Measures Against Climate Change

Approach and Policy

We recognize climate change as a significant risk as well as an opportunity for innovation and the creation of new businesses. Additionally, since our products emit greenhouse gases (GHG) due to the use of fossil fuels in their manufacturing process, we acknowledge climate change as one of the critical issues for business continuity.

Resonac is committed to reducing greenhouse gas emissions throughout its entire value chain to achieve a carbon-neutral society by thoroughly rationalizing, increasing efficiency, saving energy, and shifting fuels; manufacturing products utilizing renewable energy such as hydroelectric and solar power; developing and producing low-power consumption and environmentally friendly products; and developing innovative CO₂ separation and recovery technologies to use the captured CO₂ as raw materials for chemicals.

Goals and Progress Status

GHG Emission Reduction Roadmap

Towards achieving 'Carbon Neutrality by 2050,' we will promote thorough rationalization, high efficiency, energy conservation, conversion to gas fuel (high-efficiency cogeneration systems), and product manufacturing utilizing renewable energy until 2030. From 2030 onwards, in preparation for 2050, we will also actively promote fuel conversion and co-firing with ammonia and hydrogen. In order to achieve the targets, each Business Unit will advance goal setting, develop and implement reduction measures, while company-wide cross-functional measures will also be executed under the leadership of the Carbon Neutral Project, progressing the establishment of scientifically based reduction targets. Additionally, with the aim of covering 100% of the electricity used in its own business with renewable energy, a new roadmap for the electrification of power consumption with renewable energy has also been created. Additionally, by realizing CCUS*, such as CO₂ separation and recovery technologies and the use of recovered CO₂ as chemical raw materials, we will achieve carbon neutrality.

• *CCUS：Carbon dioxide Capture, Utilization and Storage：Carbon dioxide Capture, Utilization and Storage

• ※ We consider starting the calculation and disclosure of Scope 3 emissions from upstream activities before setting a reduction target.

Specific initiatives

Efforts toward obtaining Science Based Targets (SBT) certification

We have declared that it will obtain SBT certification in June 2025. We will work on establishing mid- to long-term greenhouse gas emission reduction targets based on scientific evidence, aiming to limit the global average temperature rise to below 2°C (partly within 1.5°C) as agreed in the Paris Agreement.

Utilization of renewable energy

The switch to renewable energy for electricity usage was first implemented at the Packaging Solution Center (Shinkawasaki) in 2020. Following this, the switch has also been completed at the Advanced Fusion Research Institute (Tsukuba), the Stage for Co-creation (Yokohama), and the Shiodome Headquarters, which relocated in 2023. Furthermore, Resonac Graphite Austria GmbH (Austria), which produces graphite electrodes, switched to wind power-derived electricity in 2023.
Also, in 2024, the Resonac Group as a whole purchased 196.7 thousand MWh of electricity derived from renewable energy. Consideration of CO₂

Capture from Oita Complex^*1emissions and offshore storage in Malaysia

We have signed a memorandum with Mitsui & Co., Ltd. (hereinafter referred to as Mitsui & Co.) to conduct joint studies on CCS^*2, which involves capturing CO₂ emitted from our Oita Complex and storing it underground offshore Malaysia. Mitsui & Co. is jointly advancing a CCS project offshore Malaysia with Malaysia's national oil company and others; the signing of this memorandum assumes and considers that project as a storage site. Through the project, we aim to build a value chain that includes the recovery of CO₂ within our company, storage at CO₂ storage sites^*3(CCS), and transportation. Our company is responsible for the separation, recovery, liquefaction, storage of CO₂ emitted from the Oita Complex, and handover to transportation operators, while Mitsui & Co. will handle the maritime transport of liquefied CO₂ to Malaysia and the underground storage off the coast of Malaysia. Each party will proceed with verifying the necessary technical requirements and estimating costs.

• * 1. As of August 1, 2024, our company's petrochemical Business Unit was spun off as Kurasas Chemical Co., Ltd.
• * 2. Carbon dioxide Capture and Storage：Carbon dioxide Capture and Storage: recovery and storage of carbon dioxide（CO₂）
• * 3. Malaysia's state-owned oil company Petroliam Nasional Berhad's CCS business company PETRONAS CCS Solutions Sdn Bhd and the French comprehensive
  The CO₂ storage site off the coast of Malaysia, jointly developed since June 2023 with TotalEnergies Carbon Neutrality Ventures, the CCS business company of the energy company TotalEnergies, plans to start storage operations around 2030.

Scope3: Decarbonization of company vehicles (gasoline cars)

In addition to reducing its own emissions (Scope 1 and 2), the company is also working on reducing GHG emissions throughout the supply chain, including Scope 3. In 2023, it was decided to switch all company vehicles (gasoline-powered models) to eco-friendly cars. Over the next two years, it is expected that over 60% of the vehicles in Japan will be replaced. Going forward, we will also consider transitioning to FCVs (fuel cell vehicles), accelerating the reduction of GHG emissions associated with company vehicle use, and by 2030, we plan to adopt EVs and FCVs including at overseas Business Units. In addition, we will promote the electrification of forklifts used within business sites and work on reducing GHG emissions derived from fossil fuels.

High-efficiency cogeneration system

In chemical plants, to utilize energy suitable for applications such as heating and distillation in the manufacturing process, our company owns thermal power generation facilities that combine boilers and steam turbines, enabling efficient extraction of electricity and heat (steam) energy from fossil resources. Additionally, the thermal power generation facilities are essential as a power outage prevention function in chemical plants.

Therefore, for the thermal power self-generation systems owned by our company, as the first step, we will aim to improve overall energy efficiency by introducing advanced high-efficiency gas turbines and cogeneration systems, while also challenging low-carbon initiatives through the switch to fuels with lower CO₂ emissions per unit heat generation. This makes it possible to achieve a significant reduction in CO₂ emissions by switching from solid fuel to gas fuel.
Also, as the second step, we aim to reduce environmental impact by combining co-firing with carbon-free fuels such as ammonia and carbon recycling through CCU^*

• * Carbon Capture and Utilization：Technology that captures and uses carbon dioxide.

Intellectual property of chemical recycling technology

KPR (Kawasaki Plastic Recycle), one of the chemical recycling technologies, is also actively engaged in intellectual property activities. For example, we are investing in intellectual property that supports sustainable development by building a comprehensive patent network, such as "Operating methods of a gasifier to reduce the viscosity of slag (International Application No. PCT/JP2020/047249)".

Holding exchange meetings for young professionals aimed at carbon neutrality.

At our Oita Complex, Kawasaki Plant, and the Stage for Co-creation (Yokohama), we are conducting research and development of technologies that contribute to carbon neutrality (hereinafter, CN). Amid this, with the aim of deepening understanding of carbon neutrality (CN)-related study sessions and the development and technologies possessed at each site, we have been regularly holding CN young professionals' exchange meetings focused on young engineers in their 20s and 30s since 2023. In June 2024, we conducted factory tours and poster discussion sessions at the Oita Complex, engaging in active exchanges of opinions regarding technologies such as those utilizing CO₂ and waste plastics. We will continue to foster co-creation both inside and outside the company through the CN Young Professionals Exchange Meeting, aiming to develop innovative technologies that contribute to CN.