Completion of construction and start to sell electricity.
Total installed capacity is 1,437.9 kWp.
Effectiveness of the improvements
In 2019, the rooftop of CGPC Main plant rented out 1,438 kWp of solar power equipment in the plant. CGPC purchased the solar photovoltaic equipment back in May 2022.
In 2023, the 1.73 million kWh of solar power generated was sold entirely to Taipower.
Promotion of renewable energy
CGPC starts it from the construction of solar photovoltaic equipment on the plant roof, and gradually expanded the use of green electricity in each plant area.
CGPC will continue to expand the capacity of solar energy equipment and completed the installation of 679.82kWp solar energy in the plant before the end of 2023.
TVCM Linyuan plant does not have a suitable roof space to put solar energy equipment. It plans to purchase 1.64 million kWh of green electricity and certificates by the end of 2025.
Please click the picture to see the real-time monitoring situation.
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